Chapter 04-274

2004 -- H 7945 SUBSTITUTE A AS AMENDED

Enacted 07/02/04

 

A N A C T

RELATING TO CORPORATIONS, ASSOCIATIONS, AND PARTNERSHIPS

     

     

     Introduced By: Representatives Anguilla, Williamson, Kilmartin, Schadone, and Jacquard

     Date Introduced: February 12, 2004

 

 

It is enacted by the General Assembly as follows:

 

     SECTION 1. Chapter 7-1.1 of the General Laws entitled "Business Corporations" is

hereby repealed in its entirety.

     CHAPTER 7-1.1

Business Corporations

     7-1.1-1. Short title. -- This chapter shall be known and may be cited as the "Rhode Island

Business Corporation Act."

     7-1.1-2. Definitions. -- As used in this chapter, unless the context otherwise requires, the

term:

      (1) "Corporation" or "domestic corporation" means a corporation for profit subject to the

provisions of this chapter, except a foreign corporation.

      (2) "Foreign corporation" means a corporation for profit organized under laws other than

the laws of this state for a purpose or purposes for which a corporation may be organized under

this chapter.

      (3) "Articles of incorporation" means the original or restated articles of incorporation or

articles of consolidation and all of their amendments including agreements of merger.

      (4) "Shares" means the units into which the proprietary interests in a corporation are

divided.

      (5) "Subscriber" means one who subscribes for shares in a corporation, whether before or

after incorporation.

      (6) (i) "Shareholder" means one who is a holder of record of shares in a corporation. If

the articles of incorporation or the bylaws so provide, the board of directors may adopt by

resolution a procedure under which a shareholder of the corporation certifies in writing to the

corporation that all or a portion of the shares registered in the name of the shareholder are held for

the account of a specified person or persons. The resolution shall set forth:

      (A) The classification of shareholder who may certify;

      (B) The purpose or purposes for which the certification may be made;

      (C) The form of certification and information it is to contain;

      (D) If the certification is with respect to a record date or closing of the stock transfer

books within which the certification must be received by the corporation; and

      (E) Any other provisions as to the procedure that are deemed necessary or desirable.

      (ii) Upon receipt by the corporation of a certification complying with the procedure, the

persons specified in the certification are deemed, for the purpose or purposes set forth in the

certification, to be the holders of record of the number of shares specified in place of the

shareholder making the certification.

      (7) "Authorized shares" means the shares of all classes which the corporation is

authorized to issue.

      (8) "Treasury shares" means shares of a corporation which have been issued, have been

subsequently acquired by and belong to the corporation, and have not, either by reason of the

acquisition or subsequently, been cancelled or restored to the status of authorized but unissued

shares. Treasury shares are deemed to be "issued" shares, but not "outstanding" shares.

      (9) "Net assets" means the amount by which the total assets of a corporation exceed the

total debts of the corporation.

      (10) (i) "Stated capital" means, at any particular time, the sum of:

      (A) The par value of all shares of the corporation having a par value that have been

issued, or, if the shares have a preference in the assets of the corporation in the event of

involuntary liquidation which is greater than the par value, then to the extent of the preference;

      (B) The amount of the consideration received by the corporation for all shares of the

corporation without par value that have been issued, except the part of the consideration for the

shares that may have been allocated to capital surplus in a manner permitted by law; and

      (C) The amounts not included in subdivisions (10)(i) and (10)(ii) that have been

transferred to stated capital of the corporation, whether upon the issue of shares as a share

dividend or otherwise, minus all reductions from the sum that have been effected in a manner

permitted by law.

      (ii) Irrespective of the manner of designation of the stated capital by the laws under

which a foreign corporation is organized, the stated capital of a foreign corporation is determined

on the same basis and in the same manner as the stated capital of a domestic corporation, for the

purpose of computing fees, franchise taxes, and other charges imposed by this chapter.

      (11) "Surplus" means the excess of the net assets of a corporation over its stated capital.

      (12) "Earned surplus" means the portion of the surplus of a corporation equal to the

balance of its net profits, income, gains, and losses from the date of incorporation, or from the

latest date when a deficit was eliminated by an application of its capital surplus or stated capital

or otherwise, after deducting subsequent distributions to shareholders and transfers to stated

capital and capital surplus to the extent the distributions and transfers are made out of earned

surplus. Earned surplus also includes any portion of surplus allocated to earned surplus in

mergers, consolidations, or acquisitions of all or substantially all of the outstanding shares or of

the property and assets of another corporation, domestic or foreign.

