Utah Code 16-10a-809. Removal of directors by judicial proceeding

(1)

The district court of the county in this state where a corporation‘s principal office is located or, if it has no principal office in this state, the district court for Salt Lake County may remove a director in a proceeding commenced either by the corporation or by its shareholders holding at least 10% of the outstanding shares of any class if the court finds that:

Terms Used In Utah Code 16-10a-809

Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
Defendant: In a civil suit, the person complained against; in a criminal case, the person accused of the crime.
Deliver: includes delivery by mail or another means of transmission authorized by Section 16-10a-103, except that delivery to the division means actual receipt by the division. See Utah Code 16-10a-102
Division: means the Division of Corporations and Commercial Code. See Utah Code 16-10a-102
Principal office: means the office, in or out of this state, designated by a domestic or foreign corporation as its principal office in the most recent document on file with the division providing the information, including:

(a)	an annual report;

(b)	an application for a certificate of authority; or

(c)

a notice of change of principal office. See Utah Code 16-10a-102

Proceeding: includes :

(a)	a civil suit;

(b)	arbitration or mediation; and

(c)	a criminal, administrative, or investigatory action. See Utah Code 16-10a-102 State: when applied to the different parts of the United States, includes a state, district, or territory of the United States. See Utah Code 68-3-12.5
(a)	the director engaged in fraudulent or dishonest conduct or gross abuse of authority or discretion with respect to the corporation; and

(b)	removal is in the best interest of the corporation.

(2)	The court that removes a director may bar the director from reelection for a period prescribed by the court.

(3)	If shareholders commence a proceeding under Subsection (1), they shall make the corporation a party defendant.

(4)	A director who is removed pursuant to this section may deliver to the division for filing a statement to that effect pursuant to Section 16-10a-1608.

Amended by Chapter 364, 2008 General Session

Previous section

Next section

Part 8 Contents