414D-140 Removal of directors by judicial proceeding. (a) The circuit court of the county where a corporation's principal office is located may remove any director of the corporation from office in a proceeding commenced either by the corporation or its members holding at least ten per cent of the voting power of any class, or the attorney general in the case of a public benefit corporation, if the court finds that with respect to the corporation, the director's removal is in the best interest of the corporation due to:

(1) The director's fraudulent or dishonest conduct;

(2) The director's gross abuse of authority or discretion; or

(3) A final judgment finding that the director has violated a duty set forth in sections 414D-149 and 414D-152, and that 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 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), within ten days of its commencement, they shall give the attorney general written notice of the proceeding. [L 2001, c 105, pt of 1; am L 2004, c 171, 7]

 

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