Colorado § 7-108-105 - Terms of directors generally.

§ 7-108-105. Terms of directors generally.

(1) Except as provided in section 7-108-106, the terms of the initial directors of a corporation expire at the first shareholders' meeting at which directors are elected.

(2) Except as provided in section 7-108-106, the terms of all other directors expire at the next annual shareholders' meeting following their election.

(3) A decrease in the number of directors does not shorten an incumbent director's term.

(4) The term of a director elected to fill a vacancy pursuant to section 7-108-110 (1)(b) or 7-108-110 (1)(c) expires at the next annual shareholders' meeting at which directors are elected. The term of a director elected to fill a vacancy pursuant to section 7-108-110 (1)(a) shall be the unexpired term of the director's predecessor in office; except that, if the director's predecessor had been elected to fill a vacancy pursuant to section 7-108-110 (1)(b) or 7-108-110 (1)(c), the term of a director elected pursuant to section 7-108-110 (1)(a) shall be the unexpired term of the last predecessor elected by the shareholders.

(5) Despite the expiration of the director's term, a director continues to serve until the director's successor is elected and qualifies.

(6) (Deleted by amendment, L. 2004, p. 1497, § 252, effective July 1, 2004.)

Source: L. 93: Entire article added, p. 779, § 1, effective July 1, 1994. L. 2000: (6) amended, p. 978, § 55, effective July 1. L. 2002: (6) amended, p. 1848, § 110, effective July 1; (6) amended, p. 1712, § 110, effective October 1. L. 2004: (4), (5), and (6) amended, p. 1497, § 252, effective July 1.

ANNOTATION

Law reviews. For article, "Legislative Update", see 11 Colo. Law. 2142 (1982).

Annotator's note. Since § 7-108-105 is similar to § 7-5-102 as it existed prior to the 1993 recodification of the "Colorado Business Corporation Act", articles 101 to 117 of title 7, cases construing that provision and its predecessors have been included in the annotations to this section.

Directors named by incorporators are directors by operation of law. The persons who are named by the incorporators in the articles of incorporation as directors for the first year are created such directors by operation of law and not by election of the stockholders after the corporation is formed. Humphreys v. Mooney, 5 Colo. 282 (1880).

Otherwise selection of the directors of a corporation belongs to the stockholders. It is in a sense an individual right in them, as distinguished from a power of the corporation in its single aggregate capacity. Arkansas Valley Sugar Beet & Irrigated Land Co. v. Fort Lyon Canal Co., 173 F. 601 (8th Cir. 1909); People ex rel. Arkansas Valley Sugar Beet & Irrigated Land Co. v. Burke, 72 Colo. 486, 212 P. 837 (1923).

Their right to vote for directors is specifically prescribed by this section and does not proceed from any act, contract, or bylaw of the corporation. Arkansas Valley Sugar Beet & Irrigated Land Co. v. Fort Lyon Canal Co., 173 F. 601 (8th Cir. 1909).

However, denial of voting rights to one class of common stock in an election for directors of a corporation does not violate public policy. Hampton v. Tri-State Fin. Corp., 30 Colo. App. 420, 495 P.2d 566 (1972).

This section operates as a restriction upon the jurisdiction of a court to control corporate elections; a court has no jurisdiction, under the guise of either supervision or regulation, to direct the stockholders to proceed in electing directors in any other way than that which this section has provided. People ex rel. Arkansas Valley Sugar Beet & Irrigated Land Co. v. Burke, 72 Colo. 486, 212 P. 837 (1923).

And so stockholders who refuse to obey the provision of a decree rendered by a district court requiring them in nominating and voting for directors to observe the provisions of that decree, which is contrary to the way which this section provides, are not guilty of contempt. Arkansas Valley Sugar Beet & Irrigated Land Co. v. Lubers, 72 Colo. 513, 212 P. 848 (1923).