      (13) "Capital surplus" means the entire surplus of a corporation other than its earned

surplus. Capital surplus, but not earned surplus, may include surplus arising from the revaluation

of assets, including good will, if made in good faith upon demonstrably adequate bases of

valuation.

      (14) "Insolvent" means the inability of a corporation to pay its debts as they become due

in the usual course of its business.

      (15) "Employee" includes officers but not directors. A director may accept duties which

also make him or her an employee.

     7-1.1-3. Purposes. -- Corporations may be organized under this chapter for any lawful

purpose or purposes, except for the purpose of carrying on within this state the business of a

bank, savings bank, trust company, building and loan association, loan and investment company,

safe deposit company, railroad, electric railroad or street railway company, telegraph or telephone

company, gas or electric light, heat or power company, canal, aqueduct, or water company,

turnpike company, or any corporation which now has or may subsequently have the right to take

or condemn land or other property within this state under the power of eminent domain, or to

exercise or acquire franchises in streets or highways of this state; provided, however, that

corporations organized for any of the purposes specified in chapter 5.1 of this title shall be

organized under the provisions of that chapter.

     7-1.1-4. General powers. -- Each corporation shall have power to:

      (1) Have perpetual succession by its corporate name unless a limited period of duration

is stated in its articles of incorporation.

      (2) Sue and be sued, complain and defend, in its corporate name.

      (3) Have a corporate seal which may be altered at pleasure, and to use the seal by

causing it, or a facsimile of it, to be impressed or affixed or reproduced in any other manner.

      (4) Purchase, take, receive, lease, or otherwise acquire, own, hold, improve, use, and

otherwise deal in and with, real or personal property, or any interest in that property, wherever

situated.

      (5) Sell, convey, mortgage, pledge, lease, exchange, transfer, and otherwise dispose of

all or any part of its property and assets.

      (6) Lend money and use its credit to assist its employees.

      (7) Purchase, take, receive, subscribe for, or otherwise acquire, own, hold, vote, use,

employ, sell, mortgage, lend, pledge, or otherwise dispose of, and otherwise use and deal in and

with, shares or other interests in, or obligations of, other domestic or foreign corporations,

associations, partnerships or individuals, or direct or indirect obligations of the United States or of

any other government, state, territory, governmental district or municipality or of any of their

instrumentalities.

      (8) Make contracts and guarantees and incur liabilities, borrow money at the rate of

interest that the corporation may determine, issue its notes, bonds, and other obligations, and

secure any of its obligations by mortgage or pledge of all or any of its property, franchises, and

income.

      (9) Lend money for its corporate purposes, invest and reinvest its funds, and take and

hold real and personal property as security for the payment of the funds loaned or invested.

      (10) Conduct its business, carry on its operations, and have offices and exercise the

powers granted by this chapter, within or without this state.

      (11) Elect or appoint officers and agents of the corporation, and define their duties and

fix their compensation.

      (12) Make and alter bylaws, not inconsistent with its articles of incorporation or with the

laws of this state, for the administration and regulation of the affairs of the corporation.

      (13) Make donations for the public welfare or for charitable, scientific, or educational

purposes.

      (14) Transact any lawful business which the board of directors finds will aid

governmental authority.

      (15) Pay pensions and establish pension plans, pension trusts, profit sharing plans, stock

bonus plans, stock option plans, and other incentive plans for any or all of its directors, officers,

and employees.

      (16) Provide insurance for its benefit on the life of any of its directors, officers, or

employees, or on the life of any stockholder for the purpose of acquiring at his or her death shares

of its stock owned by the stockholder.

      (17) Be a promoter, partner, member, associate, or manager of any partnership, joint

venture, trust, or other enterprise.

      (18) Have and exercise all powers necessary or convenient to effect its purposes.

     7-1.1-4.1. Indemnification. -- (a) As used in this section:

      (1) "Director" means any person who is or was a director of the corporation and any

person who, while a director of the corporation, is or was serving at the request of the corporation

as a director, officer, partner, trustee, employee, or agent of another foreign or domestic

corporation, partnership, joint venture, trust, other enterprise, or employee benefit plan.

