21-2432. Legislative declarations.

It is declared that:

(1) This state has traditionally regulated the affairs of corporations, including the regulation of mergers and other business combinations. The United States Supreme Court has recently reaffirmed the power of states to regulate these affairs;

(2) Issuing public corporations encompass, represent, and affect, through their ongoing business operations, a variety of constituencies including shareholders, employees, customers, suppliers, and local communities and their economies whose welfare is vital to this state's interests;

(3) In order to promote the welfare of these constituencies, the regulation of the internal affairs of issuing public corporations by the laws of this state governing business corporations should allow for the stable, long-term growth of issuing public corporations;

(4) Business combinations involving public corporations frequently occur through acquisition techniques which in effect coerce shareholders to participate in the transaction;

(5) Business combinations involving public corporations are also frequently financed largely through debt to be repaid in the short term through changes in operations of the public corporation, the sale of assets of the public corporation, and other means. These measures involve a substantial risk of unfair business dealing, may prevent shareholders from realizing the full value of their holdings through forced mergers and other coercive devices, and may undermine the state's interest in promoting stable relationships involving the corporations that it charters; and

(6) The Shareholders Protection Act is not intended to alter the case law development on directors' fiduciary duties of care and loyalty in responding to challenges to control or the burden of proof with regard to compliance with those duties, nor is the act intended to prevent the use of any other lawful defensive measure.

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