Corporate Interested-Director Transaction Requirements in Nebraska

At a glance

Requirements one by one

Control and related persons extend beyond share ownership

Neb. Rev. Stat. § 21-2,120 defines control through majority board-election or removal power, or majority risk of loss or residual returns. Its related-person list includes specified family and household members, controlled entities, fiduciary and common-board relationships, and the director’s employer.

Qualification asks whether judgment could be impaired

Section 21-217 excludes a conflicted director and a director with a material relationship to that director. A familial, financial, professional, employment, or other relationship is material if it would reasonably be expected to impair objective judgment in the action. Prior nomination by a nonqualified director or shared service on another board does not automatically defeat qualification.

Confidentiality modifies disclosure only in specified circumstances

Section 21-2,122(b) applies only when the conflict arises solely through the specified fiduciary/entity or employer branch and the director reasonably believes full disclosure would violate law, an enforceable confidentiality obligation, or a professional ethics rule. The director must still provide nonprotected facts, the conflict’s nature, and the nondisclosure duty’s nature.

The voting and quorum calculations differ

Section 21-2,122 measures quorum against all qualified directors on the board or committee and approval against qualified directors who vote. Both require at least two. With five qualified directors, three supply quorum; if those three vote, two affirmative votes meet the special approval threshold.

Shareholder notice fixes the meeting electorate

Section 21-2,123(a) uses the notice record date to determine shareholders entitled to vote at a meeting. Before the vote, the conflicted director must send the vote counter a written count and identity of known nonqualified holdings. The holder definition expressly includes unrestricted voting-trust beneficial owners, alongside record and beneficial shareholders.

Fairness requires a whole-transaction inquiry

Sections 21-2,120(6) and 21-2,121(b)(3) require established fairness at the relevant time. The transaction must be beneficial as a whole, considering the director’s dealings and arm’s-length comparability for the consideration. The text does not name a party bearing a general fairness burden.

General board consent is completed by delivery

Under § 21-296, all directors must sign and deliver consents unless the articles or bylaws require a meeting. A signed revocation delivered before the complete unrevoked set arrives withdraws consent. The conflict procedure supplies no special abstaining-signature route that replaces these conditions.

Business opportunities have a separate officer-inclusive rule

Section 21-2,124 reaches directors and officers pursuing an opportunity, including indirectly through another person. It provides a precommitment informed disclaimer route and an alternative tied to a compliant articles- based limitation of the duty to offer opportunities. Its scope is broader than the director-only transaction-interest remedy provision.

The remedy protection states its ground and limits

Section 21-2,121 bars the specified equitable relief, damages, and sanctions against a director on the ground of the transaction interest in the stated shareholder or corporate proceedings. It separately addresses transactions outside the defined conflicting-interest category. Section 21-2,221 requires permanent shareholder, board, and committee-in-place action records and allows electronic or reasonably paper-convertible records.

What trips people up

Sections 21-2,122(d) and 21-2,123(f) require independent action if the conflict procedure does not meet another applicable authorization quorum or vote. Nonqualified directors or shares may participate in that independent action. Nonqualified-share presence or voting also does not spoil an otherwise compliant qualified-share action.

The share exclusion has an express employer-branch exception. Do not exclude every related person’s holdings indiscriminately.

Common questions

Can approval occur after the transaction?

Section 21-2,121(b)(1)-(2) permits qualifying director or shareholder action “at any time,” with the applicable disclosure and voting conditions.

Can a court give effect to a vote with a missing share report?

Section 21-2,123(e) permits discretion when reporting is the sole defect and the director establishes that the failure neither was intended to influence nor determined the outcome. It does not grant automatic protection.

Does skipping an opportunity disclaimer establish a breach?

Section 21-2,124(b) says failure to use the specified disclaimer process creates no implication that the opportunity should first have been offered to the corporation and does not alter the otherwise-applicable burden.

Statutes and sources

All official texts below were accessed September 4, 2026.

