Corporate Director Removal and Board-Vacancy Requirements in Nevada

At a glance

Requirements one by one

Nevada's ordinary rules appear in NRS chapter 78. NRS 78.012 and 78.015 make Nevada law govern the domestic corporation's internal affairs while preserving separate Chapter 78A close-corporation and specially regulated branches.

Ordinary removal requires two-thirds of all outstanding voting power

NRS 78.335(1), (3) requires stockholders representing at least two-thirds of the voting power of all issued and outstanding stock entitled to vote. The section states no cause condition, and the articles may require more than two- thirds.

Unlike statutes that compare only votes cast at the meeting, Nevada uses all issued-and-outstanding voting power entitled to vote. NRS 78.320(2)-(3) permits stockholder action by written consent and carries a different meeting proportion into the consent threshold, unless the articles or bylaws provide otherwise. A removal consent therefore needs the § 78.335 proportion, not the general majority.

Cumulative and class seats have separate protections

Under NRS 78.335(2), articles-authorized cumulative voting protects a removal of fewer than all incumbent directors unless stockholders owning enough shares to prevent each director's election support removal. NRS 78.360 supplies the articles opt-in and advance-notice mechanics for cumulative voting.

If a class or series elects a director, § 78.335(4) applies the ordinary two- thirds proportion to that electorate unless the articles provide otherwise. NRS 78.330(2) allows classification by term or electorate but requires at least one-fourth of the directors to be elected annually.

A final regulatory directive creates a board-removal route

NRS 78.335(8) permits the other directors to remove a specified director when a court, governmental entity, or regulator with authority over the corporation finally requires cessation and provides no reasonable, practicable alternative needed to preserve a material license or similar authorization. The vote is a majority of the other directors' voting power, even below quorum, and must occur at a meeting rather than by consent.

The same statute also recognizes automatic cessation. Under § 78.335(7), if articles or bylaws tie a class or series election right to specified circumstances, termination of those circumstances can end the elected director's service without counting as removal under § 78.335.

Nevada states no general judicial-removal route for an ordinary director. NRS 78.345 instead lets holders of at least fifteen percent of voting power seek a court-ordered election after an eighteen-month failure to elect. NRS 78.347's deadlock custodianship and receivership systems are different remedies, not an ordinary removal vote.

Meeting and consent routes use different notice mechanics

NRS 78.370 requires written meeting notice, states the purpose for a special meeting, and sets delivery at ten to sixty days before the meeting. NRS 78.310(2) defaults meeting-call authority to the whole board, any two directors, or the president unless the articles or bylaws say otherwise.

Written consent under NRS 78.320 needs no meeting or notice. That shortcut does not extend to the regulatory board-removal route, which § 78.335(8) expressly makes meeting-only. Chapter 78 states no separate right for the targeted director to circulate a statement or receive a hearing.

The resignation rule is narrow

NRS 78.330(1) recognizes that a director's service can end by resignation, but Chapter 78 states no general resignation form, recipient, ordinary effective- time, acceptance, withdrawal, or irrevocability rule. NRS 78.335(6) addresses only a notice to the board that is effective at a future date.

That future vacancy may be filled before it occurs, with the appointment taking effect on the resignation date. The appointee serves the remainder of the resigning director's term.

Remaining directors are the default vacancy fillers

NRS 78.335(5) says all vacancies, including newly created seats, may be filled by a majority of the remaining directors even when they are fewer than a quorum, unless the articles provide otherwise. The section does not name stockholders, the class electorate, or another actor as a default ordinary filler.

If no directors remain, § 78.335 supplies no ordinary default filler; the articles or a separate judicial route may therefore matter. NRS 78.345's court-ordered election is available only after the stated eighteen-month failure condition, not simply whenever the last seat becomes vacant.

What trips people up

Two-thirds means two-thirds of all issued-and-outstanding voting power entitled to vote, not two-thirds of votes cast or two-thirds of a meeting quorum. The articles can raise that threshold further.

The vacancy rule is also board-centered. Nevada does not use the Model Act's usual three-way default of stockholders, board, or a below-quorum majority; NRS 78.335(5) names the remaining directors and lets the articles provide another route.

Common questions

Can Nevada stockholders remove a director by written consent?

Yes, unless the articles or bylaws restrict consent. NRS 78.320(2) permits an action that could be taken at a meeting to use written consent and carries over the action's required proportion, so the NRS 78.335 two-thirds threshold still applies.

Can directors remove another director?

Only through the narrow NRS 78.335(8) regulatory route described above. It requires a final, unavoidable directive tied to a material license or similar authorization and a meeting vote by a majority of the other directors' voting power.

Who fills an ordinary vacancy?

Unless the articles say otherwise, a majority of the remaining directors does, even if they are below quorum. Section 78.335 states no default stockholder filler.

Statutes and sources

• NRS 78.012, 78.015, 78.115, and 78.310. Govern internal-affairs scope, covered entities, board structure, and meeting callers.
• NRS 78.320, 78.330, and 78.335. Govern consent, director terms and classification, removal, automatic cessation, resignation vacancies, and vacancy filling.
• NRS 78.345 and 78.347. Govern court-ordered elections and separate custodianship/receivership boundaries.
• NRS 78.360 and 78.370. Govern cumulative-voting procedure and meeting notice.