reglab/statecodes huggingface dataset:
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 6. Shares and Distributions › 35-14-630. Preemptive rights -- shareholder

35-14-630. Preemptive rights -- shareholder.
(1) The shareholders of a corporation do not have a preemptive right to acquire the corporation's unissued shares, except to the extent the articles of incorporation provide that right.
(2) A statement included in the articles of incorporation that "the corporation elects to have preemptive rights", or words of similar effect, means that the following principles apply, except to the extent the articles of incorporation expressly provide otherwise:
(a) The shareholders of the corporation have a preemptive right, granted on uniform terms and conditions prescribed by the board of directors to provide a fair and reasonable opportunity to exercise the right, to acquire proportional amounts of the corporation's unissued shares upon the decision of the board of directors to issue them.
(b) A preemptive right may be waived by a shareholder. A waiver evidenced by a writing is irrevocable even though it is not supported by consideration.
(c) There is no preemptive right with respect to:
(i) shares issued as compensation to directors, officers, employees, or agents of the corporation or its subsidiaries or affiliates;
(ii) shares issued to satisfy conversion or option rights created to provide compensation to directors, officers, employees, or agents of the corporation or its subsidiaries or affiliates;
(iii) shares authorized in the articles of incorporation that are issued within 6 months from the effective date of incorporation; or
(iv) shares sold otherwise than for cash.
(d) Holders of shares of any class or series without voting power but with preferential rights to distributions have no preemptive rights with respect to shares of any class or series.
(e) Holders of shares of any class or series with voting power but without preferential rights to distributions have no preemptive rights with respect to shares of any class or series with preferential rights to distributions unless the shares with preferential rights are convertible into or carry a right to subscribe for or acquire the shares without preferential rights.
(f) Shares subject to preemptive rights that are not acquired by shareholders may be issued to any person for a period of 1 year after being offered to shareholders at a consideration set by the board of directors that is not lower than the consideration set for the exercise of preemptive rights. An offer at a lower consideration or after the expiration of 1 year is subject to the shareholders' preemptive rights.
(3) For purposes of this section, "shares" includes a security convertible into or carrying a right to subscribe for or acquire shares.
History: En. Sec. 58, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 6. Shares and Distributions › 35-14-631. Corporation's acquisition of its own shares

35-14-631. Corporation's acquisition of its own shares.
(1) A corporation may acquire its own shares, and shares so acquired constitute authorized but unissued shares.
(2) If the articles of incorporation prohibit the reissue of the acquired shares, the number of authorized shares is reduced by the number of shares acquired.
History: En. Sec. 59, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 7. Shareholders › 35-14-701. Annual meeting

35-14-701. Annual meeting.
(1) Unless directors are elected by written consent in lieu of an annual meeting as permitted by 35-14-704, a corporation shall hold a meeting of shareholders annually at a time stated in or fixed in accordance with the bylaws at which directors must be elected.
(2) Unless the board of directors determines to hold the meeting solely by means of remote communication in accordance with 35-14-709(3), annual meetings may be held:
(a) in or out of this state at the place stated in or fixed in accordance with the bylaws; or
(b) if no place is stated in or fixed in accordance with the bylaws, at the corporation's principal office.
(3) The failure to hold an annual meeting at the time stated in or fixed in accordance with a corporation's bylaws does not affect the validity of any corporate action.
History: En. Sec. 61, Ch. 271, L. 2019; amd. Sec. 2, Ch. 34, L. 2021.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 7. Shareholders › 35-14-702. Special meeting

