Title 29, Business Organizations. [Enacted title]

(a) Two or more shareholders may provide for the manner in which they will vote their shares by signing an agreement for that purpose. A voting agreement created under this section shall not be subject to § 29-305.40. (b) A voting agreement created under this section shall be spe…

(a) An agreement among the shareholders of a corporation that complies with this section shall be effective among the shareholders and the corporation even though it is inconsistent with one or more other provisions of this chapter in that it: (1) Eliminates the board of director…

For the purposes of this part, the term: (1) “Derivative proceeding” means a civil action in the right of a domestic corporation or, to the extent provided in § 29-305.57, in the right of a foreign corporation. (2) “Shareholder” includes a beneficial owner whose shares are held i…

A shareholder shall not commence or maintain a derivative proceeding unless the shareholder: (1) Was a shareholder of the corporation at the time of the act or omission complained of or became a shareholder through transfer by operation of law from one that was a shareholder at t…

A shareholder shall not commence a derivative proceeding until: (1) A written demand has been made upon the corporation to take suitable action; and (2) Ninety days have expired from the date the delivery of the demand was made unless (A) The shareholder has earlier been notified…

If the corporation commences an inquiry into the allegations made in the demand or complaint, the Superior Court may stay any derivative proceeding for such period as the court consider appropriate.

(a) The Superior Court shall dismiss a derivative proceeding on motion by the corporation if one of the groups specified in subsection (b) or subsection (e) of this section has determined in good faith, after conducting a reasonable inquiry upon which its conclusions are based, t…

A derivative proceeding shall not be discontinued or settled without the Superior Court’s approval. If the court determines that a proposed discontinuance or settlement will substantially affect the interests of the corporation’s shareholders or a class of shareholders, the court…

On termination of the derivative proceeding, the Superior Court may order: (1) The corporation to pay the plaintiff’s expenses incurred in the proceeding if it finds that the proceeding has resulted in a substantial benefit to the corporation; (2) The plaintiff to pay any defenda…

In any derivative proceeding in the right of a foreign corporation, the matters covered by this part shall be governed by the laws of the jurisdiction of incorporation of the foreign corporation, except for §§ 29-305.53, 29-305.55, and 29-305.56.

(a) The Superior Court may appoint one or more persons to be custodians or, if the corporation is insolvent, to be receivers, of and for a corporation in a proceeding by a shareholder if it is established that: (1) The directors are deadlocked in the management of the corporate a…

(a) Except as otherwise provided in § 29-305.42, each corporation shall have a board of directors. (b) All corporate powers shall be exercised by or under the authority of the board of directors of the corporation and the activities and affairs of the corporation shall be managed…

The articles of incorporation or bylaws may prescribe qualifications for directors. A director need not be a resident of the District or a shareholder of the corporation unless the articles of incorporation or bylaws so prescribe.

(a) A board of directors shall consist of one or more individuals, with the number specified in or fixed in accordance with the articles of incorporation or bylaws. (b) The number of directors may be increased or decreased by amendment to, or in the manner provided in, the articl…

If the articles of incorporation authorize dividing the shares into classes, the articles may also authorize the election of all or a specified number of directors by the holders of one or more authorized classes of shares. A class or classes of shares entitled to elect one or mo…

(a) The terms of the initial directors of a corporation expire at the 1st shareholders’ meeting at which directors are elected. (b) The terms of all other directors shall expire at the next, or if their terms are staggered in accordance with § 29-306.06, at the applicable 2nd or …

The articles of incorporation may provide for staggering the terms of directors by dividing the total number of directors into 2 or 3 groups, with each group containing 1 /2 or 1 /3 of the total, as near as may be practicable. In that event, the terms of directors in the 1st grou…

(a) A director may resign at any time by delivering a written resignation to the board of directors, or its chair, or to the secretary of the corporation. (b) A resignation shall be effective when the resignation is delivered unless the resignation specifies a later effective dat…

(a) The shareholders may remove one or more directors with or without cause unless the articles of incorporation provide that directors shall be removed only for cause. (b) If a director is elected by a voting group of shareholders, only the shareholders of that voting group shal…

(a) The Superior Court may remove a director of the corporation from office in a proceeding commenced by or in the right of the corporation if the court finds that: (1) The director engaged in fraudulent conduct with respect to the corporation or its shareholders, grossly abused …

(a) Unless the articles of incorporation provide otherwise, if a vacancy occurs on a board of directors, including a vacancy resulting from an increase in the number of directors: (1) The shareholders may fill the vacancy; (2) The board of directors may fill the vacancy; or (3) I…

Unless the articles of incorporation or bylaws provide otherwise, the board of directors may fix the compensation of directors.

