US Laws, Codes, Statutes & Cases

 
  § 715. Interested directors and officers.
    (a)  No contract or other transaction between a corporation and one or
  more of its directors or officers, or  between  a  corporation  and  any
  other  corporation,  firm,  association  or other entity in which one or
  more of its directors or officers are directors or officers, or  have  a
  substantial  financial  interest,  shall  be either void or voidable for
  this reason alone or by reason alone that such director or directors  or
  officer  or  officers  are  present at the meeting of the board, or of a
  committee thereof, which authorizes such  contract  or  transaction,  or
  that his or their votes are counted for such purpose:
    (1)  If the material facts as to such director's or officer's interest
  in such contract or transaction and as to any such common  directorship,
  officership  or  financial interest are disclosed in good faith or known
  to the board or committee, and the board or  committee  authorizes  such
  contract  or  transaction  by a vote sufficient for such purpose without
  counting the vote or votes of such interested director or officer; or
    (2) If the material facts as to such director's or officer's  interest
  in  such contract or transaction and as to any such common directorship,
  officership or financial interest are disclosed in good faith  or  known
  to  the  members  entitled to vote thereon, if any, and such contract or
  transaction is authorized by vote of such members.
    (b) If such good faith disclosure of the  material  facts  as  to  the
  director's  or  officer's interest in the contract or transaction and as
  to any such common directorship, officership or financial  interest,  is
  made  to the directors or members, or known to the board or committee or
  members  authorizing  such  contract  or  transaction,  as  provided  in
  paragraph  (a),  the  contract  or transaction may not be avoided by the
  corporation for the reasons set forth in paragraph (a). If there was  no
  such disclosure or knowledge, or if the vote of such interested director
  or  officer  was  necessary  for  the  authorization of such contract or
  transaction at a meeting of the board  or  committee  at  which  it  was
  authorized, the corporation may avoid the contract or transaction unless
  the  party  or  parties  thereto  shall establish affirmatively that the
  contract or transaction was fair and reasonable as to the corporation at
  the time it was authorized by the board, a committee or the members.
    (c) Common or interested directors may be counted in  determining  the
  presence  of  a quorum at a meeting of the board or of a committee which
  authorizes such contract or transaction.
    (d)  The  certificate  of   incorporation   may   contain   additional
  restrictions  on contracts or transactions between a corporation and its
  directors or officers or other persons and may provide that contracts or
  transactions  in  violation  of  such  restrictions  shall  be  void  or
  voidable.
    (e)  Unless  otherwise provided in the certificate of incorporation or
  the by-laws, the board shall have authority to fix the  compensation  of
  directors for services in any capacity.
    (f)  The fixing of salaries of officers, if not done in or pursuant to
  the by-laws, shall require the affirmative vote of  a  majority  of  the
  entire  board  unless  a  higher proportion is set by the certificate of
  incorporation or by-laws.