§ 10-33-107 — Involuntary dissolution

1. A court may grant equitable relief it considers just and reasonable in the circumstances
or may dissolve a corporation and liquidate its assets and activities:
a. In a supervised voluntary dissolution under section 10-33-106.
b. In an action by a director or at least fifty members with voting rights or ten percent
of the members with voting rights, whichever is less, when it is established that:
(1) The directors or the persons having the authority otherwise vested in the
board are deadlocked in the management of the corporate affairs, the
members cannot break the deadlock, and the corporation or the parties
have not provided for a procedure to resolve the dispute;
(2) The directors or those in control of the corporation have acted fraudulently,
illegally, or in a manner unfairly prejudicial toward one or more members in
their capacities as members, directors, or officers;

(3) The members of the corporation are so divided in voting power that, for a
period that includes the time when two consecutive regular meetings were
held, they have failed to elect successors to directors whose terms have
expired or would have expired upon the election and qualification of their
successors;
(4) The corporate assets are being misapplied or wasted; or
(5) The period of duration as provided in the articles has expired and has not
been extended as provided in section 10-33-118.
c. In an action by a creditor when:
(1) The claim of the creditor has been reduced to judgment and an execution on
it has been returned unsatisfied; or
(2) The corporation has admitted in writing that the claim of the creditor is due
and owing and it is established that the corporation cannot pay its debts in
the ordinary course of its activities.
d. In an action by the attorney general when it is established that:
(1) The articles and certificate of incorporation were obtained through fraud;
(2) The corporation should not have been formed under this chapter;
(3) The corporation failed to comply with the requirements of sections 10-33-02
through 10-33-19 essential to incorporation under or election to become
governed by this chapter;
(4) The corporation has flagrantly violated a provision of this chapter, has
violated a provision of this chapter more than once, or has violated more
than one provision of this chapter;
(5) The corporation has engaged in an unauthorized act, contract, conveyance,
or transfer or has exceeded its powers;
(6) The corporation has acted, or failed to act, in a manner that constitutes
surrender or abandonment of the corporate purpose, franchise, privileges,
or enterprise;
(7) The corporation has liabilities and obligations exceeding the corporate
assets;
(8) The period of corporate existence has ended without extension;
(9) The corporation has failed for a period of ninety days to pay fees, charges,
or penalties required by this chapter;
(10) The corporation has failed for a period of thirty days:
(a) To appoint and maintain a registered agent in this state as provided in
chapter 10-01.1; or
(b) After changing its registered office, to file with the secretary of state a
statement of the change as provided in chapter 10-01.1;
(11) The corporation has answered falsely or failed to answer a reasonable
written interrogatory from the secretary of state or the attorney general to
the corporation, its officers, or directors;
(12) The corporation has solicited property and has failed to use it for the
purpose solicited; or
(13) The corporation has fraudulently used or solicited property.
e. An action may not be commenced under subdivision d until thirty days after
notice to the corporation by the attorney general of the reason for the filing of the
action. If the reason for filing the action is an act that the corporation has done, or
omitted to do, and the act or omission may be corrected by an amendment of the
articles or bylaws or by performance of or abstention from the act, the attorney
general shall give the corporation thirty additional days in which to effect the
correction before filing the action.
2. In determining whether to order equitable relief or dissolution under this section, the
court shall consider the financial condition of the corporation but may not refuse to
order equitable relief or dissolution solely on the ground that the corporation is solvent.
3. In deciding whether to order dissolution, the court shall consider whether lesser relief
suggested by one or more parties, such as any form of equitable relief or a partial

liquidation, would be adequate to permanently relieve the circumstances established
under subdivision b, c, or d of subsection 1. Lesser relief may be ordered if it would be
appropriate under the facts and circumstances of the case.
4. If the court finds that a party to a proceeding brought under this section has acted
arbitrarily, vexatiously, or otherwise not in good faith, it may award reasonable
expenses, including attorney's fees and disbursements, to any of the other parties.
5. Proceedings under this section must be brought in a court within the county in which
the principal executive office of the corporation is located. It is not necessary to make
members parties to the action or proceeding unless relief is sought against them
personally.