35-14-702. Special meeting.
(1) A corporation shall hold a special meeting of shareholders:
(a) on call of its board of directors or of the person or persons authorized to do so by the articles of incorporation or bylaws; or
(b) if shareholders holding at least 10% of all the votes entitled to be cast on an issue proposed to be considered at the proposed special meeting sign, date, and deliver to the corporation one or more written demands for the meeting describing the purpose or purposes for which it is to be held, provided that the articles of incorporation may fix a lower percentage or a higher percentage, not exceeding 25%, of all the votes entitled to be cast on any issue proposed to be considered. Unless otherwise provided in the articles of incorporation, a written demand for a special meeting may be revoked by a writing to that effect received by the corporation before the receipt by the corporation of demands sufficient in number to require the holding of a special meeting.
(2) If not otherwise fixed under 35-14-703 or 35-14-707, the record date for determining shareholders entitled to demand a special meeting is the first date on which a signed shareholder demand is delivered to the corporation. No written demand for a special meeting is effective unless, within 60 days of the earliest date on which the demand delivered to the corporation as required by this section was signed, written demands signed by shareholders holding at least the percentage of votes specified in or fixed in accordance with subsection (1)(b) have been delivered to the corporation.
(3) Unless the board of directors determines to hold the meeting solely by remote participation in accordance with 35-14-709(3), special meetings of shareholders may be held:
(a) in or out of this state at the place stated in or fixed in accordance with the bylaws; or
(b) if no place is stated in or fixed in accordance with the bylaws, at the corporation's principal office.
(4) Only business within the purpose or purposes described in the meeting notice required by 35-14-705(3) may be conducted at a special meeting of shareholders.
History: En. Sec. 62, Ch. 271, L. 2019; amd. Sec. 3, Ch. 34, L. 2021.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 7. Shareholders › 35-14-703. Court-ordered meeting

35-14-703. Court-ordered meeting.
(1) The district court of the county where a corporation's principal office is located or, if its principal office is not located in this state, of the first judicial district may summarily order a meeting to be held:
(a) on application of any shareholder of the corporation if an annual meeting was not held or action by written consent in lieu of an annual meeting did not become effective within the earlier of 6 months after the end of the corporation's fiscal year or 15 months after its last annual meeting; or
(b) on application of one or more shareholders who signed a demand for a special meeting valid under 35-14-702 if:
(i) notice of the special meeting was not given within 30 days after the first day on which the requisite number of demands was delivered to the corporation; or
(ii) the special meeting was not held in accordance with the notice.
(2) The court may fix the time and place of the meeting, determine the shares entitled to participate in the meeting, specify a record date or dates for determining shareholders entitled to notice of and to vote at the meeting, prescribe the form and content of the meeting notice, fix the quorum required for specific matters to be considered at the meeting or direct that the shares represented at the meeting constitute a quorum for action on those matters, and enter other orders necessary to accomplish the purpose or purposes of the meeting.
(3) For purposes of subsection (1)(a), "shareholder" means a record shareholder, a beneficial shareholder, and an unrestricted voting trust beneficial owner.
History: En. Sec. 63, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 7. Shareholders › 35-14-705. Notice of meeting

35-14-705. Notice of meeting.
(1) A corporation shall notify shareholders of the date, time, and place, if any, of each annual and special shareholders' meeting no fewer than 10 or more than 60 days before the meeting date. If the board of directors has authorized participation by means of remote communication pursuant to 35-14-709 for holders of any class or series of shares, the notice to the holders of that class or series of shares must describe the means of remote communication to be used. The notice must include the record date for determining the shareholders entitled to vote at the meeting if that date is different from the record date for determining shareholders entitled to notice of the meeting. Unless this chapter or the articles of incorporation require otherwise, the corporation is required to give notice only to shareholders entitled to vote at the meeting as of the record date for determining the shareholders entitled to notice of the meeting.
(2) Unless this chapter or the articles of incorporation require otherwise, the notice of an annual meeting of shareholders need not include a description of the purpose or purposes for which the meeting is called.
(3) Notice of a special meeting of shareholders must include a description of the purpose or purposes for which the meeting is called.
(4) If not otherwise fixed under 35-14-703 or 35-14-707, the record date for determining shareholders entitled to notice of and to vote at an annual or special shareholders' meeting is the day before the first notice is delivered to shareholders.
(5) Unless the bylaws require otherwise, if an annual or special shareholders' meeting is adjourned to a different date, time, or place, if any, notice need not be given of the new date, time, or place, if any, if the new date, time, or place, if any, is announced at the meeting before adjournment. If a new record date for the adjourned meeting is or must be fixed under 35-14-707, however, notice of the adjourned meeting must be given under this section to shareholders entitled to vote at the adjourned meeting as of the record date fixed for notice of the adjourned meeting.
History: En. Sec. 65, Ch. 271, L. 2019; amd. Sec. 4, Ch. 34, L. 2021.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 7. Shareholders › 35-14-706. Waiver of notice