(a) The board of directors may hold regular or special meetings in or outside of the District. (b) Unless the articles of incorporation or bylaws provide otherwise, the board of directors may permit any or all directors to participate in a regular or special meeting by, or conduc…

(a) Except to the extent that the articles of incorporation or bylaws require that action by the board of directors be taken at a meeting, action required or permitted by this chapter to be taken by the board of directors may be taken without a meeting if each director signs a co…

(a) Unless the articles of incorporation or bylaws provide otherwise, regular meetings of the board of directors may be held without notice of the date, time, place, or purpose of the meeting. (b) Unless the articles of incorporation or bylaws provide for a longer or shorter peri…

(a) A director may waive any notice required by this chapter, the articles of incorporation, or bylaws before or after the date and time stated in the notice. Except as otherwise provided in subsection (b) of this section, the waiver shall be in writing, signed by the director en…

(a) Unless the articles of incorporation or bylaws require a greater number or unless otherwise specifically provided in this chapter, a quorum of a board of directors shall consist of a majority of the: (1) Fixed number of directors if the corporation has a fixed board size; or …

(a) Unless this chapter, the articles of incorporation, or the bylaws provide otherwise, a board of directors may create one or more committees and appoint one or more members of the board of directors to serve on any such committee. (b) Unless this chapter otherwise provides, th…

(a) Each member of the board of directors, when discharging the duties of a director, shall act: (1) In good faith; and (2) In a manner the director reasonably believes to be in the best interests of the corporation. (b) The members of the board of directors or a committee of the…

(a) A director shall not be liable to the corporation or its shareholders for any decision to take or not to take action, or any failure to take any action, as a director, unless the party asserting liability in a proceeding establishes that: (1) None of the following, if interpo…

(a) A director who votes for or assents to a distribution in excess of what may be authorized and made pursuant to § 29-304.60(a) or § 29-312.09(a) shall be personally liable to the corporation for the amount of the distribution that exceeds what could have been distributed witho…

(a) A corporation shall have the officers described in its bylaws or appointed by the board of directors in accordance with the bylaws. (b) The board of directors may elect individuals to fill one or more offices of the corporation. An officer may appoint one or more officers if …

Each officer has the authority to, and shall, perform: (1) The functions set forth in the bylaws; or (2) To the extent consistent with the bylaws, the functions prescribed by the board of directors or by direction of an officer authorized by the board of directors to prescribe th…

(a) An officer, when performing in such capacity, shall have the duty to act: (1) In good faith; (2) With the care that a person in a like position would reasonably exercise under similar circumstances; and (3) In a manner the officer reasonably believes to be in the best interes…

(a) An officer may resign at any time by delivering notice to the corporation. A resignation shall be effective when the notice is delivered, unless the notice specifies a later effective time. If a resignation is made effective at a later time and the board or the appointing off…

(a) The appointment of an officer shall not itself create contract rights. (b) An officer’s removal shall not affect the officer’s contract rights, if any, with the corporation. An officer’s resignation shall not affect the corporation’s contract rights, if any, with the officer.

For the purposes of this part, the term: (1) “Corporation” includes any domestic or foreign predecessor entity of a corporation in a merger. (2) “Director” or “officer” means an individual who is or was a director or officer, respectively, of a corporation or who, while a directo…

(a) Except as otherwise provided in this section, a corporation may indemnify an individual who is a party to a proceeding because the individual is a director against liability incurred in the proceeding if the director: (1)(A) Conducted himself or herself in good faith; (B) Rea…

A corporation shall indemnify a director who was wholly successful, on the merits or otherwise, in the defense of any proceeding to which the director was a party because he or she was a director of the corporation against expenses incurred by the director in connection with the …

(a) A corporation may, before final disposition of a proceeding, advance funds to pay for or reimburse expenses incurred in connection with the proceeding by an individual who is a party to the proceeding because that individual is a member of the board of directors if the direct…

(a) A director who is a party to a proceeding because he or she is a director may apply for indemnification or an advance for expenses to the Superior Court. After receipt of an application and after giving any notice it considers necessary, the court shall: (1) Order indemnifica…

(a) A corporation shall not indemnify a director under § 29-306.51 unless authorized for a specific proceeding after a determination has been made that indemnification is permissible because the director has met the relevant standard of conduct set forth in § 29-306.51. (b) The d…

(a) A corporation may indemnify and advance expenses under this part to an officer of the corporation who is a party to a proceeding because he or she is an officer of the corporation: (1) To the same extent as a director; and (2) If he or she is an officer but not a director, to…

A corporation may purchase insurance on behalf of an individual who is a director or officer of the corporation, or who, while a director or officer of the corporation, serves at the corporation’s request as a director, officer, partner, trustee, employee, or agent of another dom…

(a) A corporation may, by a provision in its articles of incorporation or bylaws or in a resolution adopted or a contract approved by its board of directors or shareholders, obligate itself in advance of the act or omission giving rise to a proceeding to provide indemnification i…

A corporation may provide indemnification or advance expenses to a director or an officer only as permitted by this part.