BUSINESS
CORPORATION CODE - CHAPTERS 9-13
Table of Contents [all chapters
of the Business Corporation Code]
CHAPTER 9 - MERGER OR CONSOLIDATION; GUARANTEE; DISPOSITION OF ASSETS
901. POWER OF MERGER OR CONSOLIDATION
(a) Two
or more domestic corporations may, as provided in this chapter:
(1) Merge
into a single corporation which shall be one of the constituent corporations;
or
(2) Consolidate
into a single corporation which shall be a new corporation to be formed
pursuant to the consolidation.
(b) Whenever
used in this chapter:
(1) "Merger"
means a procedure of the character described in subparagraph (a)(1).
(2) "Consolidation"
means an procedure of the character described in subparagraph (a)(2).
(3) "Constituent
corporation" means an existing corporation that is participating
in the merger or consolidation with one or more other corporations.
(4) "Surviving
corporation" means the constituent corporation into which one
or more other constituent corporations are merged.
(5) "Consolidated
corporation'' means the new corporation into which two or more constituent
corporations are consolidated.
902. PLAN OF MERGER OR CONSOLIDATION
(a) The
board of each corporation proposing to participate in a merger or consolidation
under section 901 (Power of merger or consolidation) shall adopt a plan
of merger or consolidation, setting forth:
(1) The
name of each constituent corporation and, if the name of any of them
has been changed, the name under which is was formed; and the name
of the surviving corporation, or the name, or the method of determining
it, of the consolidate corporation.
(2) As
to each constituent corporation, the designation and number of outstanding
shares of each class and series, specifying the classes and series
entitled to vote and further specifying each class and series, if
any, entitled to vote as a class; and, if the number of any such shares
is subject to change prior to the effective date of the merger or
consolidation, the manner in which such change may occur.
(3) The
terms and conditions of the proposed merger or consolidation, including
the manner and basis of converting the shares of each constituent
corporation into shares, bonds or other securities of the surviving
or consolidated corporation, or the cash or other consideration to
be paid or delivered in exchange for shares of each constituent corporation,
or a combination thereof
(4) In
case of merger, a statement of any amendments or changes in the certificate
of incorporation of the surviving corporation to be effected by such
merger; in case of consolidation, all statements required to be included
in a certificate of incorporation for a corporation formed under this
chapter, except statements as to facts not available at the time the
plan of consolidation is adopted by the board.
(5) Such
other provisions with respect to the proposed merger or consolidation
as the board considers necessary or desirable.
903. AUTHORIZATION BY SHAREHOLDERS
(a) The
board of each constituent corporation, upon adopting such plan of merger
or consolidation, shall submit such plan to a vote of shareholders in
accordance with the following:
(1) Notice
of meeting shall be given to each shareholder of record, as of the
record date fixed pursuant to section 604 (Fixing record date), whether
or not entitled to vote. A copy of the plan of merger or consolidation
or an outline of the material features of the plan shall accompany
such notice.
(2) The
plan of merger or consolidation shall be adopted at a meeting of shareholders
by vote of the holders of two-thirds of all outstanding shares entitled
to vote thereon. Notwithstanding any provision in the certificate
of incorporation, the holders of shares of a class or series shall
be entitled to vote and to vote as a class if the plan of merger or
consolidation contains any provision which, if contained in an amendment
to the certificate of incorporation, would entitle the holders of
shares of such class or series to vote and to vote as a class thereon.
In such case, in addition to the authorization of the merger or consolidation
by vote of the holders of two-thirds of all outstanding shares entitled
to vote thereon, the merger or consolidation shall be authorized by
vote of the holders of a majority of all outstanding shares of each
such class or series.
(b) Notwithstanding
shareholder authorization and at any time prior to the filing of the
certificate of merger or consolidation, the plan of merger or consolidation
may be abandoned pursuant to a provision for such abandonment, if any,
contained in the plan of merger or consolidation.
904. CERTIFICATE OF MERGER OR CONSOLIDATION; CONTENTS
(a) After
adoption of the plan of merger or consolidation by the board and shareholders
of each constituent corporation, unless the merger or consolidation
is abandoned in accordance with paragraph (b) of section 903 (Authorization
by shareholders), a certificate of merger or consolidation, entitled
"Certificate of merger (or consolidation) of .......... and ..........
into ....... (names of corporations) under section 904 of the Business
Corporation Code", shall be signed and verified on behalf of each
constituent corporation and delivered to the Nation Clerk. It shall
set forth:
(1) The
statements required by subparagraphs (a)(l), (2) and (4) of section
902 (Plan of merger or consolidation).
(2) The
effective date of the merger or consolidation if other than the date
of filing of the certificate of merger or consolidation by the Nation
Clerk.
(3) In
the case of consolidation, any statement required to be included in
a certificate of incorporation for a corporation formed under this
chapter but which was omitted under subparagraph (a)(4) of section
902.
(4) The
date when the certificate of incorporation of each constituent corporation
was filed by the Nation Clerk.
(5) The
manner in which the merger or consolidation was authorized with respect
to each constituent corporation.
905. MERGER OF PARENT AND SUBSIDIARY CORPORATION
(a) Any
domestic corporation owning at least ninety percent of the outstanding
shares of each class of another domestic corporation or corporations
may either merge such other corporation or corporations into itself
without the authorization of the shareholders of any such corporation
or merge itself and one or more of such other corporations into one
of such other corporations with the authorization of the parent corporation's
shareholders in accordance with paragraph (a) of section 903 (Authorization
by shareholders). In either case the board of such parent corporation
shall adopt a plan of merger, setting forth:
(1) The
name of each corporation to be merged and the name of the surviving
corporation, and if the name of any of them has been changed, the
name under which it was formed.
(2) The
designation and number of outstanding shares of each class of each
corporation to be merged and the number of such shares of each class,
if any, owned by the surviving corporation; and if the number of any
such shares is subject to change prior to the effective date of the
merger, the manner in which such change may occur.
(3) The
terms and conditions of the proposed merger, including the manner
and basis of converting the shares of each subsidiary corporation
to be merged not owned by the parent corporation into shares, bonds
or other securities of the surviving corporation, or the cash or other
consideration to be paid or delivered in exchange for shares of each
such subsidiary corporation, or a combination thereof
(4) If
the parent corporation is not the surviving corporation, provision
for the pro rata issuance of shares of the surviving corporation to
the shareholders of the parent corporation on surrender of any certificates
therefore.
(5) If
the parent corporation is not the surviving corporation, a statement
of any amendments or changes in the certificate of incorporation of
the surviving corporation to be effected by the merger.
(6) Such
other provisions with respect to the proposes merger as the board
considers necessary or desirable.
(b) If
the surviving corporation is the parent corporation, a copy of such
plan of merger or an outline of the material features thereof shall
be given, personally or by mail, to all holders of shares of each subsidiary
corporation to be merged not owned by the parent corporation, unless
the giving of such copy or outline has been waived by such holders.
(c) A certificate
of merger, entitled "Certificate of merger of .......... into ..........
(names of corporations) under section 905 of the Business Corporation
Code", shall be signed, verified and delivered to the Nation Clerk
by the surviving corporation. If the surviving corporation is the parent
corporation and such corporation does not own all shares of each subsidiary
corporation to be merged, such certificate shall be delivered not less
than thirty days after the giving of a copy or outline of the material
features of the plan of merger to shareholders of each such subsidiary
corporation, or at any time after the waiving thereof by the holders
of all of the outstanding shares of each such subsidiary corporation
not owned by the surviving corporation. The certificate shall set forth:
(1) The
statements required by subparagraphs (a)(1), (2), (4) and (5) of this
section.
(2) The
effective date of the merger if other than the date of filing of the
certificate of merger by the Nation Clerk.
(3) The
date when the certificate of incorporation of each constituent corporation
was filed by the Nation Clerk.
(4) A
statement that the plan of merger was adopted by the board of directors
of the parent corporation.
(5) If
the surviving corporation is the parent corporation and such corporation
does not own all the shares of each subsidiary corporation to be merged,
either the date of the giving to holders of shares of each subsidiary
corporation not owned by the surviving corporation of a copy of the
plan of merger or an outline of the material features thereof, or
a statement that the giving of such copy or outline has been waived,
if such is the case.
(6) If
the parent corporation is not the surviving corporation, a statement
that the proposed merger has been approved by the shareholders of
the parent corporation in accordance with paragraph (a) of section
903 (Authorization by shareholders).
(d) The
surviving corporation shall thereafter cause a copy of such certificate,
to be filed in the office of the Nation Clerk
(e) Paragraph
(b) of section 903 (Authorization by shareholders) shall apply to a
merger under this section.
(f) The
right of merger granted by this section to certain corporations shall
not preclude the exercise by such corporations of any other right of
merger or consolidation under this chapter.
906. EFFECT OF MERGER OR CONSOLIDATION
(a) Upon
the filing of the certificate of merger or consolidation by the Nation
Clerk or on such date subsequent thereto, not to exceed thirty days,
as shall be set forth in such certificate, the merger or consolidation
shall be effected.
(b) When
such merger or consolidation has been effected:
(1) Such
surviving or consolidated corporation shall thereafter, consistently
with its certificate of incorporation as altered or established by
the merger or consolidation, possess all the rights, privileges, immunities,
powers and purposes of each of the constituent corporations.
(2) All
the property, real and personal, including subscriptions to shares,
causes of action and every other asset of each of the constituent
corporations, shall vest in such surviving or consolidated corporation
without further act or deed.
(3) The
surviving or consolidated corporation shall assume and be liable for
all the liabilities, obligations and penalties of each of the constituent
corporations. No liability or obligation due or to become due, claim
or demand for any cause existing against any such corporation, or
any shareholder, officer or director thereof, shall be released or
impaired by such merger or consolidation. No action or proceeding,
whether civil or criminal, then pending by or against any such constituent
corporation, or any shareholder, officer or director thereof, shall
abate or be discontinued by such merger or consolidation, but may
be enforced, prosecuted, settled or compromised as if such merger
or consolidation had not occurred, or such surviving or consolidated,
corporation may be substituted in such action or special proceeding
in place of any constituent corporation.
(4) In
the case of a merger, the certificate of incorporation of the surviving
corporation shall be automatically amended to the extent, if any,
that changes in its certificate of incorporation are set forth in
the plan of merger; and, in the case of a consolidation, the statements
set forth in the certificate of consolidation and which are required
or permitted to be set forth in a certificate of incorporation of
a corporation formed under this chapter shall be its certificate of
incorporation.
907. MERGER OR CONSOLIDATION OF DOMESTIC AND FOREIGN CORPORATIONS
(a) One
or more foreign corporations and one or more domestic corporations may
be merged or consolidated into a corporation, if such merger or consolidation
is permitted by the laws of the jurisdiction under which each such foreign
corporation is incorporated. With respect to such merger or consolidation,
any reference in paragraph (b) of section 901 (Power of merger or consolidation)
to a corporation shall, unless the context otherwise requires, include
both domestic and foreign corporations.
(b) With
respect to procedure, including the requirement of shareholder authorization,
each domestic corporation shall comply with the provisions of this chapter
relating to merger or consolidation of domestic corporations, and each
foreign corporation shall comply with the applicable provisions of the
law of the jurisdiction under which it is incorporated.
(c) The
procedure for the merger of a subsidiary corporation or corporations
under section 905 (Merger of parent and subsidiary corporations) shall
be available where either a subsidiary corporation or the corporation
owning at least ninety percent of the outstanding shares of each class
of a subsidiary is a foreign corporation, and such merger is permitted
by the laws of the jurisdiction under which such foreign corporation
is incorporated.
(d) If
the surviving or consolidated corporation is, or is to be, a domestic
corporation, a certificate of merger or consolidation shall be signed,
verified and delivered to the Nation Clerk as provided in section 904
(Certificate of merger or consolidation; contents) or 905 (Merger of
parent and subsidiary corporations), as the case may be. In addition
to the matters specified in such sections, the certificate shall set
forth as to each constituent foreign corporation the jurisdiction and
date of its incorporation and the date when its application for authority
to do business within the territorial jurisdiction of the Nation was
filed by the Nation Clerk, and its fictitious name used in this Nation
pursuant to chapter thirteen of this chapter, if applicable, or, if
no such application has been filed, a statement to such effect.
(e) If
the surviving or consolidated corporation is, or is to be, formed under
the law of any jurisdiction other than the Nation:
(1) It
shall comply with the provisions of this chapter relating to foreign
corporations if it is to do business within the territorial jurisdiction
of the Nation.
(2) It
shall deliver to the Nation Clerk a certificate, entitled "Certificate
of merger (or consolidation) of .......... and .......... into ..........
(names of corporations) under section 907 of the Business Corporation
Code", which shall be signed and verified on behalf of each constituent
domestic and foreign corporation. It shall set forth:
(A)
If the procedure for the merger or consolidation of a constituent
domestic corporation was effected in compliance with sections 902
(Plan of merger or consolidation) and 903 (Authorization by shareholders),
the following:
(i)
The statements required by subparagraphs (a)(1) and (2) of section
902.
(ii)
The effective date of the merger or consolidation if other than
the date of filing of the certificate of merger or consolidation
by the Nation Clerk.
(iii)
The manner in which the merger or consolidation was authorized
with respect to each constituent domestic corporation and that
the merger or consolidation is permitted by the laws of the jurisdiction
of each constituent foreign corporation and is in compliance therewith.
(B)
If the procedure for the merger of a subsidiary corporation was
effected in compliance with section 905, the following:
(i)
The statements required by subparagraphs (a)(1), (2), (4) and
(5) of section 905.
(ii)
The effective date of the merger if other than the date of filing
of the certificate of merger by the Nation Clerk.
(iii)
If the surviving foreign corporation does not own all the shares
of a subsidiary domestic corporation being merged, either the
date of the giving to holders of shares of each subsidiary domestic
corporation not owned by the surviving foreign corporation of
a copy of the plan of merger or an outline of the material features
thereof, or a statement that the giving of such copy or outline
has been waived, if such is the case.
(iv)
That the merger is permitted by the laws of the jurisdiction of
each constituent foreign corporation and is in compliance therewith.
(v)
If the parent domestic corporation is not the surviving corporation,
a statement that the proposed merger has been approved by the
shareholders of the parent domestic corporation in accordance
with paragraph (a) of section 903 (Authorization by shareholders).
(C)
The jurisdiction and date of incorporation of the surviving or consolidated
foreign corporation, the date when its application for authority
to do business within the territorial jurisdiction of the Nation
was filed by the Nation Clerk, and its fictitious name used within
the territorial jurisdiction of the Nation pursuant to chapter thirteen
of this chapter, if applicable, or, if no such application has been
filed, a statement to such effect and that it is not to do business
within the territorial jurisdiction of the Nation until an application
for such authority shall have been filed by such department.
(D)
The date when the certificate of incorporation of each constituent
domestic corporation was filed by the Nation Clerk and the jurisdiction
and date of incorporation of each constituent foreign corporation,
other than the surviving or consolidated foreign corporation, and,
in the case of each such corporation authorized to do business within
the territorial jurisdiction of the Nation, the date when its application
for authority was filed by the secretary of state.