35-14-706. Waiver of notice.
(1) A shareholder may waive any notice required by this chapter or the articles of incorporation or bylaws, before or after the date and time stated in the notice. The waiver must be in writing, be signed by the shareholder entitled to the notice, and be delivered to the corporation for filing by the corporation with the minutes or corporate records.
(2) A shareholder's attendance at a meeting:
(a) waives objection to lack of notice or defective notice of the meeting unless the shareholder, at the beginning of the meeting, objects to holding the meeting or transacting business at the meeting; and
(b) waives objection to consideration of a particular matter at the meeting that is not within the purpose or purposes described in the meeting notice unless the shareholder objects to considering the matter when it is presented.
History: En. Sec. 66, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 7. Shareholders › 35-14-707. Record date for meeting

35-14-707. Record date for meeting.
(1) The bylaws may fix or provide the manner of fixing the record date or dates for one or more voting groups to determine the shareholders entitled to notice of a shareholders' meeting, to demand a special meeting, to vote, or to take any other action. If the bylaws do not fix or provide for fixing a record date, the board of directors may fix the record date.
(2) A record date fixed under this section may not be more than 70 days before the meeting or action requiring a determination of shareholders and may not be retroactive.
(3) A determination of shareholders entitled to notice of or to vote at a shareholders' meeting is effective for any adjournment of the meeting unless the board of directors fixes a new record date or dates, which it shall do if the meeting is adjourned to a date more than 120 days after the date fixed for the original meeting.
(4) If a court orders a meeting adjourned to a date more than 120 days after the date fixed for the original meeting, it may provide that the original record date or dates continue in effect or it may fix a new record date or dates.
(5) The record dates for a shareholders' meeting fixed by or in the manner provided in the bylaws or by the board of directors is the record date for determining shareholders entitled both to notice of and to vote at the shareholders' meeting unless, in the case of a record date fixed by the board of directors and to the extent not prohibited by the bylaws, the board, at the time it fixes the record date for shareholders entitled to notice of the meeting, fixes a later record date on or before the date of the meeting to determine the shareholders entitled to vote at the meeting.
History: En. Sec. 67, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 7. Shareholders › 35-14-708. Conduct of meeting

35-14-708. Conduct of meeting.
(1) At each meeting of shareholders, a chair shall preside. The chair must be appointed as provided in the bylaws or, in the absence of that provision, by the board of directors.
(2) The chair, unless the articles of incorporation or bylaws provide otherwise, shall determine the order of business and may establish rules for the conduct of the meeting.
(3) Rules adopted for the meeting and the conduct of the meeting must be fair to shareholders.
(4) The chair of the meeting shall announce at the meeting when the polls close for each matter voted on. If no announcement is made, the polls are considered to have closed on the final adjournment of the meeting. After the polls close, no ballots, proxies, or votes and no revocations or changes to ballots, proxies, or votes may be accepted.
History: En. Sec. 68, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 7. Shareholders › 35-14-709. Remote participation -- shareholder's meetings

35-14-709. Remote participation -- shareholder's meetings.
(1) Shareholders of any class or series of shares may participate in any meeting of shareholders by means of remote communication to the extent the board of directors authorizes the participation for that class or series. Participation as a shareholder by means of remote communication is subject to guidelines and procedures the board of directors adopts and must be in conformity with subsection (2).
(2) Shareholders participating in a shareholders' meeting by means of remote communication are considered present and may vote at the meeting if the corporation has implemented reasonable measures:
(a) to verify that each person participating remotely as a shareholder is a shareholder; and
(b) to provide those shareholders a reasonable opportunity to participate in the meeting and to vote on matters submitted to the shareholders, including an opportunity to communicate and to read or hear the proceedings of the meeting substantially concurrently with the proceedings.
(3) Unless the bylaws require the meeting of shareholders to be held at a place, the board of directors may determine that any meeting of shareholders may not be held at any place and must instead be held solely by means of remote communication, but only if the corporation implements the measures specified in subsection (1).
History: En. Sec. 69, Ch. 271, L. 2019; amd. Sec. 5, Ch. 34, L. 2021.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 7. Shareholders › 35-14-721. Voting entitlements of shares

