Title 23, Corporations And Partnerships

D. Distributions [§414-111] Distributions to shareholders. (a) A board of directors may authorize and the corporation may make distributions to its shareholders subject to restriction by the articles of incorporation and the limitation in subsection (c). (b) If the board of direc…

§414-12 Forms. (a) The department director may prescribe and furnish on request forms for: (1) An application for a certificate of good standing; (2) A foreign corporation's application for a certificate of authority to transact business in this State; (3) A foreign corporation's…

PART VIII. SHAREHOLDERS A. Meetings §414-121 Annual meeting. (a) A corporation shall hold a meeting of shareholders annually at a time stated in or fixed in accordance with the bylaws. (b) Annual shareholders' meetings may be held in or out of this State at the place stated in or…

§414-122 Special meeting. (a) A corporation shall hold a special meeting of shareholders: (1) On call of its board of directors or the person or persons authorized to do so by the articles of incorporation or bylaws; or (2) If the holders of at least ten per cent of all the votes…

§414-123 Court-ordered meeting. (a) The circuit court may summarily order a meeting to be held: (1) On application of any shareholder of the corporation entitled to participate in an annual meeting if an annual meeting was not held within the earlier of six months after the end o…

§414-124 Action without meeting. (a) Action required or permitted by this chapter to be taken at a shareholders' meeting may be taken without a meeting if the action is taken by all the shareholders entitled to vote on the action. The action shall be evidenced by one or more writ…

§414-125 Notice of meeting. (a) A corporation shall notify shareholders of the date, time, and place, if any, of each annual and special shareholders' meeting no fewer than ten nor more than sixty days before the meeting date. If means of remote communication are authorized for u…

§414-126 Waiver of notice. (a) A shareholder 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. The waiver shall be in writing and be signed by the shareholder entitled to the notice or s…

[§414-127] Record date. (a) The bylaws may fix or provide the manner of fixing the record date for one or more voting groups to determine the shareholders entitled to notice of a shareholders' meeting, to demand a special meeting, to vote, or to take any other action. If the byla…

§414-13 Filing, service, and copying fees. (a) The following fees shall be paid to the department director upon the filing of corporate documents: (1) Articles of incorporation, $100; (2) Articles of amendment, $25; (3) Restated articles of incorporation, $25; (4) Articles of con…

§414-14 Effective time and date of document. (a) Except as provided in subsection (b) and section 414-15(c), a document accepted for filing is effective at the time of filing on the date it is filed, as evidenced by the department director's date and time endorsement on the origi…

B. Voting §414-141 Shareholders' list for meeting. (a) After fixing a record date for a meeting, a corporation shall prepare an alphabetical list of the names of all its shareholders who are entitled to notice of a shareholders' meeting. The list shall be arranged by voting group…

[§414-142] Voting entitlement of shares. (a) Except as provided in subsections (b) and (d) or unless the articles of incorporation provide otherwise, each outstanding share, regardless of class, is entitled to one vote on each matter voted on at a shareholders' meeting. Only shar…

§414-143 Proxies. (a) A shareholder may vote the shareholder's shares in person or by proxy. (b) A shareholder may appoint a proxy to vote or otherwise act for the shareholder by signing an appointment form. The appointment form shall be signed by either the shareholder personall…

[§414-144] Shares held by nominees. (a) A corporation may establish a procedure by which the beneficial owner of shares that are registered in the name of a nominee is recognized by the corporation as the shareholder. The extent of this recognition may be determined in the proced…

§414-145 Corporation's acceptance of votes, etc. (a) If the name signed on a vote, consent, waiver, or proxy appointment corresponds to the name of a shareholder, the corporation, acting in good faith, is entitled to accept the vote, consent, waiver, or proxy appointment and to g…

[§414-146] Quorum and voting requirements for voting groups. (a) Shares entitled to vote as a separate voting group may take action on a matter at a meeting only if a quorum of those shares exists with respect to that matter. Unless the articles of incorporation or this chapter p…

[§414-147] Action by single and multiple voting groups. (a) If the articles of incorporation or this chapter provide for voting by a single voting group on a matter, action on that matter is taken when voted upon by that voting group as provided in section 414-146. (b) If the art…

[§414-148] Greater quorum or voting requirements. (a) The articles of incorporation may provide for a greater quorum or voting requirement for shareholders (or voting groups of shareholders) than is provided for by this chapter. (b) An amendment to the articles of incorporation t…

[§414-149] Voting for directors; cumulative voting. (a) Unless otherwise provided in the articles of incorporation, directors shall be elected by a plurality of the votes cast by the shares entitled to vote in the election at a meeting at which a quorum is present. (b) If, not le…

[§414-15] Correcting filed document. (a) A domestic or foreign corporation may correct a document filed by the department director if the document: (1) Contains an incorrect statement; or (2) Was defectively executed, attested, sealed, verified, or acknowledged. (b) A document is…

