2006 Utah Code - 31A-5-416 — Executive compensation.

     31A-5-416.   Executive compensation.
     (1) Subject to this section, Section 16-10a-302, except Subsection 16-10a-302(13), applies to stock and mutual corporations.
     (2) Shareholders' approval is required of any benefit or payment to a director or officer for services rendered to a stock corporation more than 90 days before the agreement or decision to give the benefit or make the payment, unless the benefit or payment is made under a plan approved by the shareholders. Shareholder approval is also required for a new pension plan, profit-sharing plan, stock option plan, or an amendment to an existing plan which, so far as it pertains to any director or officer, substantially increases the financial burden on the corporation.
     (3) An action taken by the board of a mutual on the compensation of officers, directors, or employees, other than setting individual salaries or standards for salaries of classes of employees, shall be reported to the commissioner within 30 days.
     (4) The annual report to the commissioner shall include the amount of all direct and indirect remuneration for services, including retirement and other deferred compensation benefits and stock options, paid or accrued each year:
     (a) for the benefit of each director, each officer, and employee whose remuneration exceeds an amount established by the commissioner by rule;
     (b) for all directors and officers as a group; and
     (c) for the five most highly compensated officers, directors, and employees.
     (5) No arrangement for compensation or other employment benefits for any director, officer, or employee with decision-making power may be made if it would:
     (a) measure the compensation or other benefits in whole or in part by any criteria that would create a financial inducement to act contrary to the best interests of the corporation; or
     (b) have a tendency to make the corporation depend for continuance or soundness of operation upon the continuation of any director, officer, or employee in his position.
     (6) Except for the insurer, no person having any authority in the investment or disposition of the funds of a domestic insurer may accept any fee, brokerage, gift, or other emolument because of any investment, loan, deposit, purchase, sale, payment, or exchange made by or for the insurer, nor may that person be financially interested in the investment or disposition of funds in any capacity.
     (7) Unless the commissioner, acting in the corporation's best interests, orders otherwise, if an order of rehabilitation or liquidation is issued under Section 31A-27-303 or Section 31A-27-310, the contractual obligations of the insurer for unperformed services of any director, principal officer, or person performing similar functions or having similar powers are terminated. This subsection does not apply to obligations vested before July 1, 1986.

Amended by Chapter 277, 1992 General Session