(E)
An agreement that the surviving or consolidated foreign corporation
may be served with process within the territorial jurisdiction of
the Nation in any action or special proceeding for the enforcement
of any liability or obligation of any domestic corporation or of
any foreign corporation, previously amenable to suit within the
territorial jurisdiction of the Nation, which is a constituent corporation
in such merger or consolidation, and for the enforcement, as provided
in this chapter, of the right of shareholders of any constituent
domestic corporation to receive payment for their shares against
the surviving or consolidated corporation.
(F)
An agreement that, subject to the provisions of section 623 (Procedure
to enforce shareholder's right to receive payment for shares), the
surviving or consolidated foreign corporation will promptly pay
to the shareholders of each constituent domestic corporation the
amount, if any, to which they shall be entitled under the provisions
of this chapter relating to the right of shareholders to receive
payment for their shares.
(G)
A designation of the Nation Clerk as its agent upon whom process
against it may be served in the manner set forth in paragraph (b)
of section 306 (Service of process), in any action or special proceeding,
and a post office address, to which the Nation Clerk shall mail
a copy of any process against it served upon him. Such post office
address shall supersede any prior address designated as the address
to which process shall be mailed.
(f) Upon
the filing of the certificate of merger or consolidation by the Nation
Clerk or on such date subsequent thereto, not to exceed ninety days,
as shall be set forth in such certificate, the merger or consolidation
shall be effected.
(g) The
surviving or consolidated domestic or foreign corporation shall thereafter
cause a copy of such certificate, to be filed in the office of the Nation
Clerk
(h) If
the surviving or consolidated corporation is, or is to be, formed under
the law of the Nation, the effect of such merger or consolidation shall
be the same as in the case of the merger or consolidation of domestic
corporations under section 906 (Effect of merger or consolidation).
If the surviving or consolidated corporation is, or is to be, incorporated
under the law of any jurisdiction other than the Nation, the effect
of such merger or consolidation shall be the same as in the case of
the merger or consolidation of domestic corporations, except in so far
as the law of such other jurisdiction provides otherwise.
908. GUARANTEE AUTHORIZED BY SHAREHOLDERS
A guarantee
may be given by a corporation, although not in furtherance of its corporate
purposes, when authorized at a meeting of shareholders by vote of the
holders of two-thirds of all outstanding shares entitled to vote thereon.
If authorized by a like vote, such guarantee may be secured by a mortgage
or pledge of, or the creation of a security interest in, all or any
part of the corporate property, or any interest therein, wherever situated.
909. SALE, LEASE, EXCHANGE OR OTHER DISPOSITION OF ASSETS
(a) A sale,
lease, exchange or other disposition of all or substantially all the
assets of a corporation, if not made in the usual or regular course
of the business actually conducted by such corporation, shall be authorized
only in accordance with the following procedure:
(1) The
board shall authorize the proposed sale, lease, exchange or other
disposition and direct its submission to a vote of shareholders.
(2) Notice
of meeting shall be given to each shareholder of record, whether or
not entitled to vote.
(3) The
shareholders shall approve such sale, lease, exchange or other disposition
and may fix, or may authorize the board to fix, any of the terms and
conditions thereof and the consideration to be received by the corporation
therefore, which may consist in whole or in part of cash or other
property, real or personal, including shares, bonds or other securities
of any other domestic or foreign corporation or corporations, by vote
at a meeting of shareholders of the holders of two-thirds of all outstanding
shares entitled to vote thereon.
(b) A recital
in a deed, lease or other instrument of conveyance executed by a corporation
to the effect that the property described therein does not constitute
all or substantially all of the assets of the corporation, or that the
disposition of the property affected by said instrument was made in
the usual or regular course of business of the corporation, or that
the shareholders have duly authorized such disposition, shall be presumptive
evidence of the fact so recited.
(c) An
action to set aside a deed, lease or other instrument of conveyance
executed by a corporation affecting real property or real and personal
property may not be maintained for failure to comply with the requirements
of paragraph (a) unless the action is commenced and a notice of pendency
of action is filed within one year after such conveyance, lease or other
instrument is recorded.
(d) Whenever
a transaction of the character described in paragraph (a) involves a
sale, lease, exchange or other disposition of all or substantially all
the assets of the corporation, including its name, to a new corporation
formed under the same name as the existing corporation, upon the expiration
of thirty days from the filing of the certificate of incorporation of
the new corporation, the existing corporation shall be automatically
dissolved, unless, before the end of such thirty-day period, such corporation
has changed its name. The adjustment and winding up of the affairs of
such dissolved corporation shall proceed in accordance with the provisions
of chapter 10 (Non-judicial dissolution).
(e) The
certificate of incorporation of a corporation formed under the authority
of paragraph (d) shall set forth the name of the existing corporation,
the date when its certificate of incorporation was filed by the Nation
Clerk, and that the shareholders of such corporation have authorized
the sale, lease, exchange or other disposition of all or substantially
all the assets of such corporation, including its name, to the new corporation
to be formed under the same name as the existing corporation.
(f) Notwithstanding
shareholder approval, the board may abandon the proposed sale, lease,
exchange or other disposition without further action by the shareholders,
subject to the rights, if any, of third parties under any contract relating
thereto.
910. RIGHT OF SHAREHOLDER TO RECEIVE PAYMENT FOR SHARES UPON MERGER
OR CONSOLIDATION, OR SALE, LEASE, EXCHANGE OR OTHER DISPOSITION OF ASSETS,
OR SHARE EXCHANGE
(a) A shareholder
of a domestic corporation shall, subject to and by complying with section
623 (Procedure to enforce shareholder's right to receive payment for
shares), have the right to receive payment of the fair value of his
shares and the other rights and benefits provided by such section, in
the following cases:
(1) Any
shareholder entitled to vote who does not assent to the taking of
an action specified in subparagraphs (A), (B) and (C).
(A)
Any plan of merger or consolidation to which the corporation is
a party; except that the right to receive payment of the fair value
of his shares shall not be available:
(i)
To a shareholder of the parent corporation in a merger authorized
by section 905 (Merger of parent and subsidiary corporations),
or paragraph (c) of section 907 (Merger or consolidation of domestic
and foreign corporations); and
(ii)
To a shareholder of the surviving corporation in a merger authorized
by this chapter, other than a merger specified in subparagraph
(i), unless such merger effects one or more of the changes specified
in subparagraph (b)(6) of section 806 (Provisions as to certain
proceedings) in the rights of the shares held by such shareholder.
(B)
Any sale, lease, exchange or other disposition of all or substantially
all of the assets of a corporation which requires shareholder approval
under section 909 (Sale, lease, exchange or other disposition of
assets) other than a transaction wholly for cash where the shareholders'
approval thereof is conditioned upon the dissolution of the corporation
and the distribution of substantially all of its net assets to the
shareholders in accordance with their respective interests within
one year after the date of such transaction.
(C)
Any share exchange authorized by section 913 in which the corporation
is participating as a subject corporation; except that the right
to receive payment of the fair value of his shares shall not be
available to a shareholder whose shares have not been acquired in
the exchange.
(2) Any
shareholder of the subsidiary corporation in a merger authorized by
section 905 or paragraph (c) of section 907, or in a share exchange
authorized by paragraph (9) of section 913, who files with the corporation
a written notice of election to dissent as provided in paragraph (c)
of section 623.
911. MORTGAGE OR PLEDGE OF, OR SECURITY INTEREST IN, CORPORATE PROPERTY
The board
may authorize any mortgage or pledge of, or the creation of a security
interest in, all or any part of the corporate property, or any interest
therein, wherever situated. Unless the certificate of incorporation
provides otherwise, no vote or consent of shareholders shall be required
to approve such action by the board.
912. REQUIREMENTS RELATING TO CERTAIN BUSINESS COMBINATIONS
(a) For
the purpose of this section:
(1) "Affiliate"
means a person that directly, or indirectly through one or more intermediaries,
controls, or is controlled by, or is under common control with, a
specified person.
(2) "Announcement
date", when used in reference to any business combination, means
the date of the first public announcement of the final, definitive
proposal for such business combination.
(3) "Associate",
when used to indicate a relationship with any person means (A) any
corporation or organization of which such person is an officer or
partner or is, directly or indirectly, the beneficial owner of ten
percent or more of any class of voting stock, (B) any trust or other
estate in which such person has a substantial beneficial interest
or as to which such person serves as trustee or in a similar fiduciary
capacity, and (C) any relative or spouse of such person, or any relative
of such spouse, who has the same home as such person.
(4) "Beneficial
owner", when used with respect to any stock, means a person:
(A)
that, individually or with or through any of its affiliates or associates,
beneficially owns such stock, directly or indirectly; or
(B)
that, individually or with or through any of its affiliates or associates,
has (i) the right to acquire such stock (whether such right is exercisable
immediately or only after the passage of time), pursuant to any
agreement, arrangement or understanding (whether or not in writing),
or upon the exercise of conversion rights, exchange rights, warrants
or options, or otherwise; provided, however, that a person shall
not be deemed the beneficial owner of stock tendered pursuant to
a tender or exchange offer made by such person or any of such person's
affiliates or associates until such tendered stock is accepted for
purchase or exchange; or (ii) the right to vote such stock pursuant
to any agreement, arrangement or understand (whether or not in writing);
provided, however, that a person shall not be deemed the beneficial
owner of any stock under this item if the agreement, arrangement
or understanding vote such stock (X) arises solely from a revocable
proxy in accordance with the applicable rules an regulations under
the United States Exchange Act and (Y) is not then reportable on
Schedule 13D under the United States Exchange Act (or any comparable
or successor report); or
(C)
that has any agreement, arrangement or understanding (whether or
not in writing), for the purpose of acquiring, holding, voting (except
voting pursuant to a revocable proxy or consent as described in
item (ii) of clause (B) of the subparagraph), or disposing of such
stock with any other person that beneficially owns, or whose affiliates
or associates beneficially own, directly or indirectly, such stock.
(5) "Business
combination", when used in reference to any resident domestic
corporation and any interested shareholder of such resident domestic
corporation, means:
(A)
any merger or consolidation of such resident domestic corporation
or any subsidiary of such resident domestic corporation with (i)
such interested shareholder or (ii) any other corporation (whether
or not itself an interested shareholder of such resident domestic
corporation) which is, or after such merger or consolidation would
be, an affiliate or associate of such interested shareholder;
(B)
any sale, lease, exchange, mortgage, pledge, transfer or other disposition
(in one transaction or a series of transactions) to or with such
interested shareholder or any affiliate or associate of such interested
shareholder of assets of such resident domestic corporation or any
subsidiary of such resident domestic corporation (i) having an aggregate
market value equal to ten percent or more of the aggregate market
value of all the assets, determined on a consolidated basis, of
such resident domestic corporation, (ii) having an aggregate market
value equal to ten percent or more of the aggregate market value
of all the outstanding stock of such resident domestic corporation,
or (iii) representing ten percent or more of the earning power or
net income, determined on a consolidated basis, of such resident
domestic corporation;
(C)
the issuance or transfer by such resident domestic corporation or
any subsidiary of such resident domestic corporation (in one transaction
or a series of transactions) of any stock of such resident domestic
corporation or any subsidiary of such resident domestic corporation
which has an aggregate market value equal to five percent or more
of the aggregate market value of all the outstanding stock of such
resident domestic corporation to such interested shareholder or
any affiliate or associate of such interested shareholder except
pursuant to the exercise of warrants or rights to purchase stock
offered, or a dividend or distribution paid or made, pro rata to
all shareholders of such resident domestic corporation;
(D)
the adoption of any plan or proposal for the liquidation or dissolution
of such resident domestic corporation proposed by, or pursuant to
any agreement, arrangement or understanding (whether or not in writing)
with, such interested shareholder or any affiliate or associate
of such interested shareholder;
(E)
any reclassification of securities (including, without limitation,
any stock split, stock dividend, or other distribution of stock
in respect of stock, or any reverse stock split), or recapitalization
of such resident domestic corporation, or any merger or consolidation
of such resident domestic corporation with any subsidiary of such
resident domestic corporation, or any other transaction (whether
or not with or into or otherwise involving such interested shareholder),
proposed by, or pursuant to any agreement, arrangement or understanding
(whether or not in writing) with, such interested shareholder or
any affiliate or associate of such interested shareholder, which
has the effect, directly or indirectly, of increasing the proportionate
share of the outstanding shares of any class or series of voting
stock or securities convertible into voting stock of such resident
domestic corporation or any subsidiary of such resident domestic
corporation which is directly or indirectly owned by such interested
shareholder or any affiliate or associate of such interested shareholder,
except as a result of immaterial changes due to fractional share
adjustments; or
(F)
any receipt by such interested shareholder or any affiliate or associate
of such interested shareholder of the benefit, directly or indirectly
(except proportionately as a shareholder of such resident domestic
corporation) of any loans, advances, guarantees, pledges or other
financial assistance or any tax credits or other tax advantages
provided by or through such resident domestic corporation.
(6) "Common
stock'' means any stock other than preferred stock.
(7) "Consummation
date", with respect to any business combination, means the date
of consummation of such business combination, or, in the case of a
business combination as to which a shareholder vote is taken, the
later of the business day prior to the vote or twenty days prior to
the date of consummation of such business combination.
(8) "Control",
including the terms"controlling", "controlled by"
and "under common control with", means the possession, directly
or indirectly, of the power to direct or cause the direction of the
management and policies of a person, whether through the ownership
of voting stock, by contract, or otherwise. A person's beneficial
ownership of ten percent or more of a corporation's outstanding voting
stock shall create a presumption that such person has control of such
corporation. Notwithstanding the foregoing, a person shall not be
deemed to have control of a corporation if such person holds voting
stock, in good faith and not for the purpose of circumventing this
section, as an agent, bank, broker, nominee, custodian or trustee
for one or more beneficial owners who do not individually or as a
group have control of such corporation.
(9) "Exchange
Act" means the United States law known as the Securities Exchange
Act of 1934, as the same has been or hereafter may be amended from
time to time.
(10)
"Interested shareholder", when used in reference to any
resident domestic corporation, means any person (other than such resident
domestic corporation or any subsidiary of such resident domestic corporation)
that
(A)
(i)
is the beneficial owner, directly or indirectly, of twenty percent
or more of the outstanding voting stock of such resident domestic
corporation; or
(ii)
is an affiliate or associate of such resident domestic corporation
and at any time within the five-year period immediately prior
to the date in question was the beneficial owner, directly or
indirectly, of twenty percent or more of the then outstanding
voting stock of such resident domestic corporation; provided that
(B)
for the purpose of determining whether a person is an interested
shareholder, the number of shares of voting stock of such resident
domestic corporation deemed to be outstanding shall include shares
deemed to be beneficially owned by the person through application
of subparagraph four of the paragraph but shall not include any
other unissued shares of voting stock of such resident domestic
corporation which may be issuable pursuant to any agreement, arrangement
or understanding, or upon exercise of conversion rights, warrants
or options, or otherwise.
(11)
"Market value", when used in reference to stock or property
of any resident domestic corporation, means:
(A)
in the case of stock, the highest closing sale price during the
thirty-day period immediately preceding the date in question of
a share of such stock on the composite tape for New York stock exchange-listed
stocks, or, if such stock is not quoted on such composite tape or
if such stock is not listed on such exchange, on the principal United
States securities exchange registered under the Exchange Act on
which such stock is listed, or, if such stock is not listed on any
such exchange, the highest closing bid quotation with respect to
a share of such stock during the thirty-day period preceding the
date in question on the National Association of Securities Dealers,
Inc. Automated Quotations System or any system then in use, or if
no such quotations are available, the fair market value on the date
in question of a share of such stock as determined by the board
of directors of such resident domestic corporation in good faith;
and
(B)
in the case of property other than cash or stock, the fair market
value of such property on the date in question as determined by
the board of directors of such resident domestic corporation in
good faith.
