Utah Code 48-4-302. Standard of conduct for managers and officers

48-4-302. Standard of conduct for managers and officers.

(1)	Each manager of a manager-managed benefit company shall consider the interests and factors described in Subsections 48-4-301(1) and (2) when discharging the manager’s duties under this chapter and the operating agreement.

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Terms Used In Utah Code 48-4-302

Beneficiary: A person who is entitled to receive the benefits or proceeds of a will, trust, insurance policy, retirement plan, annuity, or other contract. ^{Source: OCC}
Benefit company: means a limited liability company:

(a)	that elects to become subject to this chapter; and

(b)

the status of which as a benefit company has not been terminated. See Utah Code 48-4-103

General public benefit: means a material positive impact on society and the environment:

(a)	taken as a whole;

(b)	assessed against a third-party standard; and

(c)

from the business of a benefit company. See Utah Code 48-4-103

Person: means :Utah Code 68-3-12.5

Specific public benefit: includes :

(a)	providing low-income or underserved individuals or communities with beneficial products or services;

(b)	promoting economic opportunity for individuals or communities beyond the creation of jobs in the normal course of business;

(c)	protecting or restoring the environment;

(d)	improving human health;

(e)	promoting the arts, sciences, or advancement of knowledge;

(f)	increasing the flow of capital to entities with a purpose to benefit society or the environment; and

(g)

conferring any other particular benefit on society or the environment. See Utah Code 48-4-103

(2)

If a benefit company has a person serving as an officer, the person shall consider the interests and factors described in Subsections 48-4-301(1) and (2) when discharging the person’s duties under this chapter and the operating agreement if:

(a)	the officer has discretion to act with respect to the matter; and

(b)	it reasonably appears to the officer that the matter may have a material effect on the benefit company’s creation of a general public benefit or a specific public benefit identified in the benefit company’s certificate of organization.

(3)	A manager’s consideration of the interests and factors described in Subsections 48-4-301(1) and (2) does not constitute a violation of Section 48-3a-409.

(4)	A manager or officer does not have a duty to a person who is a beneficiary of the benefit company’s general public benefit purpose or a specific public benefit purpose arising from the person’s status as a beneficiary.

Enacted by Chapter 201, 2018 General Session

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