2013 Vermont Statutes
Title 11A Vermont Business Corporations
Chapter 8 DIRECTORS AND OFFICERS
§ 8.62 Directors' action

8.62. Directors' action

(a) Directors' action respecting a director's conflicting interest transaction is effective for purposes of subdivision 8.61(b)(1) of this title if the transaction has been authorized by the affirmative vote of a majority, but no fewer than two, of the qualified directors who voted on the transaction after required disclosure by the conflicted director of information not already known by such qualified directors, or after modified disclosure in compliance with subsection (b) of this section, provided that:

(1) the qualified directors have deliberated and voted outside the presence of and without the participation by any other director; and

(2) where the action has been taken by a committee, all members of the committee were qualified directors, and either:

(A) the committee was composed of all the qualified directors on the board of directors; or

(B) the members of the committee were appointed by the affirmative vote of a majority of the qualified directors on the board.

(b) Notwithstanding subsection (a) of this section, when a transaction is a director's conflicting interest transaction only because a related person described in subdivisions 8.60(5)(E) and (F) of this title is a party to or has a material financial interest in the transaction, the conflicted director is not obligated to make required disclosure to the extent that the director reasonably believes that doing so would violate a duty imposed under law, a legally enforceable obligation of confidentiality, or a professional ethics rule, provided that the conflicted director discloses to the qualified directors voting on the transaction:

(1) all information required to be disclosed that is not so violative;

(2) the existence and nature of the director's conflicting interest; and

(3) the nature of the conflicted director's duty not to disclose the confidential information.

(c) A majority, but no fewer than two, of all the qualified directors on the board of directors or on the committee constitutes a quorum for purposes of action that complies with this section.

(d) Where directors' action under this section does not satisfy a quorum or voting requirement applicable to the authorization of the transaction by reason of the articles of incorporation, the bylaws, or a provision of law, independent action to satisfy those authorization requirements must be taken by the board of directors or a committee, in which action directors who are not qualified directors may participate. (Added 1993, No. 85, 2, eff. Jan. 1, 1994; amended 2007, No. 190 (Adj. Sess.), 97, eff. June 6, 2008.)