§ 7-1.2-1314 - Jurisdiction of court to liquidate assets and business of corporation.
SECTION 7-1.2-1314
§ 7-1.2-1314 Jurisdiction of court toliquidate assets and business of corporation. – (a) The superior court has full power to liquidate the assets and business of acorporation:
(1) In an action by a shareholder when it is establishedthat, whether or not the corporate business has been or could be operated at aprofit, dissolution would be beneficial to the shareholders because:
(i) The directors or those other individuals that may beresponsible for management pursuant to § 7-1.2-1701(a) are deadlocked inthe management of the corporate affairs and the shareholders are unable tobreak the deadlock; or
(ii) The acts of the directors or those in control of thecorporation are illegal, oppressive, or fraudulent; or
(iii) The shareholders are deadlocked in voting power, andhave failed, for a period which includes at least two (2) consecutive annualmeeting dates, to elect successors to directors whose terms have expired orwould have expired upon the election and qualification of their successors; or
(iv) The corporate assets are being misapplied or are indanger of being wasted or lost; or
(v) Two (2) or more factions of shareholders are divided andthere is such internal dissension that serious harm to the business and affairsof the corporation is threatened; or
(vi) The holders of one-half (1/2) or more of all theoutstanding shares of the corporation have voted to dissolve the corporation;
(2) In an action by a creditor:
(A) When it is established that the corporation is insolvent;or
(B) When it is established that the corporate assets arebeing misapplied or are in danger of being wasted or lost.
(ii) If it is established that the claim of a creditor hasbeen reduced to judgment and an execution on the judgment returned unsatisfiedor that a corporation has admitted, in writing, that the claim of a creditor isdue and owing, the establishment of the facts are prima facie evidence ofinsolvency.
(iii) Every petition filed by a creditor for the liquidationof the assets and business of a corporation must contain a statement as towhether the creditor is or is not an officer, director, or shareholder of thecorporation. Every petition for the liquidation of the assets and business of acorporation filed by an officer, director, or shareholder of a corporation orby a creditor who is an officer, director or shareholder, must contain, to thebest of petitioner's knowledge, information, and belief, the names andaddresses of all known creditors of any class of the corporation.
(3) When an action has been filed by the attorney general todissolve a corporation and it is established that liquidation of its businessand affairs should precede the entry of a decree of dissolution.
(b) Proceedings under subdivisions (a)(1) or (a)(2) should bebrought in the county in which the registered or principal office of thecorporation is situated.
(c) It is not necessary to make shareholders parties to anyaction or proceeding unless relief is sought against them personally.