§ 7-108-404 — Limitation of certain remedies - definition

(1) An action by the
corporation or by the board of directors is not void or voidable, and shall not be
enjoined or set aside in a proceeding by a shareholder or by or in the right of the
corporation, because one or more precluded directors was present at or
participated in the meeting of the board of directors at which the action was
authorized, approved, or ratified, or executed a consent for the action in the manner
provided in section 7-108-202, if the action was authorized, approved, or ratified:

(a) At a meeting, by the affirmative vote of the number of directors present
at the meeting that would be sufficient to take action at the meeting under articles
101 to 117 of this title 7 or the bylaws; except that, in determining how many votes
would be sufficient, the vote of a precluded director is not counted for purposes of
authorizing the action but the director is considered present for purposes of
determining a quorum; or

(b) Without a meeting by written consent pursuant to section 7-108-202 and
executed by all of the directors, if the number of directors, not including any
precluded director, constitutes not less than a majority of all of the directors or
such greater number of directors as is required by articles 101 to 117 of this title 7 or
the bylaws.

(2) In this section, precluded director means a director who violated one or
more of the standards of liability set forth in section 7-108-402 (1) with respect to
an action described in subsection (1) of this section.

Legislative History

Source: L. 2019: Entire part amended with relocations, (SB 19-086), ch. 166, p. 1932, � 35, effective July 1, 2020.