(12)
"Preferred stock" means any class or series of stock of
a resident domestic corporation which under the by-laws or certificate
of incorporation of such resident domestic corporation is entitled
to receive payment of dividends prior to any payment of dividends
on some other class or series of stock, or is entitled in the event
of any voluntary liquidation, dissolution or winding up of the resident
domestic corporation to receive payment or distribution of a preferential
amount before any payments or distributions are received by some other
class or series of stock.
(13)
"Resident domestic corporation" means an issuer of voting
stock which:
(A)
is organized under the laws of the Nation;
(B)
either (i) has its principal executive offices and significant business
operations located within the territorial jurisdiction of the Nation;
and
(C)
has at least ten percent of its voting stock owned beneficially
by persons residing within the territorial jurisdiction of the Nation.
For purposes of this section, the residence of a partnership, unincorporated
association, trust or similar organization shall be the principal
office of such organization.
No resident
domestic Corporation, which is organized under the laws of the Nation,
shall cease to be a resident domestic corporation by reason of events
occurring or actions taken while such resident domestic corporation
is subject to the provisions of this section.
(14)
"Stock" means:
(A)
any stock or similar security, any certificate of interest, any
participation in any profit sharing agreement, any voting trust
certificate, or any certificate of deposit for stock; and
(B)
any security convertible, with or without consideration, into stock,
or any warrant, call or other option or privilege of buying stock
without being bound to do so, or any other security carrying any
right to acquire, subscribe to or purchase stock.
(15)
"Stock acquisition date", with respect to any person and
any resident domestic corporation, means the date that such person
first becomes an interested shareholder of such resident domestic
corporation.
(16)
"Subsidiary" of any person means any other corporation of
which a majority of the voting stock is owned, directly or indirectly,
by such person.
(17)
"Voting stock" means shares of capital stock of a corporation
entitled to vote generally in the election of directors.
(b) Notwithstanding
anything to the contrary contained in the chapter (except the provisions
of paragraph (d) of this section), no resident domestic corporation
shall engage in any business combination with any interested shareholder
of such resident domestic corporation for a period of five years following
such interested shareholder's stock acquisition date unless such business
combination or the purchase of stock made by such interested shareholder
on such interested shareholder's stock acquisition date is approved
by the board of directors of such resident domestic corporation prior
to such interested shareholder's stock acquisition date. If a good faith
proposal is made in writing to the board of directors of such resident
domestic corporation regarding a business combination, the board of
directors shall respond, in writing, within thirty days or such shorter
period, if any, as may be required by the United States Exchange Act,
setting forth its reasons for its decision regarding such proposal.
If a good faith proposal to purchase stock is made in writing to the
board of directors of such resident domestic Corporation, the board
of directors, unless it responds affirmatively in writing thirty days
or such shorter period, if any, as may be required by the United States
Exchange Act, shall be deemed to have disapproved such stock purchase.
(c) Notwithstanding
anything to the contrary contained in the chapter (except the provisions
of paragraphs (b) and (d) of this section), no resident domestic corporation
shall engage at any time in any business combination with any interested
shareholder of such resident domestic corporation other than a business
combination specified in any one of subparagraph (l), (2) or (3):
(1) A
business combination approved by the board of directors of such resident
domestic corporation prior to such interested shareholder's stock
acquisition date, or where the purchase of stock made by such interested
shareholder on such interested shareholder's stock acquisition date
had been approved by the board of directors of such resident domestic
corporation prior to such interested shareholder's stock acquisition
date.
(2) A
business combination approved by the affirmative vote of the holders
of a majority of the outstanding voting stock not beneficially owned
by such interested shareholder or any affiliate or associate of such
interested shareholder at a meeting called for such purpose no earlier
than five years after such interested shareholder's stock acquisition
date.
(3) A
business combination that meets all of the following conditions:
(A)
The aggregate amount of the cash and the market value as of the
consummation date of consideration other than cash to be received
per share by holders of outstanding shares of common stock of such
resident domestic corporation in such business combination is at
least equal to the higher of the following:
(i)
the highest per share price paid by such interested shareholder
at a time when he was the beneficial owner, directly or indirectly,
of five percent or more of the outstanding voting stock of such
resident domestic corporation, for any shares of common stock
of the same class or series acquired by it (X) within the five-year
period immediately prior to the announcement date with respect
to such business combination, or (Y) within the five-year period
immediately prior to, or in, the transaction in which such interested
shareholder became an interested shareholder, whichever is higher;
plus, in either case, interest compounded annually from the earlier
date on which such highest per share acquisition price was paid
through the consummation date at the rate for one-year United
States treasury obligations from time to time in effect; less
the aggregate amount of any cash dividends paid, and the market
value of any dividends paid other than in cash, per share of common
stock since such earliest date, up to the amount of such interest;
and
(ii)
the market value per share of common stock on the announcement
date with respect to such business combination or on such interested
shareholder’s stock acquisition date, whichever is higher;
plus interest compounded annually from such date through the consummation
date at the rate for one-year United states treasury obligations
from time to time in effect; less the aggregate amount of any
cash dividends paid, and the market value of any dividends paid
other than in cash, per share of common stock since such date,
up to the amount of such interest.
(B)
The aggregate amount of the cash and the market value as of the
consummation date of consideration other than cash to be received
per share by holders of outstanding shares of any class or series
of stock, other than common stock, of such resident domestic corporation
is at least equal to the highest of the following (whether or not
such interested shareholder has previously acquired any shares of
such class or series of stock):
(i)
the highest per share price paid by such interested shareholder
at a time when he was the beneficial owner, directly or indirectly,
of five percent or more of the outstanding voting stock of such
resident domestic corporation, for any shares of such class or
series of stock acquired by it (X) within the five-year period
immediately prior to the announcement date with respect to such
business combination, or (Y) within the five-year period immediately
prior to, or in, the transaction in which such interested shareholder
became an interested shareholder, whichever is higher; plus, in
either case, interest compounded annually from the earliest date
on which such highest per share acquisition price was paid through
the consummation date at the rate for one-year United States treasury
obligations from time to time in effect; less the aggregate amount
of any cash dividends paid, and the market value of any dividends
paid other than in cash, per share of such class or series of
stock since such earliest date, up to the amount of such interest;
(ii)
the highest preferential amount per share to which the holders
of shares of such class or series of stock are entitled in the
event of any voluntary liquidation, dissolution or winding up
of such resident domestic corporation, plus the aggregate amount
of any dividends declared or due as to which such holders are
entitled prior to payment of dividends on some other class or
series of stock (unless the aggregate amount of such dividends
is included in such preferential amount); and
(iii)
the market value per share of such class or series of stock on
the announcement date with respect to such business combination
or on such interested shareholder's stock acquisition date, whichever
is higher; plus interest compounded annually from such date through
the consummation date at the rate for one-year United States treasury
obligations from time to time in effect; less the aggregate amount
of any cash dividends paid, and the market value of any dividends
paid other than in cash, per share of such class or series of
stock since such date, up to the amount of such interest.
(C)
The consideration to be received by holders of a particular class
or series of outstanding stock (including common stock) of such
resident domestic corporation in such business combination is in
cash or in the same form as the interested shareholder has used
to acquire the largest number of shares of such class of series
of stock previously acquired by it, and such consideration shall
be distributed promptly.
(D)
The holders of all outstanding shares of stock of such resident
domestic corporation not beneficially owned by such interested shareholder
immediately prior to the consummation of such business combination
are entitled to receive in such business combination cash or other
consideration for such shares in compliance with clauses (A), (B)
and (C) of this subparagraph.
(E)
After such interested shareholder's stock acquisition date and prior
to the consummation date with respect to such business combination,
such interested shareholder has not become the beneficial owner
of any additional shares of voting stock of such resident domestic
corporation except:
(i)
as part of the transaction which resulted in such interested shareholder
becoming an interested shareholder;
(ii)
by virtue of proportionate stock splits, stock dividends or other
distributions of stock in respect of stock not constituting a
business combination under clause (E) of subparagraph five of
paragraph (a) of this section;
(iii)
through a business combination meeting all of the conditions of
paragraph (b) of this section and this paragraph; or
(iv)
through purchase by such interested shareholder at any price which,
if such price had been paid in an otherwise permissible business
combination the announcement date and consummation date of which
were the date of such purchase, would have satisfied the requirements
of clauses (A), (B) and (C) of this subparagraph.
(d) The
provisions of this section shall not apply:
(1) to
any business combination of a resident domestic corporation that does
not have a class of voting stock registered with the United States
Securities and Exchange Commission pursuant to section twelve of the
United States Exchange Act, unless the certificate of incorporation
provides otherwise; or
(2) to
any business combination of a resident domestic corporation whose
certificate of incorporation has been amended to provided that such
resident domestic corporation shall be subject to the provisions of
this section, which did not have a class of voting stock registered
with the United States Securities and Exchange Commission pursuant
to section twelve of the United States Exchange Act on the effective
date of such amendment, and which is a business combination with an
interested shareholder whose stock acquisition date is prior to the
effective date of such amendment; or
(3) to
any business combination of a resident domestic corporation (i) the
original certificate of incorporation of which contains a provision
expressly electing not to be governed by this section, or (ii) which
adopts an amendment to such resident domestic corporation's by-laws,
approved by the affirmative vote of the holders, other than interested
shareholders and their affiliates and associates, of a majority of
the outstanding voting stock of such resident domestic corporation,
excluding the voting stock of interested shareholders and their affiliates
and associates, expressly electing not to be governed by this section,
provided that such amendment to the by-laws shall not be effective
until eighteen months after such vote of such resident domestic corporation's
shareholders and shall not apply to any business combination of such
resident domestic corporation with an interested shareholder whose
stock acquisition date is on or prior to the effective date of such
amendment; or
(4) to
any business combination of a resident domestic corporation with an
interested shareholder of such resident domestic corporation which
became an interested shareholder inadvertently, if such interested
shareholder (i) as soon as practicable, divests itself of a sufficient
amount of the voting stock of such resident domestic corporation so
that it no longer is the beneficial owner, directly or indirectly,
of twenty percent or more of the outstanding voting stock of such
resident domestic corporation, an (ii) would not at any time within
the five-year period preceding the announcement date with respect
to such business combination have been an interested shareholder but
for such inadvertent acquisition.
913. SHARE EXCHANGES
(a)
(1) Two
domestic corporations may, as provided in this section, participate
in the consummation of a plan for binding share exchanges.
(2)Whenever
used in this chapter:
(A)
"Acquiring corporation" means a corporation that is participating
in a procedure pursuant to which such corporation is acquiring all
of the outstanding shares of one or more classes of a subject corporation.
(B)
"Subject corporation'' means a corporation that is participating
in a procedure pursuant to which all of the outstanding shares of
one or more classes of such corporation are being acquired by an
acquiring corporation.
(b) The
board of the acquiring corporation and the board of the subject corporation
shall adopt a plan of exchange, setting forth:
(1) The
name of the acquiring corporation and the name of the subject corporation,
and, if the name of either of them has been changed, the name under
which it was formed;
(2) As
to the acquiring corporation and the subject corporation, the designation
and number of outstanding shares of each class and series, specifying
the classes and series entitled to vote and further specifying each
class and series, if any, entitled to vote as a class; and, if the
number of any such shares is subject to change prior to the effective
date of the exchange, the manner in which such change may occur;
(3) The
terms and conditions of the proposed exchange, including the manner
and basis of exchanging the shares to be acquired for shares, bonds
or other securities of the acquiring corporation, or the cash or other
consideration to be paid or delivered in exchange for such shares
to be acquired, or a combination thereof; and
(4) Such
other provisions with respect to the proposed exchange as the board
considers necessary or desirable.
(c) The
board of the subject corporation, upon adopting the plan of exchange,
shall submit such plan, except as provided in paragraph (g) of this
section, to a vote of shareholders in accordance with the following:
(1) Notice
of meeting shall be given to each shareholder of record, as of the
record date fixed pursuant to section 604 (Fixing record date), whether
or not entitled to vote. A copy of the plan of exchange or an outline
of the material features of the plan shall accompany such notice.
(2) The
plan of exchange shall be adopted at a meeting of shareholders by
vote of the holders of two-thirds of all outstanding shares entitled
to vote thereon. Notwithstanding any provision in the certificate
of incorporation, the holders of shares of a class or series shall
be entitled to vote and to vote as a class if the plan of exchange
contains any provision which, if contained in an amendment to the
certificate of incorporation, would entitle the holders of shares
of such class or series to vote as a class thereon, or if the shares
of such class or series are to be exchanged pursuant to the plan of
exchange. In such case, in addition to the authorization of the exchange
by vote of the holders of two-thirds of all outstanding shares entitled
to vote thereon, the exchange shall be authorized by vote of the holders
of a majority of all outstanding shares of each such class or series.
Notwithstanding shareholder authorization and at any time prior to
the filing of the certificate of exchange, the plan of exchange may
be abandoned pursuant to a provision for such abandonment, if any,
contained in the plan of exchange.
(d) After
adoption of the plan of exchange by the board of the acquiring corporation
and the board of the subject corporation and by the shareholders of
the subject corporation entitled to vote thereon, unless the exchange
is abandoned in accordance with paragraph (c), a certificate of exchange,
entitled "Certificate of exchange of shares of ..........., subject
corporation, for shares of ......., acquiring corporation, or other
consideration, under section 913 of the Business Corporation Code",
shall be signed and verified on behalf of each corporation and delivered
to the Nation Clerk. It shall set forth:
(1) the
statements required by subparagraphs (1) and (2) of paragraph (b)
of this section;
(2) the
effective date of the exchange if other than the date of filing of
the certificate of exchange by the Nation Clerk;
(3) the
date when the certificate of incorporation of each corporation was
filed by the Nation Clerk;
(4) the
designation of the shares to be acquired by the acquiring corporation
and a statement of the consideration for such shares; and
(5) the
manner in which the exchange was authorized with respect to each corporation.
(e) Upon
the filing of the certificate of exchange by the Nation Clerk or on
such date subsequent thereto, not to exceed thirty days, as shall be
set forth in such certificate, the exchange shall be effected. When
such exchange has been effected, ownership of the shares to be acquired
pursuant to the plan of exchange shall vest in the acquiring corporation,
whether or not the certificates for such shares have been surrendered
for exchange, and the acquiring corporation shall be entitled to have
new certificates registered in its name or at its direction. Shareholders
whose shares have been so acquired shall become entitled to the shares,
bonds or other securities of the acquiring corporation, or the cash
or other consideration, required to be paid or delivered in exchange
for such shares pursuant to the plan. Subject to any terms of the plan
regarding surrender of certificates thereto evidencing the shares so
acquired and regarding whether such certificates shall thereafter evidence
securities of the acquiring corporation, such certificates shall thereafter
evidence only the right to receive the consideration required to be
paid or delivered in exchange for such shares pursuant to the plan,
or, in the case of dissenting shareholders, their rights under section
910 (Right of shareholder to receive payment for shares upon merger
or consolidation, or sale, lease, exchange or other disposition of assets,
or share exchange) and section 623 (Procedure to enforce shareholder's
right to receive payment for shares).
