All shareholders and owners of officially created entities have rights to information about the activities, financial condition, and records of that entity as set forth in the statutes of the state where the entity was formed. If the directors or officers of the corporation do not provide that information to you, or violate their duties, you can file a lawsuit.
If you or your company own an interest in another entity the statutes of the state where the entity was formed should protect your right to receive and request information about the company. Directors and officers also have several duties by statute in Nebraska and many other states. The Bylaws may also provide detail on duties of officers and directors, including how conflicts of interests should be handled. For example, directors and officers of a Nebraska corporation owe a duty to discharge their duties in good faith, with the care an ordinarily prudent person in a like position would exercise under similar circumstances; and in a manner he or she reasonably believes to be in the best interests of the corporation (Neb. Rev. Stat. § 21-1986 and 21-1992).
For Nebraska limited liability companies, a member of a member-managed limited liability company owes the company and the other members the duty of loyalty (Neb. Rev. Stat. § 21-138). This includes the duty to account to the company and to hold any property, profit, or benefit derived by the member as trustee. Members must refrain from dealing with the company in the conduct on behalf of a person having an interest adverse to the company; and refrain from competing with the company in the conduct of the company's activities.
The duty of care of a member of a member-managed Nebraska limited liability company is subject to the business judgment rule, but is generally to act with the care that a person in a like position would reasonably exercise under similar circumstances and in a manner the member reasonably believes to be in the best interests of the company. The managers and members must operate under the contractual obligation of good faith and fair dealing.
All of the members of a Nebraska limited liability company may authorize or ratify, after full disclosure of all material facts, a specific act or transaction that otherwise would violate the duty of loyalty (Neb. Rev. Stat. § 21-138)).
Angela Madathil is a Business, M&A, and Deal Attorney and provides legal assistance to shareholders, buyers and sellers of businesses, as well as business brokers in Nebraska, Missouri, and Kansas. This can involve submitting requests for information, responding to requests for information, filing a lawsuit regarding the oppression of minority shareholders or the violation of fiduciary duties. contract review and negotiation, due diligence assistance, and post-sale integration. The Goosmann Law Firm team advises to buyers and sellers of businesses, as well as business brokers throughout the Midwest and has attorneys licensed in Iowa, Kansas, Minnesota, Missouri, Nebraska, South Dakota, and other states.
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