35-2-728. Grounds for judicial dissolution. (1) The district court may dissolve a corporation:
(a) in a proceeding by the attorney general if it is established that:
(i) the corporation obtained its articles of incorporation through fraud;
(ii) the corporation has continued to exceed or abuse the authority conferred upon it by law;
(iii) the corporation is a public benefit corporation and the corporate assets are being misapplied or wasted; or
(iv) the corporation is a public benefit corporation and is no longer able to carry out its purposes;
(b) in a proceeding by 50 members or members holding 5% of the voting power, whichever is less, or by a director or any person specified in the articles, except as provided in the articles or bylaws of a religious corporation, if it is established that:
(i) the directors are deadlocked in the management of the corporate affairs and the members, if any, are unable to breach the deadlock;
(ii) the directors or those in control of the corporation have acted, are acting, or will act in a manner that is illegal, oppressive, or fraudulent;
(iii) the members are deadlocked in voting power and have failed, for a period that includes at least two consecutive annual meeting dates, to elect successors to directors whose terms have or would otherwise have expired;
(iv) the corporate assets are being misapplied or wasted; or
(v) the corporation is a public benefit corporation or religious corporation and is no longer able to carry out its purposes;
(c) in a proceeding by a creditor if it is established that:
(i) the creditor's claim has been reduced to judgment, the execution on the judgment returned unsatisfied, and the corporation is insolvent; or
(ii) the corporation has admitted in writing that the creditor's claim is due and owing and the corporation is insolvent; or
(d) in a proceeding by the corporation to have its voluntary dissolution continued under court supervision.
(2) Prior to dissolving a corporation, the court shall consider whether:
(a) there are reasonable alternatives to dissolution;
(b) dissolution is in the public interest, if the corporation is a public benefit corporation; and
(c) dissolution is the best way of protecting the interests of members if the corporation is a mutual benefit corporation.
History: En. Sec. 142, Ch. 411, L. 1991.