(f)
(1) a
foreign corporation and a domestic corporation may participate in
a share exchange, but, if the subject corporation is a foreign corporation,
only if such exchange is permitted by the laws of the jurisdiction
under which such foreign corporation is incorporated. With respect
to such exchange, any reference in subparagraph (2) of paragraph (a)
of this section to a corporation shall, unless the context otherwise
requires, include both domestic and foreign corporations, and the
provisions of paragraphs (b), (c), (d) and (e) of this section shall
apply, except to the extent otherwise provided in this paragraph.
(2) With
respect to procedure, including the requirement of shareholder authorization,
a domestic corporation shall comply with the provisions of this chapter
relating to share exchanges in which domestic corporations are participating,
and a foreign corporation shall comply with the applicable provisions
of the law of the jurisdiction under which it is incorporated.
(3) If
the subject corporation is a foreign corporation, the certificate
of exchange shall set forth, in addition to the matters specified
in paragraph (d), the jurisdiction and date of incorporation of such
corporation and a statement that the exchange is permitted by the
laws of the jurisdiction of such corporation and is in compliance
therewith.
(g)
(1) Any
corporation owning at least ninety percent of the outstanding common
shares, having full voting rights, of another corporation may acquire
by exchange the remainder of such outstanding common shares, without
the authorization of the shareholders of any such corporation and
with the effect provided for in paragraph (e) of this section. The
board of the acquiring corporation shall adopt a plan of exchange,
setting forth the matters specified in paragraph (b) of this section.
A copy of such plan of exchange or an outline of the material features
thereof shall be given, personally or by mail, to all holders of shares
of the subject corporation that are not owned by the acquiring corporation,
unless the giving of such copy or outline has been waived by such
holders.
(2) A
certificate of exchange, entitled "Certificate of exchange of
shares of ....., subject corporation, for shares of ....., acquiring
corporation, or other consideration, under paragraph (g) of section
913 of the Business Corporation Code" and complying with the
provisions of paragraph (d) and, if applicable, subparagraph (3) of
paragraph (f) shall be signed, verified and delivered to the Nation
Clerk by the acquiring corporation, but not less than thirty days
after the giving of a copy or outline of the material features of
the plan of exchange to shareholders of the subject corporation, or
at any time after the waiving thereof by the holders of all the outstanding
shares of the subject corporation not owned by the acquiring corporation.
(3) The
right of exchange of shares granted by this paragraph to certain corporations
shall not preclude the exercise by such corporations of any other
right of exchange under this chapter.
(4) The
procedure for the exchange of shares of a subject corporation under
this paragraph (g) of this section shall be available where either
the subject corporation or the acquiring corporation is a foreign
corporation, and, in case the subject corporation is a foreign corporation,
where such exchange is permitted by the laws of the jurisdiction under
which such foreign corporation is incorporated.
(h) This
section does not limit the power of a domestic or foreign corporation
to acquire all or part of the shares of one or more classes of another
domestic or foreign corporation by means of a voluntary exchange or
otherwise.
(i)
(1) A
binding share exchange pursuant to this section shall constitute a
"business combination'' pursuant to section nine hundred twelve
of this chapter (Requirements relating to certain business combinations)
if the subject corporation is a "resident domestic corporation''
and the acquiring corporation is an "interested shareholder"
of the subject corporation, as such terms are defined in section nine
hundred twelve of this chapter.
(2) With
respect to convertible securities and other securities evidencing
a right to acquire shares of a subject corporation, a binding share
exchange pursuant to this section shall have the same effect on the
rights of the holders of such securities as a merger of the subject
corporation.
CHAPTER 10 - NON-JUDICIAL DISSOLUTION
1001. AUTHORIZATION OF DISSOLUTION
A corporation
may be dissolved under this chapter. Such dissolution shall be authorized
at a meeting of shareholders by the vote of the holders of two-thirds
of all outstanding shares entitled to vote thereon, except as otherwise
provided under section 1002 (Dissolution under provision in certificate
of incorporation).
1002. DISSOLUTION UNDER PROVISION IN CERTIFICATE OF INCORPORATION
(a) The
certificate of incorporation may contain a provision that any shareholder,
or the holders of any specified number or proportion of shares, or of
any specified number or proportion of shares of any class or series
thereof, may require the dissolution of the corporation at will or upon
the occurrence of a specified event. If the certificate of incorporation
contains such a provision, a certificate of dissolution under section
1003 (Certificate of dissolution; contents) may be signed, verified
and delivered to the Nation Clerk as provided in section 104 (Certificate;
requirements, signing, filing, effectiveness) when authorized by a holder
or holders of the number or proportion of shares specified in such provision,
given in such manner as may be specified therein, or if no manner is
specified therein, when authorized on written consent signed by such
holder or holders; or such certificate may be signed, verified and delivered
to the Nation Clerk by such holder or holders or by such of them as
are designated by them.
(b) An
amendment of the certificate of incorporation which adds a provision
permitted by this section, or which changes or strikes out such a provision,
shall be authorized at a meeting of shareholders by vote of all outstanding
shares, whether or not otherwise entitled to vote on any amendment,
or of such lesser proportion of shares and of such class or series of
shares, but not less than a majority of all outstanding shares entitled
to vote on any amendment, as may be provided specifically in the certificate
of incorporation for adding, changing or striking out a provision permitted
by this section.
(c) If
the certificate of incorporation of any corporation contains a provision
authorized by this section, the existence of such provision shall be
noted conspicuously on the face or back of every certificate for shares
issued by such corporation.
1003. CERTIFICATE OF DISSOLUTION; CONTENTS
(a) A certificate
of dissolution, entitled "Certificate of dissolution of .... (name
of corporation) under section 1003 of the Business Corporation Code",
shall be signed, verified and delivered to the Nation Clerk. It shall
set forth:
(1) The
name of the corporation and, if its name has been changed, the name
under which it was formed.
(2) The
date its certificate of incorporation was filed by the Nation Clerk.
(3) The
name and address of each of its officers and directors.
(4) That
the corporation elects to dissolve.
(5) The
manner in which the dissolution was authorized.
1004. CERTIFICATE OF DISSOLUTION; FILING
The Nation
Clerk shall not file such certificate unless all Nation taxes have been
paid. Upon payment of all Nation taxes, or a statement from the Chief
Financial Officer of the Nation that no taxes are due, the certificate
shall be filed.
1005. PROCEDURE AFTER DISSOLUTION
(a) After
dissolution:
(1) The
corporation shall carry on no business except for the purpose of winding
up its affairs.
(2) The
corporation shall proceed to wind up its affairs, with power to fulfill
or discharge its contracts, collect its assets, sell its assets for
cash at public or private sale, discharge or pay its assets for cash
at public or private sale, discharge or pay its liabilities, and do
all other acts appropriate to liquidate its business.
(3) After
payment or adequately providing for the payment of its liabilities:
(A)
The corporation, if authorized at a meeting of shareholders by a
vote of the holders of a majority of all outstanding shares entitled
to vote thereon may sell its remaining assets, or any part thereof,
for cash, shares, bonds or other securities or partly for cash and
partly for shares, bonds or other securities, and distribute the
same among the shareholders according to their respective rights.
In the case of a sale under this subparagraph where the consideration
is in whole or in part other than cash, any shareholder, entitled
to vote thereon, who does not vote for or consent in writing to
such sale, thereon, who does not vote for or consent in writing
to such sale, shall, subject to and by complying with the provisions
of section 623 (Procedure to enforce shareholder’s right to
receive payment for shares), have the right to receive payment for
his shares. Section 909 (Sale, lease, exchange or other disposition
of assets) is not applicable to a sale of assets under this paragraph.
(B)
The corporation, whether or not it has made a sale under subparagraph
(A), may distribute any remaining assets, in cash or in kind or
partly each, among its shareholders according to their respective
rights.
(b) When
there are no shareholders, upon dissolution all subscriptions for shares
shall be canceled and all obligations of the corporation to issue shares
or of the subscribers to pay their subscriptions shall terminate, except
for such payments as may be required to enable the corporation to pay
its liabilities.
(c) Upon
the winding up of the affairs of the corporation, any assets distributable
to a creditor or shareholder who is unknown or cannot be found, or who
is under disability and for whom there is no legal representative, shall
be paid to the Nation as payment of the final liquidating distribution,
and be subject to the provisions of the abandoned property law.
1006. CORPORATE ACTION AND SURVIVAL OF REMEDIES AFTER DISSOLUTION
(a) A dissolved
corporation, its directors, officers and shareholders may continue to
function for the purpose of winding up the affairs of the corporation
in the same manner as if the dissolution had not taken place, except
as otherwise provided in this chapter or by court order. In particular,
and without limiting the generality of the foregoing:
(1) The
directors of a dissolved corporation shall not be deemed to be trustees
of its assets; title to such assets shall not vest in them, but shall
remain in the corporation until transferred by it in its corporate
name.
(2) Dissolution
shall not change quorum or voting requirements for the board of shareholders,
or provisions regarding election, appointment, resignation or removal
of, or filling vacancies among, directors or officers, of provisions
regarding amendment or repeal of by-laws or adoption of new by-laws.
(3) Shares
may be transferred and determinations of shareholders for any purpose
may be made without closing the record of shareholders until such
time, if any, as such record may be closed, and either the board or
the shareholders may close it.
(4) The
corporation may sue or be sued in all courts and participate in actions
and proceedings, whether judicial, administrative, arbitrative or
otherwise, in its corporate name, and process may be served by or
upon it.
(b) The
dissolution of a corporation shall not affect any remedy available to
or against such corporation, its directors, officers or shareholders
for any right or claim existing or any liability incurred before such
dissolution, except as provided in sections 1007 (Notice to creditors;
filing or barring claims) or 1008 (Jurisdiction of Nation court to supervise
dissolution and liquidation).
1007. NOTICE TO CREDITORS; FILING OR BARRING CLAIMS
(a) At
any time after dissolution, the corporation may give a notice requiring
all creditors and claimants, including any with unliquidated or contingent
claims and any with whom the corporation has unfulfilled contracts,
to present their claims in writing and in detail at a specified place
and by a specified day, The giving of such notice shall not constitute
a recognition that any person is a proper creditor or claimant, and
shall not revive or make valid, or operate as a recognition of the validity
of, or a waiver of any defense or counterclaim in respect of any claim
against the corporation, its assets, directors, officers or shareholders,
which has been barred by any statute of limitations or become invalid
by any cause, or in respect of which the corporation, its directors,
officers or shareholders, has any defense or counterclaim.
(b) Any
claims which shall have been filed as provided in such notice and which
shall be disputed by the corporation may be submitted for determination
to the Nation court. A claim filed by the trustee or paying agent for
the holders of bonds or coupons shall have the same effect as if filed
by the holder of any such bond or coupon. Any person whose claim is,
barred by any statute of limitations is not a creditor or claimant entitled
to any notice under this section or section 1008. The claim of any such
person and all other claims which are not timely filed as provided in
such notice except claims which are the subject of litigation, and all
claims which are so filed but are disallowed by the court under section
1008, shall be forever barred as against the corporation, its assets,
directors, officers and shareholders, except to such extent, if any,
as the court may allow them against any remaining assets of the corporation
in the case of a creditor who shows satisfactory reason for his failure
to file his claim as so provided.
(c) Notwithstanding
this section and section 1008 tax claims and other claims of the Nation,
another Indian Nation, any state and of the United States shall not
be required to be filed under those sections, and such claims shall
not be barred because not so filed, and distribution of the assets of
the corporation, or any part thereof, may be deferred until determination
of any such claims.
(d) Laborer's
wages shall be preferred claims and entitled to payment before any other
creditors out of the assets of the corporation in excess of valid prior
liens or encumbrances.
1008. JURISDICTION OF ONEIDA NATION COURT TO SUPERVISE DISSOLUTION
AND LIQUIDATION
(a) At
any time after the filing of a certificate of dissolution under this
chapter the Nation court, in a special proceeding instituted under this
section, upon the petition of the corporation, or, in a situation approved
by the court, upon the petition of a creditor, claimant, director, officer,
shareholder, subscriber for shares, incorporator or the Nation Prosecutor,
may suspend or annul the dissolution or continue the liquidation of
the corporation under the supervision of the court and may make all
such order as it may deem proper in all matters in connection with the
dissolution or the winding Lip of the affairs of the corporation, and
in particular, and without limitation of the generality thereof, in
respect of the following:
(1) The
determination of the validity of the authorization of the dissolution
of the corporation and of the execution and delivery of the certificate
of dissolution under this chapter.
(2) The
adequacy of the notice given to creditors and claimants and if it
is determined to have been inadequate, the requirement of such further
notice as the court may deem proper .
(3) The
determination of the validity and amount or invalidity of any claims
which have been presented to the corporation.
(4) The
barring of all creditors and claimants who have not timely filed claims
as provided in any such notice, or whose claims have been disallowed
by the court, as against the corporation, its assets, directors, officers
and shareholders.
(5) The
determination and enforcement of the liability of any director, officer,
shareholder or subscriber for shares, to the corporation or for the
liabilities of the corporation.
(6) The
payment, satisfaction or compromise of claims against the corporation,
the retention of assets for such purpose, and the determination of
the adequacy of provisions made for payment of the liabilities of
the corporation.
(7) The
disposition or destruction of records, documents and papers of the
corporation.
(8) The
appointment and removal of a receiver under chapter 12 (Receivership)
who may be a director, officer or shareholder of the corporation.
(9) The
issuance of injunctions for one or more of the purposes and as provided
in section 1115 (Injunction).
(10)
The return of subscription payments to subscribers for shares, and
the making of distributions, in cash or in kind or partly each, to
the shareholders.
(11)
The payment to the Oneida Indian Nation, as abandoned property, of
assets under paragraph (c) of section 1005 (Procedure after dissolution).
(b) Orders
under this section may be entered ex parte, except that if such special
proceeding was not instituted upon petition of the corporation, notice
shall be given to the corporation in such manner as the court may direct.
Notice shall be given to such other persons interested, and in such
manner, as the court may deem proper, of any hearings and of the entry
of any orders on such matters as the court shall deem proper. All orders
made by the court under this section shall be binding upon the Nation,
the corporation, its officers, directors, shareholders, subscribers
for shares, incorporators, creditors and claimants.
(c)
(1) Simultaneously
with the institution of such special proceeding for annulment of the
dissolution, the petitioner shall apply to the Nation Clerk to reserve
the corporation name to the corporation. If such name shall not be
available for use, the petitioner forthwith upon being notified thereof
shall apply to such department for the reservation of another and
available name and any judgment or order of annulment made in such
proceeding shall order and direct the petitioner to execute a certificate
of change of the corporate name to such other name.
(2) The
clerk of the court, shall transmit a certified copy of the judgment
or order of annulment of the dissolution, together with the certificate
of change of corporate name in the appropriate case, to the Nation
Clerk. Upon filing by the Nation Clerk, the annulment of dissolution
shall be effected.
1009. APPLICABILITY TO DISSOLUTION UNDER OTHER PROVISIONS
The provisions
of sections 1005 (Procedure after dissolution), 1006 (Corporate action
and survival of remedies after dissolution), 1007 (Notice to creditors;
filing or barring claims) and 1008 (Jurisdiction of Nation court to
supervise dissolution and liquidation) shall apply to a corporation
dissolved by expiration of its period of duration.