• Neb. Rev. Stat. § 21-2,120 — Official text: “21-2,120. Subpart definitions. (MBCA 8.60) In sections 21-2,120 to 21-2,123: (1) Director's conflicting interest transaction means a transaction effected or proposed to be effected by the corporation or by an entity controlled by the corporation: (i) To which, at the relevant time, the director is a party; (ii) Respecting which, at the relevant time, the director had knowledge and a material financial interest known to the director; or (iii) Respecting which, at the relevant time, the director knew that a related person was a party or had a material financial interest. (2) Control, including the term controlled by, means (i) having the power, directly or indirectly, to elect or remove a majority of the members of the board of directors or other governing body of an entity, whether through the ownership of voting shares or interests, by contract, or otherwise, or (ii) being subject to a majority of the risk of loss from the entity's activities or entitled to receive a majority of the entity's residual returns. (3) Relevant time means (i) the time at which directors' action respecting the transaction is taken in compliance with section 21-2,122, or (ii) if the transaction is not brought before the board of directors of the corporation, or its committee, for action under section 21-2,122, at the time the corporation, or an entity controlled by the corporation, becomes legally obligated to consummate the transaction. (4) Material financial interest means a financial interest in a transaction that would reasonably be expected to impair the objectivity of the director's judgment when participating in action on the authorization of the transaction. (5) Related person means: (i) The individual's spouse; (ii) A child, stepchild, grandchild, parent, stepparent, grandparent, sibling, stepsibling, half-sibling, aunt, uncle, niece, or nephew, or spouse of any thereof, of the individual or of the individual's spouse; (iii) A natural person living in the same home as the individual; (iv) An entity, other than the corporation or an entity controlled by the corporation, controlled by the individual or any person specified in subdivisions (5)(i) through (iii) of this section; (v) A domestic or foreign (A) business or nonprofit corporation, other than the corporation or an entity controlled by the corporation, of which the individual is a director, (B) unincorporated entity of which the individual is a general partner or a member of the governing body, or (C) individual, trust, or estate for whom or of which the individual is a trustee, guardian, personal representative, or like fiduciary; or (vi) A person that is, or an entity that is controlled by, an employer of the individual. (6) Fair to the corporation means, for purposes of subdivision (b)(3) of section 21-2,121, that the transaction as a whole was beneficial to the corporation, taking into appropriate account whether it was (i) fair in terms of the director's dealings with the corporation and (ii) comparable to what might have been obtainable in an arm's length transaction, given the consideration paid or received by the corporation. (7) Required disclosure means disclosure of (i) the existence and nature of the director's conflicting interest and (ii) all facts known to the director respecting the subject matter of the transaction that a director free of such conflicting interest would reasonably believe to be material in deciding whether to proceed with the transaction.”

• Neb. Rev. Stat. § 21-2,121 — Official text: “21-2,121. Judicial action. (MBCA 8.61) (a) A transaction effected or proposed to be effected by the corporation, or by an entity controlled by the corporation, may not be the subject of equitable relief, or give rise to an award of damages or other sanctions against a director of the corporation, in a proceeding by a shareholder or by or in the right of the corporation on the ground that the director has an interest respecting the transaction if it is not a director's conflicting interest transaction. (b) A director's conflicting interest transaction may not be the subject of equitable relief, or give rise to an award of damages or other sanctions against a director of the corporation, in a proceeding by a shareholder or by or in the right of the corporation on the ground that the director has an interest respecting the transaction if: (1) Directors' action respecting the transaction was taken in compliance with section 21-2,122 at any time; (2) Shareholders' action respecting the transaction was taken in compliance with section 21-2,123 at any time; or (3) The transaction, judged according to the circumstances at the relevant time, is established to have been fair to the corporation.”