§414-16 Filing duty of department director. (a) If a document delivered to the department director for filing satisfies the requirements of section 414-11, the department director shall file it. (b) The department director files a document by stamping or otherwise endorsing the d…

C. Voting Trusts and Agreements [§414-161] Voting trusts. (a) One or more shareholders may create a voting trust, conferring on a trustee the right to vote or otherwise act for them, by signing an agreement setting out the provisions of the trust (which may include anything consi…

[§414-162] Voting agreements. (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 is not subject to section 414-161. (b) A voting agreement created und…

§414-163 Shareholder agreements. (a) An agreement among the shareholders of a corporation that complies with this section is 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) Elimi…

[§414-17] Appeal from department director's refusal to file document. (a) If the department director refuses to file a document delivered to the department director for filing, the domestic or foreign corporation may appeal the refusal within thirty days after the return of the d…

D. Derivative Proceedings [§414-171] Definitions. As used in this subpart: "Derivative proceeding" means a civil suit in the right of a domestic corporation or, to the extent provided in section 414-178, in the right of a foreign corporation. "Shareholder" includes a beneficial o…

[§414-172] Standing. A shareholder may 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 who was …

[§414-173] Demand. No shareholder may 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 demand was made unless the shareholder has earlier been notified that …

[§414-174] Stay of proceedings. If the corporation commences an inquiry into the allegations made in the demand or complaint, the court may stay any derivative proceeding for a period that the court deems appropriate. [L 2000, c 244, pt of §1]

[§414-175] Dismissal. (a) A derivative proceeding shall be dismissed by the court on motion by the corporation if one of the groups specified in subsection (b) or (f) has determined in good faith after conducting a reasonable inquiry upon which its conclusions are based that the …

[§414-176] Discontinuance or settlement. A derivative proceeding may not be discontinued or settled without the 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 cl…

[§414-177] Payment of expenses. On termination of the derivative proceeding the court may: (1) Order the corporation to pay the plaintiff's reasonable expenses (including counsel fees) incurred in the proceeding if it finds that the proceeding has resulted in a substantial benefi…

[§414-178] Applicability to foreign corporations. In any derivative proceeding in the right of a foreign corporation, the matters covered by this subpart shall be governed by the laws of the jurisdiction of incorporation of the foreign corporation except for sections 414-174, 414…

[§414-18] Evidentiary effect of copy of filed document. A certificate attached to a copy of a document filed by the department director, bearing the department director's signature (which may be in facsimile) and the seal of the department of commerce and consumer affairs, is con…

[§414-19] Certificates and certified copies to be received in evidence. All certificates issued by the department director pursuant to this chapter, and all copies of documents filed in the department director's office pursuant to this chapter when certified by the department dir…

PART IX. DIRECTORS AND OFFICERS A. Board of Directors [§414-191] Requirement for and duties of board of directors. (a) Except as provided in section 414-163, each corporation must have a board of directors. (b) All corporate powers shall be exercised by or under the authority of,…

[§414-192] Qualifications of directors. The articles of incorporation or bylaws may prescribe qualifications for directors. A director need not be a resident of this State or a shareholder of the corporation unless the articles of incorporation or bylaws so prescribe. [L 2000, c …

[§414-193] Number and election of directors. (a) A board of directors must consist of one or more individuals, with the number specified in or fixed in accordance with the articles of incorporation or bylaws. (b) If a board of directors has power to fix or change the number of di…

[§414-194] Election of directors by certain classes of shareholders. 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 classe…

[§414-195] Terms of directors generally. (a) The terms of the initial directors of a corporation expire at the first shareholders' meeting at which directors are elected. (b) The terms of all other directors expire at the next annual shareholders' meeting following their election…

[§414-196] Staggered terms for directors. If there are nine or more directors, the articles of incorporation may provide for staggering their terms by dividing the total number of directors into two or three groups, with each group containing one-half or one-third of the total, a…

§414-197 Resignation of directors. (a) A director may resign at any time by delivering notice given in writing or by electronic transmission to the board of directors, its chairperson, or the corporation. (b) A resignation is effective when the notice is delivered unless the noti…

[§414-198] Removal of directors by shareholders. (a) The shareholders may remove one or more directors with or without cause unless the articles of incorporation provide that directors may be removed only for cause. (b) If a director is elected by a voting group of shareholders, …

[§414-199] Removal of directors by judicial proceeding. (a) The circuit court may remove a director of the corporation from office in a proceeding commenced either by the corporation or by its shareholders holding at least ten per cent of the outstanding shares of any class if th…

[§414-2] Reservation of power to amend or repeal. The legislature has the power to amend or repeal all or part of this chapter at any time and all domestic and foreign corporations subject to this chapter are governed by the amendment or repeal. [L 2000, c 244, pt of §1]