§1-860. Subpart definitions
In this Subpart, the following meanings shall apply:
(1)"Control", including the term "controlled by", means either of the following:
(a)Having the power, directly or indirectly, to elect or remove a majority of the
members of the board of directors or other governing body of an entity, whether through the
ownership of voting shares or interests, by contract, or otherwise.
(b)Being subject to a majority of the risk of loss from the entity's activities or
entitled to receive a majority of the entity's residual returns.
(2)"Director's conflicting interest transaction" means any of the following:
(a)A transaction effected or proposed to be effected by the corporation, or by an
entity controlled by the corporation, to which, at the relevant time, the director i
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§1-860. Subpart definitions
In this Subpart, the following meanings shall apply:
(1) "Control", including the term "controlled by", means either of the following:
(a) Having the power, directly or indirectly, to elect or remove a majority of the
members of the board of directors or other governing body of an entity, whether through the
ownership of voting shares or interests, by contract, or otherwise.
(b) Being subject to a majority of the risk of loss from the entity's activities or
entitled to receive a majority of the entity's residual returns.
(2) "Director's conflicting interest transaction" means any of the following:
(a) A transaction effected or proposed to be effected by the corporation, or by an
entity controlled by the corporation, to which, at the relevant time, the director is a party.
(b) A transaction effected or proposed to be effected by the corporation, or by an
entity controlled by the corporation, respecting which, at the relevant time, the director had
knowledge and a material financial interest known to the director.
(c) A transaction effected or proposed to be effected by the corporation, or by an
entity controlled by the corporation, respecting which, at the relevant time, the director knew
that a related person was a party or had a material financial interest.
(3) "Fair to the corporation" means, for purposes of R.S. 12:1-861(B)(3), that the
transaction as a whole was beneficial to the corporation, taking into appropriate account
whether it was fair in terms of the director's dealings with the corporation, and comparable
to what might have been obtainable in an arm's length transaction, given the consideration
paid or received by the corporation.
(4) "Material financial interest" means a financial interest in a transaction that would
reasonably be expected to impair the objectivity of the director's judgment when participating
in action on the authorization of the transaction.
(5) "Related person" means, at the relevant time, any of the following:
(a) The individual's spouse.
(b) A child, stepchild, grandchild, parent, stepparent, grandparent, sibling,
stepsibling, half sibling, aunt, uncle, niece or nephew, or spouse of any thereof, of the
individual or of the individual's spouse.
(c) A natural person living in the same home as the individual.
(d) An entity, other than the corporation or an entity controlled by the corporation,
controlled by the individual or any person specified above in this Paragraph.
(e) A domestic or foreign business or nonprofit corporation, other than the
corporation or an entity controlled by the corporation, of which the individual is a director,
a domestic or foreign unincorporated entity of which the individual is a general partner or
a member of the governing body, or a domestic or foreign individual, trust, or estate for
whom or of which the individual is a trustee, guardian, personal representative, or like
fiduciary.
(f) A person that is, or an entity that is controlled by, an employer of the individual.
(g) A person with whom the individual has a material relationship.
(6) "Relevant time" means the time at which directors' action respecting the
transaction is taken in compliance with R.S. 12:1-862, or if the transaction is not brought
before the board of directors of the corporation or its committee for action under R.S.
12:1-862, at the time the corporation, or an entity controlled by the corporation, becomes
legally obligated to consummate the transaction.
(7) "Required disclosure" means disclosure of the existence and nature of the
director's conflicting interest, and all facts known to the director respecting the subject matter
of the transaction that a director free of such conflicting interest would reasonably believe
to be material in deciding whether to proceed with the transaction.