      (2) (i) "Corporation" includes (A) any domestic or foreign corporation, profit or

nonprofit, and (B) any domestic or foreign predecessor entity of the corporation in a merger,

consolidation, or other transaction in which the predecessor's existence ceased upon

consummation of the transaction.

      (ii) "Corporation" also includes any of the classes of quasi public corporations with

purposes enumerated as exceptions in section 7-1.1-3 to the extent that the corporations are not

subject to other provisions of the general laws or special acts authorizing indemnification of their

directors and officers.

      (3) "Expenses" include attorneys' fees.

      (4) "Official capacity" means:

      (i) When used with respect to a director, the office of director in the corporation; and

      (ii) When used with respect to a person other than a director, as contemplated in

subsection (a)(1), the elective or appointive office in the corporation held by the officer or the

employment or agency relationship undertaken by the employee or agent on behalf of the

corporation, but in each case does not include service for any other foreign or domestic

corporation or any partnership, joint venture, trust, other enterprise, or employee benefit plan.

      (5) "Party" includes a person who was, is, or is threatened to be made, a named

defendant or respondent in a proceeding.

      (6) "Proceeding" means any threatened, pending or completed action, suit, or

proceeding, whether civil, criminal, administrative, or investigative.

      (b) (1) A corporation has power to indemnify any person made a party to any proceeding

by reason of the fact that he or she is or was a director if:

      (i) He or she conducted him or herself in good faith; and

      (ii) He or she reasonably believed,

      (A) In the case of conduct in his or her official capacity with the corporation, that his or

her conduct was in its best interests, and

      (B) In all other cases, that his or her conduct was at least not opposed to its best interests;

and

      (iii) In the case of any criminal proceeding, he or she had no reasonable cause to believe

his or her conduct was unlawful.

      (2) Indemnification may be made against judgments, penalties, fines, settlements, and

reasonable expenses actually incurred by the person in connection with the proceeding; except

that if the proceeding was by or in the right of the corporation, indemnification may be made only

against the reasonable expenses and shall not be made in respect of any proceeding in which the

person has been adjudged to be liable to the corporation. The termination of any proceeding by

judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent, shall

not, of itself, be determinative that the person did not meet the requisite standard of conduct set

forth in this subsection.

      (c) A director shall not be indemnified under subsection (b) in respect of any proceeding

charging improper personal benefit to him or her, whether or not involving action in his or her

official capacity, in which he or she has been adjudged to be liable on the basis that personal

benefit was improperly received by the director.

      (d) (1) Unless limited by the articles of incorporation:

      (i) A director who has been wholly successful, on the merits or otherwise, in the defense

of any proceeding referred to in subsection (b) is indemnified against reasonable expenses

incurred by him or her in connection with the proceeding; and

      (ii) A court of appropriate jurisdiction, upon application of a director and any notice that

the court requires, has authority to order indemnification in the following circumstances:

      (A) If it determines a director is entitled to reimbursement under subdivision (d)(1)(A),

the court shall order indemnification, in which case the director is also entitled to recover the

expenses of securing the reimbursement; or

      (B) If it determines that the director is fairly and reasonably entitled to indemnification

in view of all the relevant circumstances, whether or not he or she has met the standard of

conduct set forth in subsection (b) or has been adjudged liable in the circumstances described in

subsection (c), the court may order such indemnification as the court shall deem proper, except

that indemnification with respect to any proceeding by or in the right of the corporation or in

which liability has been adjudged in the circumstances described in subsection (c) are limited to

expenses.

      (2) A court of appropriate jurisdiction may be the same court in which the proceeding

involving the director's liability took place.

      (e) (1) No indemnification under subsection (b) shall be made by the corporation unless

authorized in the specific case after a determination has been made that indemnification of the

director is permissible in the circumstances because he or she has met the standard of conduct set

forth in subsection (b). The determination shall be made:

      (i) By the board of directors by a majority vote of a quorum consisting of directors not at

the time parties to the proceeding; or

      (ii) If such a quorum cannot be obtained, then by a majority vote of a committee of the

board, duly designated to act in the matter by a majority vote of the full board (in which

designation directors who are parties may participate), consisting solely of two (2) or more

directors not at the time parties to the proceeding; or

      (iii) By special legal counsel, selected by the board of directors or a committee of the

board by vote as set forth in subsection (e)(1)(i) or (e)(1)(ii), or, if the requisite quorum of the full

board cannot be obtained for the vote and the committee cannot be established, by a majority vote

of the full board (in which selection directors who are parties may participate); or

      (iv) By the shareholders.