CHAPTER 11 - JUDICIAL DISSOLUTION
1101. NATION PROSECUTOR'S ACTION FOR JUDICIAL DISSOLUTION
(a) The
Nation Prosecutor may bring an action for the dissolution of a corporation
upon one or more of the following grounds:
(1) That
the corporation procured its formation through fraudulent misrepresentation
or concealment of a material fact.
(2) That
the corporation has exceeded the authority conferred upon it by law,
or has violated any provision of law whereby it has forfeited its
charter, or carried on, conducted or transacted its business in a
persistently fraudulent or illegal manner, or by the abuse of its
powers contrary to the public policy of the state has become liable
to be dissolved.
(b) The
enumeration in paragraph (a) of grounds for dissolution shall not exclude
actions or special proceedings by the Nation Prosecutor for the annulment
or dissolution of a corporation for other causes as provided in this
chapter or in any other Nation statute.
1102. DIRECTORS' PETITION FOR JUDICIAL DISSOLUTION
If a majority
of the board adopts a resolution that finds that the assets of a corporation
are not sufficient to discharge its liabilities or that a dissolution
will be beneficial to the shareholders, it may present a petition to
the Nation Court for its dissolution.
1103. SHAREHOLDERS' PETITION FOR JUDICIAL DISSOLUTION
(a) If
the shareholders of a corporation adopt a resolution stating that they
find that its assets are not sufficient to discharge its liabilities,
or that they deem a dissolution to be beneficial to the shareholders,
the shareholders or such of them as are designated for that purpose
in such resolution may present a petition to the Nation Court for its
dissolution.
(b) A shareholders'
meeting to consider such a resolution may be called, notwithstanding
any provision in the certificate of incorporation, by the holders of
ten percent of all outstanding shares entitled to vote thereon, or if
the certificate of incorporation authorizes a lesser proportion of shares
to call the meeting, by such lesser proportion. A meeting under this
paragraph may not be called more often than once in any period of twelve
consecutive months.
(c) Such
a resolution may be adopted at a meeting of shareholders by vote of
the holders of a majority of all outstanding shares entitled to vote
thereon or if the certificate of incorporation requires a greater proportion
of votes to adopt such a resolution, by such a greater proportion.
1104. PETITION IN CASE OF DEADLOCK AMOUNT DIRECTORS OR SHAREHOLDERS
(a) Except
as otherwise provided in the certificate of incorporation under section
613 (Limitations on right to vote), the holders of one-half of all outstanding
shares of a corporation entitled to vote in an election of directors
may present a petition for dissolution on one or more of the following
grounds:
(1) That
the directors are so divided respecting the management of the corporation's
affairs that the votes required for action by the board cannot be
obtained,
(2) That
the shareholders are so divided that the votes required for the election
of directors cannot be obtained.
(3) That
there is internal dissension and two or more factions of shareholders
are so divided that dissolution would be beneficial to the shareholders.
(b) If
the certificate of incorporation provided that the proportion of votes
required for action by the board, or the proportion of votes of shareholders
required for election of directors, shall be greater than that otherwise
required by this chapter, such a petition may be presented by the holders
of more than one-third of all outstanding shares entitled to vote on
non-judicial dissolution under section 1001 (Authorization of dissolution).
(c) Notwithstanding
any provision in the certificate of incorporation, any holder of shares
entitled to vote at an election of directors of a corporation, may present
a petition for its dissolution on the ground that the shareholders are
so divided that they have failed, for a period which includes at least
two consecutive annual meeting dates, to elect successors to directors
whose terms have expired or would have expired upon the election and
qualification of their successors.
1104-A. PETITION FOR JUDICIAL DISSOLUTION UNDER SPECIAL CIRCUMSTANCES
(a) The
holders of twenty percent or more of all outstanding shares of a corporation,
other than a corporation registered as an investment company under the
United States law "Investment Company Act of 1940", no shares
of which are listed on a national securities exchange or regularly quoted
in an over-the-counter market by one or more members of a national or
an affiliated securities association, who are entitled to vote in an
election of directors may present a petition of dissolution on one or
more of the following grounds:
(1) The
directors or those in control of the corporation have been guilty
of illegal, fraudulent or oppressive actions toward the complaining
shareholders;
(2) The
property or assets of the corporation are being looted, wasted, or
diverted for non-corporate purposes by its directors, officers or
those in control of the corporation.
(b) The
court, in determining whether to proceed with involuntary dissolution
pursuant to this section, shall take into account:
(1) Whether
liquidation of the corporation is the only feasible means whereby
the petitioners may reasonably expect to obtain a fair return on their
investment; and
(2) Whether
liquidation of the corporation is reasonably necessary for the protection
of the rights and interests of any substantial number of shareholders
or of the petitioners.
(c) In
addition to all other disclosure requirements, the directors or those
in control of the Corporation, no later than thirty days after the filing
of a petition hereunder, shall make available for inspection and copying
to the petitioners under reasonable working conditions the corporate
financial books and records for the three preceding years.
(d) The
court may order stock valuations be adjusted and may provide for a surcharge
upon the directors or those in control of the corporation upon a finding
of willful or reckless dissipation or transfer of assets or corporate
property without just or adequate compensation therefore.
1105. CONTENTS OF PETITION FOR JUDICIAL, DISSOLUTION
A petition
for dissolution shall specify the section or sections of this chapter
under which it is authorized and state the reasons why the corporation
should be dissolved. It shall be verified by the petitioner or by one
of the petitioners.
1106. ORDER TO SHOW CAUSE; ISSUANCE; PUBLICATION, SERVICE, FILING
(a) Upon
the presentation of such a petition, the court shall make an order requiring
the corporation and all persons interested in the corporation to show
cause before it, or before a referee designated in the order, at a time
and place therein specified, not less than four weeks after the granting
of the order, why the corporation should not be dissolved. In connection
therewith, the court may order the corporation, its officers and directors,
to furnish the court with a schedule of all information, known or ascertainable
with due diligence by them, deemed pertinent by the court, including
a statement of the corporate assets and liabilities, and the name and
address of each shareholder and of each creditor and claimant, including
any with unliquidated or contingent claims and any with whom the corporation
has unfulfilled contracts.
(b) A copy
of the order to show cause and the petition shall be filed, within ten
days after the order is entered, with the Nation Clerk. A copy of each
schedule furnished to the court under this section shall, within ten
days thereafter, be filed with the Nation Clerk.
1107. AMENDING PAPERS
At any
stage, before final order, the court may grant an order amending the
petition or ally other paper filed in the action or special proceeding,
with like effect as though originally filed as amended, or otherwise
as the court may direct.
1108. REFEREE
If a referee
was not designated in the order to show cause, the court, in its discretion,
may appoint a referee when or after the order is returnable. The court
may at any time appoint a successor referee.
1109. HEARING AND DECISION
At the
time and place specified in the order to show cause, or at any other
time and place to which the hearing is adjourned, the court or the referee
shall hear the allegations and proofs of the parties and determine the
facts. The decision of the court or the report of the referee shall
be made and filed with the clerk of the court with all convenient speed.
1110. APPLICATION FOR FINAL, ORDER
When the
hearing is before a referee, a motion for a final order must be made
to the court upon notice to each party to the action or special proceeding
who has appeared therein. The notice of motion may be served as prescribed
for the service of papers upon an attorney in an action in such court.
When the hearing is before the court, a motion for a final order may
be made at the hearing or at such time and upon such notice as the court
prescribes.
1111. JUDGMENT OR FINAL ORDER OF DISSOLUTION
(a) In
an action or special proceeding under this chapter if, in the court's
discretion, it shall appear that the corporation should be dissolved,
it shall make a judgment or final order dissolving the corporation.
(b) In
making its decision, the court shall take into consideration the following
criteria:
(1) In
an action brought by the Nation Prosecutor, the interest of the public
is of paramount importance.
(2) In
a special proceeding brought by directors or shareholders, the benefit
to the shareholders of a dissolution is of paramount importance.
(3) In
a special proceeding brought under section 1104 (Petition in case
of deadlock among directors or shareholders) or section 1104-a (Petition
for judicial dissolution under special circumstances) dissolution
is not to be denied merely because it is found that the corporate
business has been or could be conducted at a profit.
(c) If
the judgment or final order shall provide for a dissolution of the corporation,
the court may, in its discretion, provide therein for the distribution
of the property of the corporation to those entitled thereto according
to their respective rights.
(d) The
clerk of the court or such other person as the court may direct shall
transmit certified copies of the judgment or final order of dissolution
to the Nation Clerk. Upon filing by the Nation Clerk, the corporation
shall be dissolved.
(e) The
corporation shall promptly thereafter transmit a certified copy of the
judgment or final order to the Nation Clerk.
1112. PRESERVATION OF ASSETS; APPOINTMENT OF RECEIVER
At any
stage of an action or special proceeding under this chapter, the court
may, in its discretion, make all such orders as it may deem proper in
connection with preserving the property and carrying on the business
of the corporation, including the appointment and removal of a receiver
under chapter 12 (Receivership), who may be a director, officer or shareholder
of the corporation.
1113. CERTAIN SALES, TRANSFER, SECURITY INTERESTS AND JUDGMENTS VOID
A sale,
mortgage, conveyance or other transfer of, or the creation of a security
interest in, any property of a corporation made, without prior approval
of the court, after service upon the corporation of a summons in an
action, or of an order to show cause in a special proceeding, under
this chapter in payment of or as security for an existing or prior debt
or for any other or for no consideration, or a judgment thereafter rendered
against the corporation by confession or upon the acceptance of any
offer, shall be void as against such persons and to such extent, if
any, as the court shall determine.
1114. INJUNCTION
(a) At
any stage of an action or special proceeding under this chapter, the
court may, in its discretion, grant an injunction, effective during
the pendency of the action or special proceeding or such shorter period
as it may specify in the injunction, for one or more of the following
purposes:
(1) Restraining
the corporation and its directors and officers from transacting any
unauthorized business and from exercising any corporate powers, except
by permission of the court.
(2) Restraining
the corporation and its directors and officers from collecting or
receiving any debt or other property of the corporation, and from
paying out or otherwise transferring or delivering any property of
the corporation, except by permission of the court.
(3) Restraining
the creditors of the corporation from beginning any action against
the corporation, or from taking any proceedings in an action theretofore
commenced, except by permission of the court. Such injunction shall
have the same effect and be subject to the same provisions of law
as if each creditor upon whom it is served was named therein.
1115. DISCONTINUANCE OF ACTION OR SPECIAL PROCEEDING
An action
or special proceeding for the dissolution of a corporation may be discontinued
at any stage when it is established that the cause for dissolution did
not exist or no longer exists. In such event, the court shall dismiss
the action or special proceeding and direct any receiver to redeliver
the corporation all its remaining property.
1116. APPLICABILITY OF OTHER PROVISIONS
(a) Subject
to the provisions of this article, the provisions of sections 1005 (Procedure
after dissolution), 1006 (Corporate action and survival of remedies
after dissolution), 1007 (Notice to creditors; filing or barring claims)
and 1008 (Jurisdiction of Oneida Indian Nation court to supervise dissolution
and liquidation) shall apply to a corporation dissolved under this article.
(b) Any
orders provided for in section 1008, may be made at any stage of an
action or special proceeding for dissolution of a corporation under
this article, and if the corporation is dissolved under this article,
the court may retain jurisdiction for the purpose of making such orders,
after the dissolution, in such action or special proceeding. The court
may also make such orders in separate special proceedings, as provided
in section 1008.
(c) Notice
to creditors and claimants, provided for in section 1007, may also be
given, by order of the court, at any stage of an action or special proceeding
for dissolution of a corporation under this article.
1117. PURCHASE OF PETITIONER'S SHARES; VALUATION
(a) In
any proceeding brought pursuant to section eleven hundred four-a of
this chapter, any other shareholder or shareholders or the corporation
may, at any time within ninety days after the filing of such petition
or at such later time as the court in its discretion may allow, elect
to purchase the shares owned by the petitioners at their fair value
and upon such terms and conditions as may be approved by the court,
including the conditions of paragraph (c) herein. An election pursuant
to this section shall be irrevocable unless the court, in its discretion,
for just and equitable consideration determines that such election be
revocable.
(b) If
one or more shareholders or the corporation elect to purchase the shares
owned by the petitioner but are unable to agree with the petitioner
upon the fair value of such shares, the court, upon the application
of such prospective purchaser or purchasers, or the petitioner, may
stay the proceedings brought pursuant to section 1104-a of this chapter
and determine the fair value of the petitioner's shares as of the day
prior to the date on which such petition was filed, exclusive of my
element of value arising from such filing but giving effect to any adjustment
or surcharge found to be appropriate in the proceeding under section
1104-a of this chapter. In determining the fair value of the petitioner's
shares, the court, in its discretion, may award interest from the date
the petition is filed to the date of payment for the petitioner's share
at an equitable rate upon judicially determined fair value of his shares.
(c) In
connection with any election to purchase pursuant to this section:
(1) If
such election is made beyond ninety days after the filing of the petition,
the court allows such petition, the court, in its discretion, may
award the petitioner his reasonable expenses incurred in the proceeding
prior to such election, including reasonable attorneys' fees;
(2) The
court, in its discretion, may require, at any time prior to the actual
purchase of petitioners shares, the posting of a bond or other acceptable
security in an amount sufficient to secure petitioners for the fair
value of his shares.
CHAPTER 12 - RECEIVERSHIP
1201. ACTION BY JUDGMENT CREDITOR FOR SEQUESTRATION
Where final
judgment for a sum of money has been rendered against a corporation,
and an execution issued has been returned wholly or partly unsatisfied,
the judgment creditor may maintain an action to procure a judgment sequestrating
the property of the corporation and providing for a distribution thereof.
1202. APPOINTMENT OF RECEIVER OF PROPERTY OF A DOMESTIC OR FOREIGN
CORPORATION
(a) A receiver
of the property of a corporation can be appointed only by the court,
and in one of the following cases:
(1) An
action or special proceeding brought under chapter 10 (Non-judicial
dissolution) or 11 (Judicial dissolution).
(2) An
action under section 1201 (Action by judgment creditor for sequestration).
(3) An
action brought by the Nation Prosecutor or by a shareholder to preserve
the assets of a corporation.
(4) An
action to preserve the assets of any kind, tangible or intangible,
of a foreign corporation which has been dissolved, nationalized or
its authority or existence otherwise terminated or canceled in the
jurisdiction of its incorporation or which has ceased to do business,
brought by any creditor or shareholder of such corporation or by one
on whose behalf an order of attachment against the property of such
corporation has been issued.
(b) A receiver
shall be subject to the control of the court at all times and may be
removed by the court at any time.
(c) All
actions or special proceedings brought by or against a receiver shall
have a preference.
1203. TEMPORARY AND PERMANENT RECEIVER
(a) At
any stage before final judgment or final order in an action or special
proceeding brought under this chapter, the court may appoint one or
more receivers of the property of the corporation or of the property
of a foreign corporation against which an action has been brought under
subparagraph (a)(4) of section 1202 (Appointment of receiver of property
of a domestic or foreign corporation). Notice of an application for
the appointment of a receiver shall be given to the Nation Prosecutor
and to such other persons and in such manner as the court directs. The
determination by the court of the necessity or advisability of appointing
a receiver or an attorney for a receiver, and the allowance of expenses,
commissions or compensation to the receiver or his attorney, shall be
subject to review on appeal. This provision shall not affect any other
right to review on appeal.