35-14-721. Voting entitlements of shares.
(1) Except as provided in subsections (2) and (4) or unless the articles of incorporation provide otherwise, each outstanding share, regardless of class or series, is entitled to one vote on each matter voted on at a shareholders' meeting. Only shares are entitled to vote.
(2) Shares of a corporation are not entitled to vote if they are owned by or otherwise belong to the corporation:
(a) directly; or
(b) indirectly through an entity of which a majority of the voting power is held directly or indirectly by the corporation or that is otherwise controlled by the corporation.
(3) Shares held by the corporation in a fiduciary capacity for the benefit of any person are entitled to vote unless they are held for the benefit of or otherwise belong to the corporation:
(a) directly; or
(b) indirectly through an entity of which a majority of the voting power is held directly or indirectly by the corporation or that is otherwise controlled by the corporation.
(4) Redeemable shares are not entitled to vote after delivery of written notice of redemption is effective and a sum sufficient to redeem the shares has been deposited with a bank, trust company, or other financial institution under an irrevocable obligation to pay the holders the redemption price on surrender of the shares.
(5) For purposes of this section, "voting power" means the current power to vote in the election of directors of a corporation or to elect, select, or appoint governors of another entity.
History: En. Sec. 71, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 7. Shareholders › 35-14-722. Proxies

35-14-722. Proxies.
(1) A shareholder may vote the shareholder's shares in person or by proxy.
(2) A shareholder or the shareholder's agent or attorney-in-fact may appoint a proxy to vote or otherwise act for the shareholder by signing an appointment form or by an electronic transmission. An electronic transmission must contain or be accompanied by information from which the recipient can determine the date of the transmission and that the transmission was authorized by the sender or the sender's agent or attorney-in-fact.
(3) An appointment of a proxy is effective when a signed appointment form or an electronic transmission of the appointment is received by the inspector of election or the officer or agent of the corporation authorized to tabulate votes. An appointment is valid for the term provided in the appointment form and, if no term is provided, is valid for 11 months unless the appointment is irrevocable under subsection (4).
(4) An appointment of a proxy is revocable unless the appointment form or electronic transmission states that it is irrevocable and the appointment is coupled with an interest. Appointments coupled with an interest include the appointment of:
(a) a pledgee;
(b) a person who purchased or agreed to purchase the shares;
(c) a creditor of the corporation who extended it credit under terms requiring the appointment;
(d) an employee of the corporation whose employment contract requires the appointment; and
(e) a party to a voting agreement created under 35-14-731.
(5) The death or incapacity of the shareholder appointing a proxy does not affect the right of the corporation to accept the proxy's authority unless notice of the death or incapacity is received by the secretary or other officer or agent authorized to tabulate votes before the proxy exercises authority under the appointment.
(6) An appointment made irrevocable under subsection (4) is revoked when the interest with which it is coupled is extinguished.
(7) Unless it provides otherwise, an appointment made irrevocable under subsection (4) continues in effect after a transfer of the shares and after a transferee takes subject to the appointment, except that a transferee for value of shares subject to an irrevocable appointment may revoke the appointment if the transferee did not know of its existence when acquiring the shares and the existence of the irrevocable appointment was not noted conspicuously on the certificate representing the shares or on the information statement for shares without certificates.
(8) Subject to 35-14-724 and to any express limitation on the proxy's authority stated in the appointment form or electronic transmission, a corporation is entitled to accept the proxy's vote or other action as that of the shareholder making the appointment.
History: En. Sec. 72, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 7. Shareholders › 35-14-723. Shares held by intermediaries and nominees

35-14-723. Shares held by intermediaries and nominees.
(1) A corporation's board of directors may establish a procedure under which a person on whose behalf shares are registered in the name of an intermediary or nominee may elect to be treated by the corporation as the record shareholder by filing with the corporation a beneficial ownership certificate. The terms, conditions, and limitations of this treatment must be specified in the procedure. To the extent a person is treated under the procedure as having rights or privileges that the record shareholder otherwise would have, the record shareholder does not have those rights or privileges.
(2) The procedure must specify:
(a) the types of intermediaries or nominees to which it applies;
(b) the rights or privileges that the corporation recognizes in a person with respect to whom a beneficial ownership certificate is filed;
(c) the manner in which the procedure is selected, which must include that the beneficial ownership certificate must be signed or assented to by or on behalf of the record shareholder and the person on whose behalf the shares are held;
(d) the information that must be provided when the procedure is selected;
(e) the period for which selection of the procedure is effective;
(f) requirements for notice to the corporation with respect to the arrangement; and
(g) the form and contents of the beneficial ownership certificate.
(3) The procedure may specify any other aspects of the rights and duties created by the filing of a beneficial ownership certificate.
History: En. Sec. 73, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 7. Shareholders › 35-14-725. Quorum and voting requirements -- voting groups

