6.20.200 Involuntary Dissolution and Liquidation

6.20.200 Involuntary Dissolution and Liquidation.

(1) Involuntary Dissolution. A corporation may be dissolved involuntarily by the Tribal Court as provided in this section.

(a) The Tribal Court may order the corporation to appear before it and show cause as to why it should not be dissolved when one or more of the following is established:

(i) The corporation procured its articles of incorporation through fraud, omission of relevant information or deception;

(ii) The corporation has continued to exceed or abuse the authority conferred upon it by law;

(iii) The corporation has failed for 30 days to appoint and maintain a registered agent or office within Samish Indian Country;

(iv) The corporation has failed for 30 days after change of its registered agent or office to file with the Finance Department a statement of such change; or

(v) The corporation is found by the Tribal Court to be in violation of this chapter or any other law of the Tribe.

(b) Dissolution under this section shall be initiated and prosecuted by the Finance Department.

(2) Jurisdiction of Samish Tribal Court to Liquidate Assets and Affairs of Corporation. The Tribal Court shall have exclusive jurisdiction to liquidate the assets and affairs of a tribal or tribally licensed corporation:

(a) Upon petition to the Tribal Council of 10 percent of the shareholders or by Tribal Council resolution if the corporation is wholly or partially owned and operated by the Tribe, if the petition or resolution establishes one or more of the following:

(i) That the directors are deadlocked in the management of the corporate affairs and shareholders are unable to break the deadlock, and that irreparable injury to the corporation is being suffered or is threatened by reason thereof;

(ii) That the acts of the directors in control of the corporation are illegal, oppressive or fraudulent;

(iii) That the shareholders are deadlocked in voting power, and 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 of their successors;

(iv) That the corporate assets are being misapplied or wasted;

(v) That the corporation has consistently failed to use accepted accounting practices in the maintenance of its books and records; or

(vi) That the corporation does or omits any act which amounts to a surrender of its corporate rights, privileges or franchises.

(b) Upon petition to the Tribal Court of a creditor, if the petition establishes one or more of the following:

(i) The claim of the creditor has been reduced to judgment and an execution thereon returned unsatisfied and it is established that the corporation is insolvent; or

(ii) The corporation has admitted in writing that the claim of the creditor is due and owing and it is established that the corporation is insolvent.

(a) Where there are grounds for issuing an order to show cause why a corporation shall not be dissolved or when the Tribal Court receives a petition for liquidation or the Tribal Council adopts a petition for liquidation, the Tribal Court shall send an order to appear and show cause why the corporation should not be dissolved or liquidated to the president and secretary of the corporation. The hearing shall be scheduled by the Tribal Court no less than 30 days from the date of the order.

(b) If the Tribal Court finds that the officers of the corporation have shown sufficient cause why the corporation should not be dissolved or liquidated, the decision of the Tribal Court shall be final.

(c) If the officers of the corporation fail to appear as ordered, or if, in the opinion of the Tribal Court, the officers have failed to show sufficient cause why the corporation should not be dissolved or liquidated, the Tribal Court may revoke the corporation’s certificate of incorporation.

(d) If the Tribal Court revokes the corporation’s certificate, it shall assume trusteeship over the corporation’s assets and liquidate its assets in accordance with this section.

(e) If prior to the revocation of the corporation’s certificate, the corporation cures all defaults complained of and pays all penalties and costs, the action shall abate.

(4) Liquidation of Corporation by the Samish Indian Nation Tribal Court. If the Tribal Court revokes a corporation’s certificate of incorporation, it shall proceed to liquidate the assets and business of a corporation as follows:

(a) The Tribal Court shall have power to issue injunctions, and to appoint a liquidating receiver with any powers and duties the trial court may direct. The Tribal Court may also take any other actions necessary to preserve the corporate assets wherever situated, and carry on the business of the corporation until final dissolution.

(b) The liquidating receiver shall give notice to all parties in interest and creditors and allow each a proper hearing with sworn statements.

(c) The liquidating receiver shall then collect the assets of the corporation wherever situated, either at public or private sale.

(d) The assets of the corporation or the proceeds resulting from a sale, conveyance or other disposition thereof shall be applied to the expenses of the liquidation and to the payment of the liabilities and obligations of the corporation according to this chapter. Any remaining assets or proceeds shall be distributed according to this chapter.

(e) The Tribal Court shall have power to allow compensation to the receiver and any attorneys in the proceeding out of the assets of the corporation or the proceeds of any sale or disposition of such assets.

(f) A receiver of a corporation appointed under the provisions of this section shall have authority to sue and defend in all courts in his own name as receiver of such corporation.

(a) The Tribal Court shall issue an order dissolving the corporation, when:

(i) The costs and expense of the liquidation have been satisfied;

(ii) All debts, obligations and liabilities have been paid and discharged; and

(iii) All of its remaining property and assets have been distributed.

In case the corporation’s property and assets are not sufficient to satisfy and discharge such costs, expenses, debts and obligations, but all the property and assets have been applied so far as they will go to their payment, the Tribal Court shall issue an order dissolving the corporation.

(b) Upon issuance of an order of dissolution, the existence of the corporation shall cease.

(6) Filing of Order of Dissolution. When the Tribal Court issues an order dissolving a corporation, it shall remit a certified copy of the order to the Finance Department. [Res. 2020-04-005 § 2, 2020.]