Removal of directors by judicial proceeding

(a) Any court of record having equity jurisdiction in the county where a corporation's principal office (or if none in this state, its registered office) is located may remove any director of the corporation from office in a proceeding commenced either by the corporation, its members holding at least ten percent (10%) of the voting power of any class or the attorney general and reporter in the case of a public benefit corporation if the court finds that: (1) The director engaged in fraudulent or dishonest conduct, or gross abuse of authority or discretion, with respect to the corporation, or a final judgment has been entered finding that the director has violated a duty set forth in part 3 of this chapter; and (2) Removal is in the best interest of the corporation. (b) The court that removes a director may bar the director from serving on the board for a period prescribed by the court. (c) If members or the attorney general and reporter commence a proceeding under subsection (a), the corporation shall be made a party defendant. (d) If a public benefit corporation or its members commence a proceeding under subsection (a), they shall give the attorney general and reporter written notice of the proceeding. Acts 1987, ch. 242, § 8.10.

(a) Any court of record having equity jurisdiction in the county where a corporation's principal office (or if none in this state, its registered office) is located may remove any director of the corporation from office in a proceeding commenced either by the corporation, its members holding at least ten percent (10%) of the voting power of any class or the attorney general and reporter in the case of a public benefit corporation if the court finds that: (1) The director engaged in fraudulent or dishonest conduct, or gross abuse of authority or discretion, with respect to the corporation, or a final judgment has been entered finding that the director has violated a duty set forth in part 3 of this chapter; and (2) Removal is in the best interest of the corporation.

(1) The director engaged in fraudulent or dishonest conduct, or gross abuse of authority or discretion, with respect to the corporation, or a final judgment has been entered finding that the director has violated a duty set forth in part 3 of this chapter; and

(2) Removal is in the best interest of the corporation.

(b) The court that removes a director may bar the director from serving on the board for a period prescribed by the court.

(c) If members or the attorney general and reporter commence a proceeding under subsection (a), the corporation shall be made a party defendant.

(d) If a public benefit corporation or its members commence a proceeding under subsection (a), they shall give the attorney general and reporter written notice of the proceeding.

Acts 1987, ch. 242, § 8.10.