35-14-725. Quorum and voting requirements -- voting groups.
(1) Shares entitled to vote as a separate voting group may take action on a matter at a meeting only if a quorum of those shares exists with respect to that matter. Unless the articles of incorporation provide otherwise, shares representing a majority of the votes entitled to be cast on the matter by the voting group constitute a quorum of that voting group for action on that matter. When this chapter requires a particular quorum for a specified action, the articles of incorporation may not provide for a lower quorum.
(2) Once a share is represented for any purpose at a meeting, it is considered present for quorum purposes for the remainder of the meeting and for any adjournment of that meeting unless a new record date is or must be fixed for that adjourned meeting.
(3) If a quorum exists, action on a matter, other than the election of directors, by a voting group is approved if the votes cast within the voting group favoring the action exceed the votes cast opposing the action unless the articles of incorporation or this chapter requires a greater number of affirmative votes.
(4) An amendment of the articles of incorporation adding, changing, or deleting a quorum or voting requirement for a voting group greater than specified in subsection (1) or (3) is governed by 35-14-727.
(5) The election of directors is governed by 35-14-728.
(6) When a provision of this chapter provides for voting of classes or series as separate voting groups, the rules provided in 35-14-1004 for amendments of the articles of incorporation apply to that provision.
History: En. Sec. 75, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 7. Shareholders › 35-14-726. Action by single and multiple voting groups

35-14-726. Action by single and multiple voting groups.
(1) If the articles of incorporation or this chapter provides for voting by a single voting group on a matter, action on that matter is taken when it is voted on by that voting group as provided in 35-14-725.
(2) If the articles of incorporation or this chapter provides for voting by two or more voting groups on a matter, action on that matter is taken only when it is voted on by each of those voting groups counted separately as provided in 35-14-725. Action may be taken by different voting groups on a matter at different times.
History: En. Sec. 76, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 7. Shareholders › 35-14-727. Modifying quorum or voting requirements

35-14-727. Modifying quorum or voting requirements.
An amendment to the articles of incorporation that adds, changes, or deletes a quorum or voting requirement must meet the same quorum requirement and be adopted by the same vote and voting groups required to take action under the quorum and voting requirements then in effect or proposed to be adopted, whichever is greater.
History: En. Sec. 77, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 7. Shareholders › 35-14-728. Voting for directors -- cumulative voting

35-14-728. Voting for directors -- cumulative voting.
(1) Unless otherwise provided in the articles of incorporation, directors are elected by a plurality of the votes cast by the shares entitled to vote in the election at a meeting at which a quorum is present.
(2) Shareholders do not have a right to cumulate their votes for directors unless the articles of incorporation provide for that right.
(3) A statement included in the articles of incorporation that "[all] [a designated voting group of] shareholders are entitled to cumulate their votes for directors" or words of similar meaning means that the shareholders designated are entitled to multiply the number of votes they are entitled to cast by the number of directors for whom they are entitled to vote and to cast the product for a single candidate or distribute the product among two or more candidates.
(4) Shares otherwise entitled to vote cumulatively may not be voted cumulatively at a particular meeting unless:
(a) the meeting notice or proxy statement accompanying the notice states conspicuously that cumulative voting is authorized; or
(b) a shareholder who has the right to cumulate the shareholder's votes gives notice to the corporation not less than 48 hours before the time set for the meeting of the shareholder's intent to cumulate votes during the meeting. If one shareholder gives this notice, all other shareholders in the same voting group participating in the election are entitled to cumulate their votes without giving further notice.
History: En. Sec. 78, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 7. Shareholders › 35-14-729. Inspectors of election