(b) A receiver
appointed by or under a final judgment or order in an action or special
proceeding, or a temporary receiver who is continued by the final judgment
or order, is a permanent receiver. The court may confer upon a temporary
receiver the powers, and subject him to the duties of a permanent receiver,
or so much thereof as it deems proper.
1204. OATH AND SECURITY
(a) A receiver,
before entering upon his duties, shall:
(1) Take
and subscribe an oath that he will faithfully, honestly and impartially
discharge the trust committed to him, and the oath shall be filed
with the clerk of the court in which the action or special proceeding
is pending.
(2) File
with the clerk of such court a bond, with at least two sufficient
sureties or a bond executed by any fidelity or surety company in a
penalty fixed by the court appointing him, conditioned for the faithful
discharge of his duties as receiver. The court may at any time direct
a receiver to give a new bond with new sureties and with like condition.
1205. DESIGNATION OF DEPOSITORIES BY COURT
All orders
appointing a receiver of a corporation shall designate therein one or
more places of deposit, wherein all funds of the corporation not needed
for immediate distribution shall be deposited and no other deposits
and no investment of such funds shall be made, except upon the order
of the court.
1206. POWERS OF PERMANENT RECEIVER
(a) A permanent
receiver, upon qualifying under section 1204 (Oath and security), shall
be vested with title to all the property of the corporation wherever
situated or of the property within the territorial jurisdiction of the
Nation of a foreign corporation against which an action or special proceeding
has been brought under subparagraph (a)(4) of section 1202 (Appointment
of receiver of property of a domestic or foreign corporation), for the
benefit of the creditors and shareholders of the corporation.
(b) A permanent
receiver shall have the power:
(1) To
sue his own name or otherwise for the recovery of the property, debts
and causes of action of the corporation. No set-off or counterclaim
shall be allowed in any such action for any demand unless it was owing
by the corporation to the defendant before the commencement of the
action or special proceeding in which the receiver was appointed or
unless it shall have been incurred by the receiver subsequent to his
appointment.
(2) To
sell at public or private sale all the property vested in him, in
such manner and on such terms and conditions as the court shall direct,
and to make necessary transfers and conveyances thereof
(3) To
examine on oath, to be administered by him, any person concerning
any matter pertaining to or affecting the receivership.
(4) To
settle or compound any demands by or against the receivership.
(c) When
more than one receiver is appointed, all provisions in this chapter
in reference to one receiver shall apply to them.
(d) When
more than one receiver is appointed, the debts and property of the corporation
may be collected and received by any of them; when more than two receivers
are appointed, the powers and rights conferred on them may be exercised
by any two.
(e) When
more than one receiver is appointed, the survivor or survivors of such
receivers shall have all the powers and right of the receivers.
1207. DUTIES OF RECEIVER UPON APPOINTMENT
(a) Upon
appointment and qualification, a receiver shall have the following duties:
(1) To
give immediate notice of his appointment by publication once a week
for two successive weeks in two newspapers of general circulation
in Madison County, New York or, in the case of a foreign corporation
against which an action has been brought under subparagraph (a)(4)
of section 1202 (Appointment of receiver of property of a domestic
or foreign corporation), in a newspaper of general circulation as
directed by the court, requiring:
A)
All persons indebted to the corporation to render an account of
all debts owing by them to the corporation and to pay the same to
the receiver at a specified place and by a specified day.
B)
All persons having in their possession any property of the corporation
to deliver the same to the receiver at the specified place and by
the specified day.
C)
All creditors and claimants, including any with unliquidated or
contingent claims and any with whom the corporation has unfulfilled
contracts, to present their claims to the receiver in writing and
in detail at a specified place and by a specified day, which shall
not be less than six months after the first publication of such
notice. Whenever a receiver is appointed in dissolution proceedings
under chapter 10 (Non-judicial dissolution) or chapter 11 (Judicial
dissolution), section 1007 (Notice to creditors; filing or barring
claims) shall apply and shall control the giving of notice to creditors
and claimants and the filing and barring of claims.
(2) To
call a general meeting of the creditors of the corporation within
four months from the date of his appointment by a notice to be published
as directed in subparagraph (a)(1), setting forth the time and place
of such meeting, which time shall be not more than two months, nor
less than one month after the first publication of such notice. At
such meeting, or at an adjournment thereof, the receiver shall present
a statement of all accounts and demands for and against the corporation,
its subsisting contracts, and the money and other assets in his hands.
(3) To
keep true books of account of all moneys received and expended by
him as receiver, which books shall be open for inspection at reasonable
times by creditors or other persons interested therein. On or before
the first day of February in each year, for the preceding calendar
year, and at such other times as the court shall direct, the receiver
shall file with the clerk of the court by which he was appointed a
verified statement showing the assets received, the disposition thereof,
the money on hand, all payments made, specifying the persons to whom
paid and the purpose of the payments, the amount necessary to be retained
to meet necessary expenses and claims against the receiver, and the
distributive share in the remainder of each person interested therein.
A copy of such statement shall be served by the receiver upon the
Nation Prosecutor within five days after the filing thereof.
1208. PENALTY FOR CONCEALING PROPERTY FROM RECEIVER
Any persons
having possession of property belonging to the corporation, who shall
wrongfully withhold such property from the receiver after the day specified
in the notice given under section 1207 (Duties of receiver upon appointment),
shall forfeit to the receiver double the value of such property, and
the same may be recovered in an action by the receiver.
1209. RECOVERY OF ASSETS
(a) Whenever
a receiver, by verified petition to the Nation court shall show that
he has good reason to believe that any person has in his possession
or under his control, or has wrongfully concealed, withheld or disposed
of, any property of the corporation, or that any person can testify
concerning such facts, the court, with or without notice, shall make
an order requiring such person to appear before the court or a referee,
at a time and place designated, and submit to an examination concerning
such facts. In such order, or at any time thereafter, in its discretion,
the court may enjoin and restrain such person from disposing of any
property of the corporation in his possession or under his control.
(b) In
any examination under such order, the court may confer immunity.
(c) A person
so ordered to appear shall be subject to the same penalties upon failure
to appear and testify in obedience to such order as are provided by
law in the case of witnesses who fail to obey a subpoena to appear and
testify in an action.
(d) A person
appearing for examination in obedience to such order shall be sworn,
and shall be entitled to represented on such examination by counsel,
and may be cross-examined, or may make a voluntary statement in his
own behalf concerning the subject of his examination.
(e) The
testimony taken under such order shall be signed and sworn to by the
person examined, and be filed in the office of the clerk of the Nation
court. If it shall appear that any person is wrongfully concealing or
withholding, or has in his possession or under his control, any property
of the corporation, on notice to him, the court may make an order requiring
him forthwith to deliver it to the receiver, subject to the further
order of the court.
1210. ORDER OF PAYMENT BY RECEIVER
(a) Laborers'
wages shall be preferred claims and entitled to payment before any other
creditors out of the assets of the corporation in excess of valid prior
liens or encumbrances.
(b) The
receiver shall, subject to any prior liens or encumbrances, distribute
the residue of the moneys in his hands, among the creditors whose claims
have been proved and allowed, as follows:
(1) All
debts due by such corporation to the Oneida Indian Nation and all
debts entitled to a preference under applicable laws.
(2) All
debts that may be owing by the corporation as trustee.
(3) Judgments
against the corporation, to the extent of the value of the real property
on which they are liens.
(4) All
other creditors, in proportion to their respective demands, without
preferences to specialty debts.
1211. FINAL DISTRIBUTION BY RECEIVER
(a) If
there remains property of the corporation after the first distribution,
the receiver shall, within one year thereafter, make a final distribution
among the creditors entitled thereto.
(b) A creditor
or claimant who failed to prove his claim before the first distribution
and who proves it before the final one shall receive the sum he would
have been entitled to on the first distribution before any further distribution
shall be made to other creditors or claimants.
(c) Unless
the court shall otherwise direct, no other distribution shall be made
thereafter to creditors, except to those having pending actions against
the corporation or the receiver.
(d) After
the final distribution to creditors, the receiver shall not be answerable
to any creditor or claimant, unless his claim shall have been proved
before or at the time specified in the notice of the final distribution.
1212. DISPOSITION OF MONEYS RETAINED; SURPLUS; UNCLAIMED DISTRIBUTIONS
(a) When
any action pending at the time of the final distribution shall be terminated,
the receiver shall apply the moneys retained by him to the payment of
the amount recovered, and his necessary charges and expenses incurred
therein.
(b) After
the final distribution to creditors and after deducting his charges
and expenses, the receiver shall distribute any surplus among the shareholders
of the corporation, in accordance with their respective rights.
(c) Any
portion of the assets distributable to a creditor or shareholder who
is unknown or cannot be found, or who is under disability and for whom
there is not legal representative, shall be paid by the receiver to
the Nation as abandoned property within six months from the date fixed
for the payment of the final liquidating distribution, and be subject
to the provisions of the abandoned property law.
1213. OMISSION OR DEFAULT OF RECEIVER
Upon notice
to the Nation Prosecutor and upon such notice to creditors or others
interested as the court shall direct, the court may, in the furtherance
of justice, relieve a receiver from any omission or default, on such
conditions as may be imposed, and, on compliance therewith, confirm
his action.
1214. APPLICATION BY NATION PROSECUTOR FOR REMOVAL OF RECEIVER AND
TO CLOSE RECEIVERSHIP
(a) Whenever
he deems it to be to the advantage of the shareholders, creditors or
other persons interested in the assets of any corporation for which
a receiver has been appointed, the Nation Prosecutor may move:
(1) For
an order removing the receiver and appointing another in his stead;
(2) To
compel the receiver to account;
(3) For
such other and additional orders as may facilitate the closing of
the receivership
1215. RESIGNATION BY RECEIVER, FILLING ANY VACANCY
(a) A receiver
may petition the court appointing him for an order to show cause why
he should not be permitted to resign.
(b) The
petition shall be accompanied by a verified account of all the assets
of the corporation received by him, of all payments or other disposition
thereof made by him, of the remaining assets of the corporation in respect
to which he was appointed receiver and the situation of the same, and
of all his transactions as receiver. Thereupon, the court shall grant
an order directing notice to be given to the sureties on his official
bond and to all persons interested in the property of the corporation
to show cause, at a time and place specified, why the receiver should
not be permitted to resign. If it shall appear that the proceedings
of the receiver in the discharge of his trust have been fair and honest
and that there is not good cause to the contrary, the court shall make
an order permitting such receiver to resign. Thereupon he shall be discharged
and his powers as receiver shall cease, but he shall remain subject
to any liability incurred prior to the making of such order. The court,
in its discretion, may require the expense of such proceeding to be
paid by the receiver presenting the petition.
(c) Any
vacancy created by resignation, removal, death or otherwise, may be
filled by the court, and the property of the receivership shall be delivered
to the remaining receivers or, if there are none, to the successor appointed
by the court. The court may summarily enforce delivery by order in the
action or special proceeding in which the receiver was appointed.
1216. FINAL ACCOUNTING; NOTICE; DUTY OF NATION PROSECUTOR .
(a) Within
one year after qualifying, the receiver shall apply to the court for
a final settlement of his accounts and for an order for distribution,
or, upon notice to the Nation Prosecutor, for an extension of time,
setting forth the reasons therefore. If the receiver has not so applied
for a settlement of his accounts or for such extension of time, the
Nation Prosecutor or any creditor or shareholder may apply for an order
that the receiver show cause why an accounting and distribution should
not be had, and after the expiration of eighteen months from the time
the receiver qualified, it shall be the duty of the Nation Prosecutor
to apply for such an order on notice to the receiver.
(b) Before
presenting a final account, the receiver shall give notice of his intention
to file it by publication, under subparagraph (a)(1) of section 1207
(Duties of receiver upon appointment), setting forth the time and place
of filing and presentation to the court. The receiver shall also give
not less than eight days' written notice to the sureties on his official
bond.
(c) Upon
presentation of such account, the court shall hear the allegations,
objections and proofs of all parties interested and allow or disallow
such account, in whole or in part, and make a final order. The court
may refer the account and the hearing, in whole or in part, to a referee
who shall report thereon to the court.
1217. COMMISSIONS
(a) A receiver
shall be entitled, in addition to his necessary expenses, to such commissions
upon the sums received and disbursed as may be allowed by the court,
as follows:
(1) On
the first twenty thousand dollars, not exceeding five percent;
(2) On
the next eighty thousand dollars, not exceeding two and one-half percent;
and
(3) On
the remainder, not exceeding one percent.
(b) If
the commissions of the receiver so computed do not amount to one hundred
dollars, the court in its discretion may allow such sum not exceeding
one hundred dollars as shall be reasonable.
(c) When
more than one receiver shall be appointed, the compensation herein provided
shall be divided between them, as the court directs.
1218. SPECIAL PROVISIONS RELATING TO ACTIONS OR SPECIAL PROCEEDINGS
AGAINST FOREIGN CORPORATIONS
(a) In
any action or special proceeding brought against a foreign corporation
under this chapter, the following provisions shall apply.
(1) Service
of the summons in such action may be made personally within the territorial
jurisdiction of the Oneida Indian Nation, by delivery of the same
to any officer or director of the corporation, or by publication pursuant
to an order obtained as hereinafter provided.
(2) An
order directing service by publication of the summons shall be made
upon application of a plaintiff in any such action and shall be founded
upon a verified complaint, alleging that the defendant is a foreign
corporation and has or may have or may be entitled to assets, credits,
chose in action or other property, tangible or intangible within the
territorial jurisdiction of the Oneida Indian Nation and that such
corporation has been dissolved, nationalized or that its authority
or existence has been terminated or canceled in the jurisdiction of
its incorporation, or that it has ceased to do business, and upon
an affidavit reciting that personal service of the summons cannot
be effected within the territorial jurisdiction of the Oneida Indian
Nation with due diligence and that a temporary receiver of its property
within the territorial jurisdiction of the Oneida Indian Nation has
been appointed pursuant to this chapter in such action and that a
copy of the order appointing the receiver has been served personally
by or on behalf of such receiver upon a person, firm or corporation
holding property, tangible or intangible, of the said foreign corporation
exists and that demand therefore has been made upon such person, firm
or corporation by or on behalf of such receiver.
(3) The
order directing service of the summons shall require the publication
thereof in a newspaper published in the general locality of the Nation
in the Oneida or English language at least once a week for four successive
weeks, and shall also require the mailing on or before the date of
the first publication of a copy of the summons, complaint and order
to the corporation at its last known principal or head office in the
stated or country of its incorporation.
(4) In
any such action, the summons shall be served personally or an order
directing service thereof by publication shall be obtained and the
first publication thereof made within sixty days after the appointment
of the temporary receiver, and if served by publication, the service
shall be made complete by the continuance thereof.
(5) If
served by publication, service of the summons shall be deemed complete
on the date of the last publication. The action shall be deemed commenced
upon the issuance of the summons. The order appointing the receiver
and the paper upon which the same is granted shall be filed in the
office of the clerk of the court where the action is triable within
ten days after the order is made.
(6) In
the event that the defendant defaults in answering, or if after a
trial the court is satisfied that the defendant has ceased to do business
by reason of any thing or matter whatsoever, or that it has been dissolved,
nationalized, or its authority or existence has been otherwise terminated
or canceled, the court shall thereupon direct judgment, appointing
a permanent receiver and directing the receiver to liquidate the assets,
credits, chose in action and property, tangible and intangible, within
the territorial jurisdiction of the Nation of the said defendant,
in the manner provided in this chapter.
