§55-8-09. Removal of directors by judicial proceeding

(a)        The superior court of the county where a corporation's principal office (or, if none in this State, its registered office) is located may remove a director of the corporation from office in a proceeding commenced either by the corporation or by its shareholders holding at least ten percent (10%) of the outstanding shares of any class 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; and

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

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

(c)        If shareholders commence a proceeding under subsection (a), they shall make the corporation a party defendant.

(1955, c. 1371, s. 1; 1959, c. 1316, s. 34; 1973, c. 469, s. 7; 1989, c. 265, s. 1.)