35-14-729. Inspectors of election.
(1) A corporation that has a class of equity securities registered pursuant to section 12 of the Securities Exchange Act of 1934 shall, and any other corporation may, appoint one or more inspectors to act at a meeting of shareholders in connection with determining voting results. Each inspector shall verify in writing that the inspector will faithfully execute the duties of inspector with strict impartiality and according to the best of the inspector's ability. An inspector may be an officer or employee of the corporation. The inspectors may appoint or retain other persons to assist the inspectors in the performance of the duties of inspector under subsection (2) and may rely on information provided by those and other persons, including those appointed to tabulate votes, unless the inspectors believe reliance is unwarranted.
(2) The inspectors shall:
(a) ascertain the number of shares outstanding and the voting power of each;
(b) determine the shares represented at a meeting;
(c) determine the validity of proxy appointments and ballots;
(d) count the votes; and
(e) make a written report of the results.
(3) In performing their duties, the inspectors may examine:
(a) the proxy appointment forms and any other information provided in accordance with 35-14-722(2);
(b) any envelope or related writing submitted with the proxy appointment forms;
(c) any ballots;
(d) any evidence or other information specified in 35-14-724; and
(e) the relevant books and records of the corporation relating to its shareholders and their entitlement to vote, including any securities position list provided by a depository clearing agency.
(4) The inspectors also may consider other information that they believe is relevant and reliable for the purpose of performing any of the duties assigned to them pursuant to subsection (2), including the purpose of evaluating inconsistent, incomplete, or erroneous information and reconciling information submitted on behalf of banks, brokers, their nominees, or similar persons that indicates more votes being cast than a proxy authorized by the record shareholder is entitled to cast. If the inspectors consider other information allowed by this subsection, they shall in their report under subsection (2) specify the information considered by them, including the purpose or purposes for which the information was considered, the person or persons from whom they obtained the information, when the information was obtained, the means by which the information was obtained, and the basis for the inspectors' belief that the information is relevant and reliable.
(5) Determinations of law by the inspectors of election are subject to de novo review by a court in a proceeding under 35-14-749 or other judicial proceeding.
History: En. Sec. 79, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 7. Shareholders › 35-14-730. Voting trusts

35-14-730. Voting trusts.
(1) One or more shareholders may create a voting trust, conferring on a trustee the right to vote or otherwise act for them, by signing an agreement setting out the provisions of the trust, which may include anything consistent with its purpose, and transferring their shares to the trustee. When a voting trust agreement is signed, the trustee shall prepare a list of the names and addresses of all voting trust beneficial owners, together with the number and class of shares each transferred to the trust, and deliver copies of the list and agreement to the corporation at its principal office.
(2) A voting trust becomes effective on the date the first shares subject to the trust are registered in the trustee's name.
(3) Limits, if any, on the duration of a voting trust are as set forth in the voting trust. A voting trust that became effective prior to June 1, 2020, remains governed by the statute concerning duration then in effect unless the voting trust is amended to provide otherwise by unanimous agreement of the parties to the voting trust.
History: En. Sec. 80, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 7. Shareholders › 35-14-731. Voting agreements

35-14-731. Voting agreements.
(1) Two or more shareholders may provide for the manner in which they will vote their shares by signing an agreement for that purpose. A voting agreement created under this section is not subject to the provisions of 35-14-730.
(2) A voting agreement created under this section is specifically enforceable.
History: En. Sec. 81, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 7. Shareholders › 35-14-740. Definitions -- derivative proceedings

35-14-740. Definitions -- derivative proceedings.
In 35-14-740 through 35-14-747, the following definitions apply:
(1) "Derivative proceeding" means a civil suit in the right of a domestic corporation or, to the extent provided in 35-14-747, in the right of a foreign corporation.
(2) "Shareholder" means a record shareholder, a beneficial shareholder, and an unrestricted voting trust beneficial owner.
History: En. Sec. 83, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 7. Shareholders › 35-14-741. Standing

35-14-741. Standing.
A shareholder may not commence or maintain a derivative proceeding unless the shareholder:
(1) was a shareholder of the corporation at the time of the act or omission complained of or became a shareholder through transfer by operation of law from one who was a shareholder at that time; and
(2) fairly and adequately represents the interests of the corporation in enforcing the right of the corporation.
History: En. Sec. 84, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 7. Shareholders › 35-14-742. Demand

35-14-742. Demand.
A shareholder may not commence a derivative proceeding until:
(1) a written demand has been made on the corporation to take suitable action; and
(2) 90 days have expired from the date delivery of the demand was made unless the shareholder has earlier been notified that the demand has been rejected by the corporation or unless irreparable injury to the corporation would result by waiting for the expiration of the 90-day period.
History: En. Sec. 85, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 7. Shareholders › 35-14-743. Stay of proceedings