(7) The
time between the cessation of business by the corporation or its dissolution
or nationalization or the termination or cancellation of its authority
or existence and the appointment of a receiver pursuant to this chapter,
whichever time is longer, plus three years after such appointment,
shall not be a part of the time limited by domestic or foreign law
for the commencement of an action or for the assertion of a claim
therein by or no behalf of or against said corporation or by or against
said receiver, whether or not said action or claim has heretofore
been barred by any statute of limitations of the Nation or any other
Indian Nation or country.
(8) The
existence of and cause of action of or against such corporation existing
at the time of its dissolution, nationalization, or the termination
or cancellation of its authority or existence, or arising thereafter,
shall not be deemed ended, abated or affected thereby, nor shall actions
brought by or against such corporation or a receiver appointed hereunder
or any remedy therein be deemed to have ended or abated or to have
been affected by reason of such dissolution, nationalization, or termination
or cancellation of its authority or existence. This provision shall
apply to all property, tangible and intangible, debts, demands, and
chooses in action of such corporation within the Nation, and to all
litigation heretofore or hereafter brought in the Nation court to
which the corporation or the receiver of said corporation appointed
pursuant to the provisions of this chapter is a party. Any receiver
appointed pursuant to the provisions of the article may be substituted
for such corporation in any action or proceeding pending in the Nation
court to which such corporation is a party and may intervene in any
action or proceeding which relates to or affects any of the assets
or claims of the corporation and revive any action which shall have
heretofore or which may hereafter have abated, and such dissolution,
nationalization, or termination or cancellation of its authority or
existence in the jurisdiction of its incorporation, or any confiscatory
law or decree thereof, shall not be deemed to have any extra-territorial
effect or validity as to the property, tangible or intangible, debts,
demands or chooses in action of such corporation within the territorial
jurisdiction of the Nation or any debts or obligations owing to such
corporation from persons, firms or corporations residing, sojourning
or doing business within the territorial jurisdiction of the Nation.
Nothing contained in this subdivision shall be deemed to validate
claims for or causes of action or actions to recover property located
in or moneys payable in the jurisdiction of incorporation which are
unenforceable under the laws of such jurisdiction.
(9) If
any receiver or trustee has heretofore been appointed for such corporation
or its property in any action or proceeding, either before or supplementary
to judgment, otherwise than in an action brought pursuant to this
article, such receiver or trustee may be appointed or continued as
the receiver in any action brought pursuant to the provisions of this
chapter.
(10)
The appointment of a receiver or the pendency of an action for the
appointment of such receiver, shall until such receiver shall be discharged
or until such action shall have terminated, be a bar to any subsequent
application or action for the appointment of a receiver of the assets
of the same corporation.
(11)
An action shall be commenced within three years from the discovery
by the plaintiff or his predecessor in interest, of any asset of said
corporation within the territorial jurisdiction of the Nation.
CHAPTER 13 - FOREIGN CORPORATIONS
1301. AUTHORIZATION OF FOREIGN CORPORATIONS
(a) A foreign
corporation shall not do business within the territorial jurisdiction
of the Nation until is has been authorized to do so as provided in this
chapter. A foreign corporation may be authorized to do within the territorial
jurisdiction of the Nation any business which may be done lawfully within
the territorial jurisdiction of the Nation by a domestic corporation,
to the extent that it is authorized to do such business in the jurisdiction
of its incorporation, but no other business.
(b) Without
excluding other activities which may not constitute doing business within
the territorial jurisdiction of the Nation, a foreign corporation shall
not be considered to be doing business within the territorial jurisdiction
of the Nation, for the purposes of this chapter, by reason of carrying
on within the territorial jurisdiction of the Nation any one or more
of the following activities:
(1) Maintaining
or defending any action or proceeding, whether judicial, administrative,
arbitrative or otherwise, or effecting settlement thereof or the settlement
of claims or disputes.
(2) Holding
meetings of its directors or its shareholders.
(3) Maintaining
bank accounts.
(4) Maintaining
offices or agencies only for the transfer, exchange and registration
of its securities, or appointing and maintaining trustees or depositaries
with relation to its securities.
(c) The
specification in paragraph (b) does not establish a standard for activities
which may subject a foreign corporation to service of process under
this chapter or any other statute of the Nation.
(d) A foreign
corporation whose corporate name is not acceptable for authorization
pursuant to section 301 and 302 of this chapter, may submit in its application
for authority pursuant to section 1304 of this chapter, a fictitious
name under which it shall do business in the Nation. A fictitious name
submitted pursuant to this section shall be subject to the provisions
of subparagraphs (2) through (9) of paragraph (a) of section 301 and
302 of this chapter. A foreign corporation authorized to do business
within the territorial jurisdiction of the Nation under a fictitious
name pursuant to this section, shall use such fictitious name in all
of its dealings with the Nation Clerk and in the conduct of its business
within the territorial jurisdiction of the Nation.
1302. APPLICATION TO EXISTING AUTHORIZED FOREIGN CORPORATIONS
Every foreign
corporation which on the effective date of this chapter is authorized
to do business within the territorial jurisdiction of the Nation under
a certificate of authority heretofore issued to it by the Nation Clerk
shall continue to have such authority. Such foreign corporation, its
shareholders, directors and officers shall have the same rights, franchises
and privileges and shall be subject to the same limitations, restrictions,
liabilities and penalties as a foreign corporation authorized under
this chapter, its shareholders, directors and officers respectively.
Reference in this chapter to an application for authority shall, unless
the context otherwise requires, include the statement and designation
and any amendment thereof required to be filed by the Nation Clerk under
prior statutes to obtain a certificate of authority.
1303. VIOLATIONS
The Nation
Prosecutor may bring an action to restrain a foreign corporation from
doing within the territorial jurisdiction of the Nation without authority
any business for the doing of which it is required to be authorized
within the territorial jurisdiction of the Nation, or from doing within
the territorial jurisdiction of the Nation any business not set forth
in its application for authority or certificate of amendment filed by
the Nation Clerk. The Nation Prosecutor may bring an action or special
proceeding to annul the authority of a foreign corporation doing within
the territorial jurisdiction of the Nation any business not set forth
in its application for authority or certificate of amendment or the
authority of which was obtained through fraudulent misrepresentation
or concealment of a material fact or to enjoin or annul the authority
of any foreign corporation which within the territorial jurisdiction
of the Nation contrary to law has done or omitted any act which if done
by a domestic corporation would be a cause for its dissolution under
section 1101 (Nation Prosecutor action for judicial dissolution) or
to annul the authority of a foreign corporation that has been dissolved
or had its authority or existence otherwise terminated or canceled in
the jurisdiction of its incorporation. The Nation Prosecutor shall deliver
a certified copy of the order of annulment to the secretary of state.
Upon the filing thereof by the Nation Clerk the authority of the foreign
corporation to do business within the territorial jurisdiction of the
Nation shall be annulled. The Nation Clerk shall continue as agent of
the foreign corporation upon whom process against it may be served in
any action or special proceeding based upon any liability or obligation
incurred by the foreign corporation within the territorial jurisdiction
of the Nation prior to the filing of the certified copy of the order
of annulment by the Nation Clerk.
1304. APPLICATION FOR AUTHORITY; CONTENTS
(a) A foreign
corporation may apply for authority to do business within the territorial
jurisdiction of the Nation. An application, entitled "Application
for authority of .......... (name of corporation) under section 1304
of the Business Corporation Code", shall be signed and verified
by an officer of or attorney-in-fact for the corporation and delivered
to the Nation Clerk. It shall set forth:
(1) The
name of the foreign corporation.
(2) The
fictitious name the corporation agrees to use within the territorial
jurisdiction of the Nation pursuant to section 1301 of this chapter,
if applicable.
(3) The
jurisdiction and date of its incorporation.
(4) The
purpose or purposes for which it is formed, it being sufficient to
state, either alone or with other purposes, that the purpose of the
corporation is to engage in any lawful act or activity for which corporations
may be organized under this chapter, provided that it also state that
it is not formed to engage in any act or activity requiring the consent
or approval of the Nation, department, board, agency or other body
without such consent or approval first being obtained. By such statement
all lawful acts and activities shall be within the purposes of the
corporation, except for express limitations therein or in this chapter,
if any.
(5) The
address of its office.
(6) A
designation of the Nation Clerk as its agent upon whom process against
it may be served and the post office address to which the Nation Clerk
shall mail a copy of any process against it served upon him.
(7) If
it is to have a registered agent, his name and address within the
Nation and a statement that the registered agent is to be its agent
upon whom process against it may be served.
(8) A
statement that the foreign corporation has not since its incorporation
or since the date its authority to do business within the territorial
jurisdiction of the Nation was last surrendered, engaged in any activity
within the territorial jurisdiction of the Nation, except as set forth
in paragraph (b) of section 1301 (Authorization of foreign corporations),
or in lieu thereof the consent of the Nation to the filing of the
application, which consent shall be attached thereto.
(b) Attached
to the application for authority shall be a certificate by an authorized
officer of the jurisdiction of its incorporation that the foreign corporation
is an existing corporation. If such certificate is in a foreign language,
a translation thereof under oath of the translator shall be attached
thereto.
1305. APPLICATION FOR AUTHORITY; EFFECT
Upon filing
by the Nation Clerk of the application for authority the foreign corporation
shall be authorized to do within the territorial jurisdiction of the
Nation any business set forth in the application. Such authority shall
continue so long as it retains its authority to do such business within
the territorial jurisdiction of the Nation has not been surrendered,
suspended or annulled in accordance with law.
1306. POWERS OF AUTHORIZED FOREIGN CORPORATIONS
An authorized
foreign corporation shall have such powers as are permitted by the laws
of the jurisdiction of its incorporation but no greater powers than
that of a domestic corporation formed for the business set forth in
the application for authority.
1307. TENURE OF REAL PROPERTY
A foreign
corporation may acquire and hold real property in the Nation in furtherance
of its corporate purposes and may convey the same by deed or otherwise
in the same manner as a domestic corporation.
1308. AMENDMENTS OR CHANGES
(a) An
authorized foreign corporation may amend or change its application for
authority from time to times in any and as many of the following respects
as may be desire if the amendments contain only such provisions as might
be lawfully contained in an application for authority at the time of
making such amendment:
(1) To
change its corporate name if such change has been effected under the
laws of the jurisdiction of its incorporation.
(2) To
change its fictitious name filed pursuant to paragraph (d) of section
1301 of this chapter, to another fictitious name, if its true corporate
name is not available for use within the territorial jurisdiction
of the Nation.
(3) To
delete its fictitious name filed pursuant to paragraph (d) of section
1301 of this chapter, if its true corporate name is now available
for use in the Nation.
(4) To
adopt a fictitious name when the corporate name is changed and is
not available in the Nation.
(5) To
enlarge, limit or otherwise change the business which it proposes
to do in the Nation.
(6) To
change the location of its office in the Nation.
(7) To
specify or change the post office address to which the Nation Clerk
shall mail a copy of any process against it served upon him.
(8) To
make, revoke or change the designation of a registered agent or to
specify or change his address.
(9) To
change the jurisdiction of its incorporation if such change has been
effected under laws permitting such a change to occur.
1309. CERTIFICATE OF AMENDMENT; CONTENTS, EFFECT
(a) to
accomplish such amendment a certificate, entitled "Certificate
of amendment of application for authority of .......... (name of corporation)
under section 1309 of the Business Corporation Code", shall be
signed and verified by an officer of or attorney-in-fact for the foreign
corporation and delivered to the Nation Clerk. It shall set forth:
(1) The
name of the foreign corporation as it appears on the index of names
of existing domestic and authorized foreign corporations of any type
or kind in the Nation Clerk, division of corporations and the fictitious
name the corporation has agreed to use in the Nation pursuant to paragraph
(d) of section 1301 of this chapter.
(2) The
jurisdiction of its incorporation. If the jurisdiction of its incorporation
has been changed, a statement that the change of jurisdiction has
been effected under laws permitting such a change to occur, citing
such laws, and including the date the change in jurisdiction was so
effected; and a statement that annexed to this certificate of amendment
of application for authority is the certificate required by paragraph
(b) of this section.
(3) The
date it was authorized to do business in the Nation.
(4) Each
amendment effected thereby.
(5) If
the true corporate name of the foreign corporation is to be changed,
a statement that the change of name has been effected under the laws
of the jurisdiction of its incorporation and the date the change was
so effected.
(6) If
the business it proposes to do in the Nation is to be enlarged, limited
or otherwise changed, a statement that it is authorized to do in the
jurisdiction of its incorporation the business which it proposes to
do in the Nation.
(b) If
the jurisdiction of its incorporation has been changed, annexed to the
certificate of amendment of application for authority shall be a certificate
by an authorized officer of the new jurisdiction of its incorporation
that such foreign corporation is an existing corporation domiciled in
that jurisdiction. If the annexed certificate by an authorized officer
is not in the Oneida or English language, there shall be attached thereto
a translation thereof in the Oneida or English language under oath of
the translator.
(c) If
an authorized foreign corporation has changed its name in the jurisdiction
of its incorporation, or has changed its jurisdiction of incorporation,
it shall deliver to the secretary of state within twenty days after
the change became effective in that jurisdiction a certificate of amendment
under paragraph (a) of this section. Upon its failure to deliver such
certificate, its authority to do business within the territorial jurisdiction
of the Nation shall upon the expiration of said twenty days be suspended.
The filing by the Nation Clerk of a certificate of amendment changing
the corporate name or jurisdiction of incorporation within one hundred
twenty days after the effective date of the change of name in the jurisdiction
of its incorporation or of the change of jurisdiction of its incorporation
effected under laws permitting such a change to occur shall annul the
suspension and its authority to do business within the territorial jurisdiction
of the Nation shall be restored and continue as if no suspension had
occurred. The Nation Clerk shall continue as agent of the foreign corporation
upon whom process against the foreign corporation may be served in the
manner set forth in paragraph (b) of section 306 (Service of process),
in any action or special proceeding based upon any liability or obligation
incurred by it within the territorial jurisdiction of the Nation before
the filing of the certificate of amendment changing the corporate name
or changing the jurisdiction of incorporation.
1309-A. CERTIFICATE OF CHANGE; CONTENTS
(a) In
lieu of a certificate of amendment, an authorized foreign corporation,
upon compliance with this section, may make any or all of the following
changes in its application for authority:
(1) To
change the location of its office in the Nation.
(2) To
specify or change the post office address to which the Nation Clerk
shall mail a copy of any process against it served upon him.
(3) To
make, revoke or change the designation of a registered agent or specify
or change his address.
(b) To
accomplish such change, a certificate entitled "Certificate of
change of application for authority of ...... (name of corporation)
under section 1309-A of the Business Corporation Code" shall be
signed and verified by an officer or attorney-in-fact for the foreign
corporation and delivered to the Nation Clerk.
It shall
set forth:
(1) The
name of the foreign corporation as it appears on the index of names
of existing domestic and authorized foreign corporations of any type
or kind in the Nation Clerk, division of corporations and the fictitious
name the corporation has agreed to use within the territorial jurisdiction
of the Nation pursuant to paragraph (d) of section 1301 of this chapter.
(2) The
jurisdiction of its incorporation.
