§ 7-6-26.1 - Director conflicts of interest.
SECTION 7-6-26.1
§ 7-6-26.1 Director conflicts of interest.– (a) No contract or transaction between a corporation and one or more of itsdirectors or officers, or between a corporation and any other corporation,partnership, association, or other organization in which one or more of itsdirectors or officers are directors or officers or have a financial interest,is void or voidable nor are the directors or officers liable regarding thecontract or transaction solely for this reason, or solely because the directoror officer is present at or participates in the meeting of the board orcommittee of the board which authorizes the contract or transaction, or solelybecause his, her, or their votes are counted for the purpose, if:
(1) The material facts as to his, her, or their interest orrelationship are disclosed or are known to the board of directors or thecommittee, and the board of directors or committee authorizes, approves, orratifies the contract or transaction by the affirmative votes of a majority ofthe disinterested directors, even though the disinterested directors are lessthan a quorum; or
(2) The material facts as to his, her, or their interest orrelationship are disclosed or are known to the members entitled to vote on thecontract or transaction, and the contract or transaction is specificallyauthorized, approved, or ratified by vote of the members; or
(3) The contract or transaction is fair and reasonable to thecorporation.
(b) Common or interested directors may be counted indetermining the presence of a quorum at a meeting of the board of directors orof a committee which authorizes the contract or transaction.