Arizona Laws 10-3810. Removal of directors by judicial proceeding
A. The court in the county where a corporation‘s known place of business or, if none in this state, its statutory agent is located may remove a director of the corporation from office in a proceeding commenced either by the corporation or by its members holding at least twenty-five per cent of the voting power of any class, if the court finds that both:
Terms Used In Arizona Laws 10-3810
- Articles of incorporation: means the original or restated articles of incorporation or articles of merger and all amendments to the articles of incorporation or merger and includes amended and restated articles of incorporation and articles of amendment and merger. See Arizona Laws 10-140
- Bylaws: means the code of rules adopted for the regulation or management of the affairs of the corporation irrespective of the name by which those rules are designated. See Arizona Laws 10-140
- Class: refers to a group of memberships that have the same rights with respect to voting, dissolution, redemption and transfer. See Arizona Laws 10-3140
- 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.
- Court: means the superior court of this state. See Arizona Laws 10-140
- Defendant: In a civil suit, the person complained against; in a criminal case, the person accused of the crime.
- Known place of business: means the known place of business required to be maintained pursuant to section 10-501. See Arizona Laws 10-140
- Plaintiff: The person who files the complaint in a civil lawsuit.
- Proceeding: includes a civil suit and a criminal, administrative and investigatory action. See Arizona Laws 10-140
- Voting power: means the total number of votes entitled to be cast for the election of directors at the time the determination of voting power is made, excluding a vote that is contingent on the happening of a condition or event that has not occurred at the time. See Arizona Laws 10-3140
1. The director engaged in fraudulent conduct or intentional criminal conduct with respect to the corporation.
2. Removal is in the best interests 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, but in no event may the period exceed five years.
C. If members commence a proceeding under subsection A, they shall make the corporation a party defendant, unless the corporation elects to become a party plaintiff.
D. The articles of incorporation or bylaws of a corporation organized for religious purposes may limit or prohibit the application of this section.