35-14-743. Stay of proceedings.
If the corporation commences an inquiry into the allegations made in the demand or complaint, the court may stay any derivative proceeding for any period the court considers appropriate.
History: En. Sec. 86, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 7. Shareholders › 35-14-744. Dismissal

35-14-744. Dismissal.
(1) A derivative proceeding must be dismissed by the court on motion by the corporation if one of the groups specified in subsection (2) or (5) has determined in good faith, after conducting a reasonable inquiry on which its conclusions are based, that the maintenance of the derivative proceeding is not in the best interests of the corporation.
(2) Unless a panel is appointed pursuant to subsection (5), the determination in subsection (1) must be made by:
(a) a majority vote of qualified directors present at a meeting of the board of directors if the qualified directors constitute a quorum; or
(b) a majority vote of a committee consisting of two or more qualified directors appointed by majority vote of qualified directors present at a meeting of the board of directors, regardless of whether those qualified directors constitute a quorum.
(3) If a derivative proceeding is commenced after a determination has been made rejecting a demand by a shareholder, the complaint must allege with particularity facts establishing either:
(a) that a majority of the board of directors did not consist of qualified directors at the time the determination was made; or
(b) that the requirements of subsection (1) have not been met.
(4) If a majority of the board of directors consisted of qualified directors at the time the determination was made, the plaintiff has the burden of proving that the requirements of subsection (1) have not been met. If not, the corporation has the burden of proving that the requirements of subsection (1) have been met.
(5) Upon motion by the corporation, the court may appoint a panel of one or more individuals to make a determination whether the maintenance of the derivative proceeding is in the best interests of the corporation. In that case, the plaintiff has the burden of proving that the requirements of subsection (1) have not been met.
History: En. Sec. 87, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 7. Shareholders › 35-14-745. Discontinuance -- settlement

35-14-745. Discontinuance -- settlement.
A derivative proceeding may not be discontinued or settled without the court's approval. If the court determines that a proposed discontinuance or settlement will substantially affect the interests of the corporation's shareholders or a class or series of shareholders, the court shall direct that notice be given to the shareholders affected.
History: En. Sec. 88, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 7. Shareholders › 35-14-746. Payment of expenses

35-14-746. Payment of expenses.
On termination of the derivative proceeding, the court may:
(1) order the corporation to pay the plaintiff's expenses incurred in the proceeding if it finds that the proceeding has resulted in a substantial benefit to the corporation;
(2) order the plaintiff to pay any defendant's expenses incurred in defending the proceeding if it finds that the proceeding was commenced or maintained without reasonable cause or for an improper purpose; or
(3) order a party to pay an opposing party's expenses incurred because of the filing of a pleading, motion, or other paper if it finds that the pleading, motion, or other paper:
(a) was not well grounded in fact after reasonable inquiry or warranted by existing law or a good faith argument for the extension, modification, or reversal of existing law; or
(b) was interposed for an improper purpose, including to harass or to cause unnecessary delay or needless increase in the cost of litigation.
History: En. Sec. 89, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 7. Shareholders › 35-14-747. Applicability to foreign corporations

35-14-747. Applicability to foreign corporations.
In any derivative proceeding in the right of a foreign corporation, the matters covered by 35-14-740 through 35-14-747 are governed by the laws of the jurisdiction of incorporation of the foreign corporation except 35-14-743, 35-14-745, and 35-14-746.
History: En. Sec. 90, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 7. Shareholders › 35-14-748. Shareholder action to appoint custodian or receiver