• Neb. Rev. Stat. § 21-217 — Official text: “21-217. Qualified director. (MBCA 1.43) (a) A qualified director is a director who, at the time action is to be taken under: (1) Section 21-279, does not have (i) a material interest in the outcome of the proceeding or (ii) a material relationship with a person who has such an interest; (2) Section 21-2,113 or 21-2,115, (i) is not a party to the proceeding, (ii) is not a director as to whom a transaction is a director's conflicting interest transaction or who sought a disclaimer of the corporation's interest in a business opportunity under section 21-2,124, which transaction or disclaimer is challenged in the proceeding, and (iii) does not have a material relationship with a director described in either subdivision (a)(2)(i) or (ii) of this section; (3) Section 21-2,122, is not a director (i) as to whom the transaction is a director's conflicting interest transaction or (ii) who has a material relationship with another director as to whom the transaction is a director's conflicting interest transaction; (4) Section 21-2,124, would be a qualified director under subdivision (a)(3) of this section if the business opportunity were a director's conflicting interest transaction; or (5) Subdivision (b)(6) of section 21-220, is not a director (i) to whom the limitation or elimination of the duty of an officer to offer potential business opportunities to the corporation would apply or (ii) who has a material relationship with another officer to whom the limitation or elimination would apply. (b) For purposes of this section: (1) Material relationship means a familial, financial, professional, employment, or other relationship that would reasonably be expected to impair the objectivity of the director's judgment when participating in the action to be taken; and (2) Material interest means an actual or potential benefit or detriment, other than one which would devolve on the corporation or the shareholders generally, that would reasonably be expected to impair the objectivity of the director's judgment when participating in the action to be taken. (c) The presence of one or more of the following circumstances shall not automatically prevent a director from being a qualified director: (1) Nomination or election of the director to the current board by any director who is not a qualified director with respect to the matter or by any person that has a material relationship with that director, acting alone or participating with others; (2) Service as a director of another corporation of which a director who is not a qualified director with respect to the matter, or any individual who has a material relationship with that director, is or was also a director; or (3) With respect to action to be taken under section 21-279, status as a named defendant, as a director against whom action is demanded, or as a director who approved the conduct being challenged.”

• Neb. Rev. Stat. § 21-2,122 — Official text: “21-2,122. Directors' action.(MBCA 8.62) (a) Directors' action respecting a director's conflicting interest transaction is effective for purposes of subdivision (b)(1) of section 21-2,121 if the transaction has been authorized by the affirmative vote of a majority, but no fewer than two, of the qualified directors who voted on the transaction after required disclosure by the conflicted director of information not already known by such qualified directors or after modified disclosure in compliance with subsection (b) of this section if: (1) The qualified directors have deliberated and voted outside the presence of and without the participation by any other director; and (2) When the action has been taken by a committee, all members of the committee were qualified directors and either (i) the committee was composed of all the qualified directors on the board of directors or (ii) the members of the committee were appointed by the affirmative vote of a majority of the qualified directors on the board. (b) Notwithstanding subsection (a) of this section, when a transaction is a director's conflicting interest transaction only because a related person described in subdivision (5)(v) or (vi) of section 21-2,120 is a party to or has a material financial interest in the transaction, the conflicted director is not obligated to make required disclosure to the extent that the director reasonably believes that doing so would violate a duty imposed under law, a legally enforceable obligation of confidentiality, or a professional ethics rule if the conflicted director discloses to the qualified directors voting on the transaction: (1) All information required to be disclosed that is not so violative; (2) The existence and nature of the director's conflicting interest; and (3) The nature of the conflicted director's duty not to disclose the confidential information. (c) A majority, but no fewer than two, of all the qualified directors on the board of directors, or on the committee, constitutes a quorum for purposes of action that complies with this section. (d) Where directors' action under this section does not satisfy a quorum or voting requirement applicable to the authorization of the transaction by reason of the articles of incorporation, the bylaws, or a provision of law, independent action to satisfy those authorization requirements must be taken by the board of directors or a committee in which action directors who are not qualified directors may participate.”

• Neb. Rev. Stat. § 21-2,123 — Official text: “21-2,123. Shareholders' action.(MBCA 8.63) (a) Shareholders' action respecting a director's conflicting interest transaction is effective for purposes of subdivision (b)(2) of section 21-2,121 if a majority of the votes cast by the holders of all qualified shares are in favor of the transaction after (1) notice to shareholders describing the action to be taken respecting the transaction, (2) provision to the corporation of the information referred to in subsection (b) of this section, and (3) communication to the shareholders entitled to vote on the transaction of the information that is the subject of required disclosure to the extent the information is not known by them. In the case of shareholders' action at a meeting, the shareholders entitled to vote shall be determined as of the record date for notice of the meeting. (b) A director who has a conflicting interest respecting the transaction shall, before the shareholders' vote, inform the secretary or other officer or agent of the corporation authorized to count votes, in writing, of the number of shares that the director knows are not qualified shares under subsection (c) of this section and the identity of the holders of those shares. (c) For purposes of this section: (1) Holder means and held by refers to shares held by a record shareholder, a beneficial shareholder, and an unrestricted voting trust beneficial owner; and (2) qualified shares means all shares entitled to be voted with respect to the transaction except for shares that the secretary or other officer or agent of the corporation authorized to count votes either knows, or under subsection (b) of this section is notified, are held by (i) a director who has a conflicting interest respecting the transaction or (ii) a related person of the director, excluding a person described in subdivision (5)(vi) of section 21-2,120. (d) A majority of the votes entitled to be cast by the holders of all qualified shares constitutes a quorum for purposes of compliance with this section. Subject to subsection (e) of this section, shareholders' action that otherwise complies with this section is not affected by the presence of holders, or by the voting, of shares that are not qualified shares. (e) If a shareholders' vote does not comply with subsection (a) of this section solely because of a director's failure to comply with subsection (b) of this section and if the director establishes that the failure was not intended to influence and did not in fact determine the outcome of the vote, the court may take such action respecting the transaction and the director and may give such effect, if any, to the shareholders' vote as the court considers appropriate in the circumstances. (f) When shareholders' action under this section does not satisfy a quorum or voting requirement applicable to the authorization of the transaction by reason of the articles of incorporation or the bylaws or a provision of law, independent action to satisfy those authorization requirements must be taken by the shareholders in which action shares that are not qualified shares may participate.”