(3) The
date it was authorized to do business in the Nation.
(4) Each
change effected thereby.
(c) A certificate
of change of application for authority which changes only the post address
to which the Nation Clerk shall mail a copy of any process against an
authorized foreign corporation served upon him or which changes the
address of its registered agent, provided such address is the address
of a person, partnership or other corporation whose address, as agent,
is the address to be changed or who has been designated as registered
agent for such authorized foreign corporation, may be signed, verified
and delivered to the Nation Clerk by such agent. The certificate of
change of application for authority shall set forth the statements required
under subparagraphs (a)(1), (2), (3) and (4) of this section; that a
notice of the proposed change was mailed by the party signing the certificate
to the authorized foreign corporation not less than thirty days prior
to the date of delivery to the secretary and that such corporation has
not objected thereto; and that the party signing the certificate is
the agent of such foreign corporation to whose address the Nation Clerk
is required to mail copies of process or the registered agent, if such
be the case. A certificate signed, verified and delivered under this
paragraph shall not be deemed to effect a changed of location of the
office of the corporation in whose behalf such certificate is filed.
1310. SURRENDER OF AUTHORITY
(a) An
authorized foreign corporation may surrender its authority. A certificate,
entitled "Certificate of surrender of authority of .......... (name
of corporation) under section 1310 of the Business Corporation Code'',
shall be signed, verified by an officer of or attorney-in-fact for the
foreign corporation or by a trustee, receiver or other liquidator of
such corporation, and delivered to the Nation Clerk. It shall set forth:
(1) The
name of the foreign corporation as it appears on the index of names
of existing domestic and authorized foreign corporations of any type
or kind in the Nation Clerk, division of corporations or, the fictitious
name the corporation has agreed to use in the Nation pursuant to paragraph
(d) of section 1301 of this chapter.
(2) The
jurisdiction of its incorporation.
(3) The
date it was authorized to do business in the Nation.
(4) That
it surrenders its authority to do business within the territorial
jurisdiction of the Nation.
(5) That
it revokes the authority of its registered agent, if any, previously
designated and consents that process against it in any action or special
proceeding based upon any liability or obligation incurred by it within
the Nation before the filing of the certificate of surrender may be
served on the Nation Clerk after the filing thereof in the manner
set forth in paragraph (b) of section 306 (Service of process).
(6) A
post office address within or without the Nation to which the Nation
Clerk shall mail a copy of any process against it served upon him.
(b) The
Nation Clerk shall not file such certificate unless the consent of the
Oneida Indian Nation to the surrender of authority is attached thereto.
(c) The
authority of the foreign corporation to do business in the Nation shall
terminate on the filing by the Nation Clerk of the certificate of surrender
of authority.
(d) The
post office specified under subparagraph (a)(6) may be changed. A certificate,
entitled "Certificate of amendment of certificate of surrender
of authority of .......(name of corporation) under section 1310 of the
Business Corporation Code", shall be signed, verified as provided
in paragraph (a) and delivered to the Nation Clerk. It shall set forth:
(1) The
name of the foreign corporation.
(2) The
jurisdiction of its incorporation.
(3) The
date its certificate of surrender of authority was filed by the Nation
Clerk.
(4) The
changed post offices address to which the Nation Clerk shall mail
a copy of any process against it served upon him.
1311. TERMINATION OF EXISTENCE
When an
authorized foreign corporation is dissolved, or its authority or existence
is otherwise terminated or canceled in the jurisdiction of its incorporation
or when such foreign corporations is merged into or consolidated with
another foreign corporation, a certificate of the Nation Clerk, or official
performing the equivalent function as to corporate records, of the jurisdiction
of incorporation if such foreign corporation attesting to the occurrence
of any such event or a certified copy of an order or decree of a court
of such jurisdiction directing the dissolution of such foreign corporation,
the termination of its existence or the cancellation of its authority
shall be delivered to the Nation Clerk. The filing of the certificate,
order or decree shall have the same effect as the filing of a certificate
of surrender of authority under section 1310 (Surrender of authority).
The Nation Clerk shall continue as agent of the foreign corporation
upon whom process against it may be served in the manner set forth in
paragraph (b) of section 306 (Service of process), in any action or
special proceeding based upon any liability or obligation incurred by
the foreign corporation within the territorial jurisdiction of the Nation
prior to the filing of such certificate, order of decree and he shall
promptly cause a copy of any such process to be mailed by registered
mail, return receipt requested, to such foreign corporation at the post
office address on file in his office specified for such purpose. The
post office address may be changed by signing, verifying and delivering
to the Nation Clerk a certificate of change setting forth the statements
required under section 1309-A (Certificate of change; contents) to effect
a change in the post office address under subparagraph (a)(4) of section
1308 (Amendments or changes).
1312. ACTIONS OR SPECIAL PROCEEDINGS BY UNAUTHORIZED -FOREIGN CORPORATIONS
(a) A foreign
corporation doing business within the territorial jurisdiction of the
Nation without authority shall not maintain any action or special proceeding
in the Nation unless and until such corporation has been authorized
to do business in the Nation and it has paid to the Nation all fees
and taxes imposed under the law, as well as penalties and interest charges
related thereto, accrued against the corporation. This prohibition shall
apply to any successor in interest of such foreign corporation.
(b) The
failure of a foreign corporation to obtain authority to do business
in the Nation shall not impair the validity of any contract or act of
the foreign corporation or the right of any other party to the contract
to maintain any action or special proceeding thereon, and shall not
prevent the foreign corporation from defending any action or special
proceeding in the Nation.
1313. ACTIONS OR SPECIAL PROCEEDING BY FOREIGN CORPORATIONS
An action
or special proceeding may be maintained by a foreign corporation, in
like manner and subject to the same limitations, as an action or special
proceeding brought by a domestic corporation, except as otherwise prescribed
by statute.
1314. ACTIONS OR SPECIAL PROCEEDINGS AGAINST FOREIGN CORPORATIONS
(a) An
action or special proceeding against a foreign corporation may be maintained
by a resident of the Nation or by a domestic corporation of any type
or kind for any cause of action.
(b) Except
as otherwise provided in this article, an action or special proceeding
against a foreign corporation may be maintained by another foreign corporation
of any type or kind or by a non-resident in the following cases only:
(1) Where
it is brought to recover damages for the breach of a contract made
or to be performed within the territorial jurisdiction of the Nation,
or relating to property situated within territorial jurisdiction of
the Nation at the time of the making of the contract.
(2) Where
the subject matter of the litigation is situated within the territorial
jurisdiction of the Nation.
(3) Where
the cause of action arose within the Nation, except where the object
of the action or special proceeding is to affect the title of real
property situated outside the territorial jurisdiction of the Nation.
(4) Where,
in any case not included in the preceding subparagraphs, a non-domiciliary
would be subject to the personal jurisdiction of the Nation court
under section 302 of the civil practice law and rules.
(5) Where
the defendant is a foreign corporation doing business or authorized
to do business in the Nation.
1315. RECORD OF SHAREHOLDERS
(a) Any
resident of the Nation who shall have been a shareholder of record,
for at least six months immediately preceding his demand, of a foreign
corporation doing business within the territorial jurisdiction of the
Nation, or any resident of the Nation holding, or thereunto authorized
in writing by the holders of, at least five percent of any class of
the outstanding shares, upon at least five days' written demand may
require such foreign corporation to produce a record of its shareholders
setting forth the names and addresses of all shareholders, the number
and class of shares held by each and the dates when they respectively
became the owners of record thereof and shall have the right to examine
in person or by agent or attorney at the office of the foreign corporation
in the Nation or at the office of its transfer agent or registrar in
the Nation in which the foreign corporation is doing business as may
be designated by the foreign corporation, during the usual business
hours, the record of shareholders or an exact copy thereof certified
as correct by the corporate officer or agent responsible for keeping
or producing such record and to make extracts therefrom. Resident holders
of voting trust certificates representing shares of the foreign corporation
shall for the purpose of this section be regarded as shareholders.
(b) An
examination authorized by paragraph (a) may be denied to such shareholder
or other person upon his refusal to furnish to the foreign corporation
or its transfer agent or registrar an affidavit that such inspection
is not desired for a purpose which is in the interest of a business
or object other than the business of the foreign corporation and that
such shareholder or other person has not within five years sold or offered
for sale any list of shareholders of any corporation of any type or
kind, whether or not formed under the laws of the Nation, or aided or
abetted any person in procuring any such record of shareholders for
any such purpose.
(c) Upon
refusal by the foreign corporation or by an officer or agent of the
foreign corporation to produce for examination or to permit an examination
of the record of shareholders as herein provided, the person making
the demand for production and examination may apply to the Oneida Indian
Nation upon such notice as the court may direct, for an order directing
the foreign corporation, its officer or agent, to show cause why an
order should not be granted directing such production and permitting
such examination by the applicant. Upon the return day of the order
to show cause, the court shall hear the parties summarily, by affidavit
or otherwise, and if it appears that the applicant is qualified and
entitled to such examination, the court shall grant an order compelling
such production for examination and awarding such further relief as
to the court may seem just and proper.
(d) Nothing
herein contained shall impair the court to compel the production for
examination of the books of a foreign corporation. The record of shareholders
specified in paragraph (a) shall be prima facie evidence of the facts
therein stated in favor of the plaintiff in any action or special proceeding
against such foreign corporation or any of its officer, directors or
shareholders.
1316. VOTING TRUST RECORDS
(a) A voting
trustee, appointed under a voting trust agreement to vote the shares
of a foreign corporation doing business in the Nation, who either has
an office in the Nation or has designated a transfer agent within the
Nation, shall produce for examination and permit to be examined in the
Nation, at the office of the foreign corporation or at his office or
at the office of such transfer agent, a record of voting trust certificate
holders setting forth their names, alphabetically arranged, and addresses,
the number and class of shares represented by the certificates held
by them respectively and the dates when they respectively became the
owners thereof, upon the written demand of any resident of the Nation
who shall have been a voting trust certificate holder or a shareholder
of the foreign corporation for at least six months immediately preceding
his demand, or of any resident of this state holding, or thereunto authorized
in Writing by the holders of, at least five percent of any class of
the outstanding shares of such foreign corporation, either directly
or as holders of voting trust certificates for such shares, subject
to the same terms and conditions set forth with respect to the right
of examination of the record of shareholders of the foreign corporation
in section 1315 (Record of shareholders).
(b) The
voting trustee shall deposit an exact copy of the voting trust agreement
with the foreign corporation at its office in the Nation or at the office
of the transfer agent in the Nation.
(c) The
copy of the voting trust agreement shall be subject to the same right
of examination by voting trust certificate holders and by shareholders
of the foreign corporation as is the record of shareholders of a corporation
under section 624 (Books and records; right of inspection, prima facie
evidence).
(d) Upon
refusal by a voting trustee or his transfer agent to produce for examination
or to permit an examination of the record of voting trust certificate
holders or of such copy of the voting trust agreement as herein provided,
the person making the demand may apply to the Nation court, upon such
notice as the court may direct, for an order directing the voting trustee
or his transfer agent to show cause why an order should not be granted
directing such production and permitting such examination. Upon the
return day of the order to show cause, the court shall hear the parties
summarily, by affidavit or otherwise, and if it appears that the applicant
is entitled to such examination, the court shall grant an order compelling
such production for examination and awarding such further relief as
to the court may seem just and proper.
(e) Where
the voting trust agreement shall vest in the voting trustee the right
to vote the shares of a foreign corporation which has an office in the
Nation for the doing of business where the principal business operation
of which is conducted within the Nation or the greater part of its property
is located within the Nation, and the voting trust agreement is an express
trust created under the laws of the Nation, Oneida Nation Court upon
the petition of a voting trust certificate holder, may exercise such
power over the trustee named therein.
1317. LIABILITIES OF DIRECTORS AND OFFICERS OF FOREIGN CORPORATIONS
(a) Except
as otherwise provided in this chapter, the directors and officers of
a foreign corporation doing business within the territorial jurisdiction
of the Nation are subject, to the same extent as directors and officers
of a domestic corporation, to the provisions of:
(1) Section
719 (Liability of directors in certain cases) except subparagraph
(a)(3) thereof, and
(2) Section
720 (Action against directors and officers for misconduct.)
(b) Any
liability imposed by paragraph (a) may be enforced in, and such relief
granted by, the Nation court, in the same manner as in the case of a
domestic corporation.
1318. LIABILITY OF FOREIGN CORPORATIONS FOR FAILURE TO DISCLOSE REQUIRED
INFORMATION
(a) A foreign
corporation doing business in the Nation shall, in the same manner as
a domestic corporation, disclose to its shareholders of record who are
residents of the Nation the information required under paragraph (c)
of section 510 (Dividends or other distributions in cash or property),
paragraphs (f) and (g) of section 511 (Share distributions and changes),
paragraph (d) of section 515 (Reacquired shares), paragraph (c) of section
516 (Reduction of stated capital in certain cases), subparagraph (a)(4)
of section 517 (Special provisions relative to surplus and reserves)
or paragraph (f) of section 519 (Convertible shares and bonds), and
shall be liable as provided in section 520 (Liability for failure to
disclose required information) for failure to comply in good faith with
these requirements.
(b) For
the purposes of this section, an authorized foreign corporation may
by board action determine the amount of its earned surplus before the
declaration of its first dividend after either (1) the effective date
of this chapter or (2) the date of filing of its application for authority
under this chapter, whichever is later; and such determination if made
in good faith shall be conclusive. Thereafter such foreign corporation
may determine the amount or availability of its earned surplus in the
same manner as a domestic corporation.
1319. APPLICABILITY OF OTHER PROVISIONS
(a) In
application to 1 (Short title; definitions; application; certificates;
miscellaneous) and 3 (Corporate name and service of process) and the
other sections of Chapter 13, the following provisions, to the extent
provided therein, shall apply to a foreign corporation doing business
within the territorial jurisdiction of the Nation, its directors, officers
and shareholders:
(1) Section
623 (Procedure to enforce shareholder's right to receive payment for
shares).
(2) Section
626 (Shareholders' derivative action brought in the right of the corporation
to procure a judgment in its favor).
(3) Section
627 (Security for expenses in shareholders’ derivative action
brought in the right of the corporation to procure a judgment in its
favor).
(4) Section
721 (Exclusivity of statutory provisions for indemnification of directors
and officers) through 727 (Insurance for indemnification of directors
and officers), inclusive.
(5) Section
808 (Reorganization under act of congress).
(6) Section
907 (Merger or consolidation of domestic and foreign corporations).
1320. EXEMPTION FROM CERTAIN PROVISIONS
(a) Notwithstanding
any other provision of this chapter, a foreign corporation doing business
within the territorial jurisdiction of the Nation which is authorized
under this chapter, its directors, officers and shareholders, shall
be exempt from the provisions of paragraph (e) of section 1316 (Voting
trust records), subparagraph (a)(1) of section 1317 (Liabilities of
directors and officers of foreign corporations), section 1318 (Liability
of foreign corporations for failure to disclose required information)
and subparagraph (a)(4) of section 1319 (Applicability of other provisions)
if when such provision would otherwise apply:
(1) Shares
of such corporation were listed on a national securities exchange,
or
(2) Less
than one-half of the total of its business income for the preceding
three fiscal years, or such portion thereof as the foreign corporation
was in existence, was allocable to the Nation for franchise tax purposes
under any tax law.
1/2004
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