A. A shareholder shall 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;
2. Became a shareholder through transfer by operation of law from one who was a shareholder at that time; or
3. Became a shareholder before public disclosure and without knowledge of the act or omission complained of; and
4. Fairly and adequately represents the interests of the corporation in enforcing the right of the corporation.
B. No shareholder may commence a derivative proceeding until:
1. A written demand has been made on the corporation to take suitable action; and
2. Ninety days have expired from the date delivery of the demand was made unless (i) the shareholder has been notified before the expiration of 90 days that the demand has been rejected by the corporation or (ii) irreparable injury to the corporation would result by waiting until the end of the 90-day period.
C. If the corporation commences a review and evaluation of the allegations made in the demand or complaint, the court may stay any derivative proceeding for such period as the court deems appropriate.
History
1992, c. 802; 2007, c. 165; 2010, c. 782.