35-14-748. Shareholder action to appoint custodian or receiver.
(1) The district court of the county where a corporation's principal office is located or, if its principal office is not located in this state, of the first judicial district may appoint one or more persons to be custodians, or, if the corporation is insolvent, to be receivers of and for a corporation in a proceeding by a shareholder in which it is established that:
(a) the directors are deadlocked in the management of the corporate affairs, the shareholders are unable to break the deadlock, and irreparable injury to the corporation is threatened or being suffered; or
(b) the directors or those in control of the corporation are acting fraudulently and irreparable injury to the corporation is threatened or being suffered.
(2) The court:
(a) may issue injunctions, appoint a temporary custodian or temporary receiver with all the powers and duties the court directs, take other action to preserve the corporate assets, wherever located, and carry on the business of the corporation until a full hearing is held;
(b) shall hold a full hearing, after notifying all parties to the proceeding and any interested persons designated by the court, before appointing a custodian or receiver; and
(c) has jurisdiction over the corporation and all of its property, wherever located.
(3) The court may appoint an individual, a domestic corporation, or a foreign corporation registered to do business in this state as a custodian or receiver and may require the custodian or receiver to post bond, with or without sureties, in an amount the court directs.
(4) The court shall describe the powers and duties of the custodian or receiver in its appointing order, which may be amended from time to time. Among other powers:
(a) a custodian may exercise all of the powers of the corporation, through or in place of its board of directors, to the extent necessary to manage the business and affairs of the corporation; and
(b) a receiver:
(i) may dispose of all or any part of the assets of the corporation, wherever located, at a public or private sale if authorized by the court; and
(ii) may sue and defend in the receiver's own name as receiver in all courts of this state.
(5) The court during a custodianship may redesignate the custodian a receiver, and during a receivership may redesignate the receiver a custodian, if doing so is in the best interests of the corporation.
(6) The court from time to time during the custodianship or receivership may order compensation to be paid and expense disbursements or reimbursements to be made to the custodian or receiver from the assets of the corporation or proceeds from the sale of its assets.
(7) In this section, "shareholder" means a record shareholder, a beneficial shareholder, and an unrestricted voting trust beneficial owner.
History: En. Sec. 91, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 8. Directors and Officers › 35-14-801. Board of directors -- requirements -- functions

35-14-801. Board of directors -- requirements -- functions.
(1) Except as may be provided in an agreement authorized under 35-14-732, each corporation must have a board of directors.
(2) Except as may be provided in an agreement authorized under 35-14-732 and subject to any limitation in the articles of incorporation permitted by 35-14-202(2), all corporate powers must be exercised by or under the authority of the board of directors, and the business and affairs of the corporation must be managed by or under the direction of and subject to the oversight of the board of directors.
History: En. Sec. 93, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 8. Directors and Officers › 35-14-802. Qualifications of directors

35-14-802. Qualifications of directors.
(1) The articles of incorporation or bylaws may prescribe qualifications for directors or for nominees for directors. Qualifications must be reasonable as applied to the corporation and must be lawful.
(2) A requirement that is based on a past, prospective, or current action or expression of opinion by a nominee or director that could limit the ability of a nominee or director to discharge the duties of a director is not a permissible qualification under this section. However, qualifications may include not being or having been subject to specified criminal, civil, or regulatory sanctions or not having been removed as a director by judicial action or for cause.
(3) A director need not be a resident of this state or a shareholder unless the articles of incorporation or bylaws prescribe those requirements.
(4) A qualification for nomination for director prescribed before a person's nomination applies to the person at the time of nomination. A qualification for nomination for director prescribed after a person's nomination does not apply to the person with respect to the nomination.
(5) A qualification for director prescribed before a director has been elected or appointed applies only at the time an individual becomes a director or during a director's term. A qualification prescribed after a director has been elected or appointed does not apply to that director before the end of that director's term.
History: En. Sec. 94, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 8. Directors and Officers › 35-14-803. Directors -- number -- election

35-14-803. Directors -- number -- election.
(1) A board of directors must consist of one or more individuals, with the number specified in or fixed in accordance with the articles of incorporation or bylaws.
(2) The number of directors may be increased or decreased from time to time by amendment to or in the manner provided in the articles of incorporation or bylaws.
(3) Directors are elected at the first annual shareholders' meeting and at each annual shareholders' meeting thereafter unless elected by written consent in lieu of an annual meeting as permitted by 35-14-704 or unless their terms are staggered under 35-14-806.
History: En. Sec. 95, Ch. 271, L. 2019.
2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 8. Directors and Officers › 35-14-804. Election of directors -- certain classes or series of shares

35-14-804. Election of directors -- certain classes or series of shares.
If the articles of incorporation or action by the board of directors pursuant to 35-14-602 authorizes dividing the shares into classes or series, the articles of incorporation may also authorize the election of all or a specified number of directors by the holders of one or more authorized classes or series of shares. A class or series or multiple classes or series of shares entitled to elect one or more directors constitute a separate voting group for purposes of the election of directors.
History: En. Sec. 96, Ch. 271, L. 2019.