• Neb. Rev. Stat. § 21-2,124 — Official text: “21-2,124. Business opportunities.(MBCA 8.70) (a) If a director or officer pursues or takes advantage of a business opportunity, directly, or indirectly through or on behalf of another person, that action may not be the subject of equitable relief or give rise to an award of damages or other sanctions against the director, officer, or other person in a proceeding by or in the right of the corporation on the ground that the opportunity should have first been offered to the corporation if: (1) Before the director, officer, or other person becomes legally obligated respecting the opportunity, the director or officer brings it to the attention of the corporation and either: (i) Action by qualified directors disclaiming the corporation's interest in the opportunity is taken in compliance with the procedures set forth in section 21-2,122; or (ii) Shareholders' action disclaiming the corporation's interest in the opportunity is taken in compliance with the procedures set forth in section 21-2,123; in either case as if the decision being made concerned a director's conflicting interest transaction, except that, rather than making required disclosure as defined in section 21-2,120, the director or officer shall have made prior disclosure to those acting on behalf of the corporation of all material facts concerning the business opportunity known to the director or officer; or (2) The duty to offer the corporation the business opportunity has been limited or eliminated pursuant to a provision of the articles of incorporation adopted, and where required, made effective by action of qualified directors, in accordance with subdivision (b)(6) of section 21-220. (b) In any proceeding seeking equitable relief or other remedies based upon an alleged improper pursuit or taking advantage of a business opportunity by a director or officer, directly, or indirectly through or on behalf of another person, the fact that the director or officer did not employ the procedure described in subdivision (a)(1)(i) or (ii) of this section before pursuing or taking advantage of the opportunity shall not create an implication that the opportunity should have been first presented to the corporation or alter the burden of proof otherwise applicable to establish that the director or officer breached a duty to the corporation in the circumstances.”

• Neb. Rev. Stat. § 21-296 — Official text: “21-296. Action without meeting. (MBCA 8.21) (a) Except to the extent that the articles of incorporation or bylaws require that action by the board of directors be taken at a meeting, action required or permitted by the Nebraska Model Business Corporation Act to be taken by the board of directors may be taken without a meeting if each director signs a consent describing the action to be taken and delivers it to the corporation. (b) Action taken under this section is the act of the board of directors when one or more consents signed by all the directors are delivered to the corporation. The consent may specify the time at which the action taken thereunder is to be effective. A director's consent may be withdrawn by a revocation signed by the director and delivered to the corporation prior to delivery to the corporation of unrevoked written consents signed by all the directors. (c) A consent signed under this section has the effect of action taken at a meeting of the board of directors and may be described as such in any document.”

• Neb. Rev. Stat. § 21-2,221 — Official text: “21-2,221. Corporate records. (MBCA 16.01) (a) A corporation shall keep as permanent records minutes of all meetings of its shareholders and board of directors, a record of all actions taken by the shareholders or board of directors without a meeting, and a record of all actions taken by a committee of the board of directors in place of the board of directors on behalf of the corporation. (b) A corporation shall maintain appropriate accounting records. (c) A corporation or its agent shall maintain a record of its shareholders, in a form that permits preparation of a list of the names and addresses of all shareholders, in alphabetical order by class of shares showing the number and class of shares held by each. (d) A corporation shall maintain its records in the form of a document, including an electronic record or in another form capable of conversion into paper form within a reasonable time.”