Utah Code 16-10a-841. Limitation of liability of directors
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(1) Without limiting the generality of Subsection 16-10a-840(4), if so provided in the articles of incorporation or in the bylaws or a resolution to the extent permitted in Subsection (3), a corporation may eliminate or limit the liability of a director to the corporation or to its shareholders for monetary damages for any action taken or any failure to take any action as a director, except liability for:
Terms Used In Utah Code 16-10a-841
- Amendment: A proposal to alter the text of a pending bill or other measure by striking out some of it, by inserting new language, or both. Before an amendment becomes part of the measure, thelegislature must agree to it.
- Articles of incorporation: include :(4)(a) amended and restated articles of incorporation;(4)(b) articles of merger; and(4)(c) a document of a similar import to those described in Subsections (4)(a) and (b). See Utah Code 16-10a-102
- Bylaws: includes amended bylaws and restated bylaws. See Utah Code 16-10a-102
- 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.
- Damages: Money paid by defendants to successful plaintiffs in civil cases to compensate the plaintiffs for their injuries.
- Foreign corporation: means a corporation for profit incorporated under a law other than the law of this state. 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
- Voting group: means all shares of one or more classes or series that under the articles of incorporation or this chapter are entitled to vote and be counted together collectively on a matter at a meeting of shareholders. See Utah Code 16-10a-102
(1)(a) the amount of a financial benefit received by a director to which he is not entitled;(1)(b) an intentional infliction of harm on the corporation or the shareholders;(1)(c) a violation of Section 16-10a-842; or(1)(d) an intentional violation of criminal law.
(2) No provision authorized under this section may eliminate or limit the liability of a director for any act or omission occurring prior to the date when the provision becomes effective.
(3) Any provision authorized under this section to be included in the articles of incorporation may also be adopted in the bylaws or by resolution, but only if the provision is approved by the same percentage of shareholders of each voting group as would be required to approve an amendment to the articles of incorporation including the provision.
(4) Any foreign corporation authorized to transact business in this state, including any federally chartered depository institution authorized under federal law to transact business in this state, may adopt any provision authorized under this section.
(5) With respect to a corporation that is a depository institution regulated by the Department of Financial Institutions or by an agency of the federal government, any provision authorized under this section may include the elimination or limitation of the personal liability of a director or officer to the corporation’s members or depositors.