§ 304 Director Removal For Misconduct

• •If a group of shareholders (owning at least 10% of the company) think a director is being dishonest, cheating, or really misusing their power, they can ask a court to remove that director.
• •The court can also stop that director from being re-elected for a certain time if they are removed.
• •The company itself must be involved in the court case.

Imagine a big toy company where some of the owners (shareholders) think one of the bosses (directors) is stealing money from the company.

If those owners own at least 10% of the company, they can go to court and ask to remove that boss. The court can also say that boss can’t be re-elected for a few years. The toy company has to be part of this court case.