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Hawaii Revised Statutes 414D-150 - Director conflict of interest

Hawaii Revised Statutes > Division 2 > Title 23 > Chapter 414D > Part VIII > § 414D-150 - Director conflict of interest


Current as of: 2010

  (a)  A conflict of interest transaction is a transaction with the corporation in which a director of the corporation has a direct or indirect interest.  A conflict of interest transaction is not voidable or the basis for imposing liability on the director if the transaction was fair at the time it was entered into or is approved as provided in subsection (b).

     (b)  A transaction in which a director has a conflict of interest may be approved if:

     (1)  In the case of a public benefit corporation, the transaction is approved by the attorney general, before or after the transaction is consummated;

     (2)  The material facts of the transaction and the director's interest were disclosed or known to the board of directors or a committee of the board and the transaction was authorized, approved, or ratified by the board or committee of the board; or

     (3)  The material facts of the transaction and the director's interest were disclosed or known to the members and they authorized, approved, or ratified the transaction.

     (c)  For purposes of this section, a director of the corporation has an indirect interest in a transaction if:

     (1)  Another entity in which the director has a material interest or in which the director is a general partner is a party to the transaction; or

     (2)  Another entity of which the director is a director, officer, or trustee is a party to the transaction.

     (d)  For purposes of subsection (b), a conflict of interest transaction is authorized, approved, or ratified if it receives the affirmative vote of a majority of the directors either on the board or on the committee, who have no direct or indirect interest in the transaction; provided that a transaction may not be authorized, approved, or ratified under this section by a single director.  If a majority of the directors on the board who have no direct or indirect interest in the transaction vote to authorize, approve, or ratify the transaction, a quorum is present for the purpose of taking action under this section.  The presence of or a vote cast by a director with a direct or indirect interest in the transaction does not affect the validity of any action taken under subsection

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See also:

Hawaii Revised Statutes Chapter 414D - Hawaii Nonprofit Corporations Act

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