      (2) Authorization of indemnification and determination as to reasonableness of expenses

shall be made in the same manner as the determination that indemnification is permissible, except

that if the determination that indemnification is permissible is made by special legal counsel,

authorization of indemnification and determination as to reasonableness of expenses shall be

made in a manner specified in subsection (e)(1)(iii) for the selection of the counsel. Shares held

by directors who are parties to the proceeding shall not be voted on the subject matter under this

subsection.

      (f) Reasonable expenses incurred by a director who is a party to a proceeding may be

paid or reimbursed by the corporation in advance of the final disposition of the proceeding upon

receipt by the corporation of:

      (1) A written affirmation by the director of his or her good faith belief that he or she has

met the standard of conduct necessary for indemnification by the corporation as authorized in this

section, and

      (2) A written undertaking by or on behalf of the director to repay the amount if it is

ultimately determined that he or she has not met that standard of conduct, and after a

determination that the facts then known to those making the determination would not preclude

indemnification under this section. The undertaking required by this subdivision is an unlimited

general obligation of the director but need not be secured and may be accepted without reference

to financial ability to make repayment. Determinations and authorizations of payments under this

subsection shall be made in the manner specified in subsection (e).

      (g) The indemnification provided by this section is not deemed exclusive of any other

rights to which those seeking indemnification are entitled under any bylaw, agreement, vote of

stockholders or disinterested directors or otherwise, both as to action in his or her official capacity

and as to action in another capacity while holding office, and shall continue as to a person who

has ceased to be a director, officer, partner, trustee, employee, or agent and shall inure to the

benefit of the heirs, executors, and administrators of a person. Nothing contained in this section

limits the corporation's power to pay or reimburse expenses incurred by a director in connection

with his or her appearance as a witness in a proceeding at a time when he or she has not been

made a named defendant or respondent in the proceeding.

      (h) For purposes of this section, the corporation is deemed to have requested a director to

serve an employee benefit plan whenever the performance by a director of his or her duties to the

corporation also imposes duties on, or otherwise involves services by, him or her to the plan or

participants or beneficiaries of the plan; excise taxes assessed on a director with respect to an

employee benefit plan pursuant to applicable law are deemed "fines"; and action taken or omitted

by him or her with respect to an employee benefit plan in the performance of his or her duties for

a purpose reasonably believed by him or her to be in the interest of the participants and

beneficiaries of the plan is deemed to be for a purpose which is not opposed to the best interests

of the corporation.

      (i) Unless limited by the articles of incorporation:

      (1) An officer of the corporation is indemnified as and to the same extent provided in

subsection (d) for a director, and is entitled to the same extent as a director to seek

indemnification pursuant to the provisions of subsection (d);

      (2) A corporation has the power to indemnify and to advance expenses to an officer,

employee, or agent of the corporation to the same extent that it may indemnify and advance

expenses to directors pursuant to this section; and

      (3) A corporation, in addition, has the power to indemnify and to advance expenses to an

officer, employee, or agent who is not a director to a further extent, consistent with law, that is

provided by its articles of incorporation, bylaws, general or specific action of its board of

directors, or contract.

      (j) A corporation has power to purchase and maintain insurance on behalf of any person

who is or was a director, officer, employee, or agent of the corporation, or who, while a director,

officer, employee, or agent of the corporation, is or was serving at the request of the corporation

as a director, officer, partner, trustee, employee, or agent of another foreign or domestic

corporation, partnership, joint venture, trust, other enterprise, or employee benefit plan, against

any liability asserted against him or her and incurred by him or her in any corporate capacity or

arising out of his or her status as a director, officer, employee, or agent of the corporation,

whether or not the corporation would have the power to indemnify him or her against the liability

under the provisions of this section.

      (k) Any indemnification of, or advance of expenses to, a director in accordance with this

section, if arising out of a proceeding by or in the right of the corporation, shall be reported in

writing to the shareholders with or before the notice of the next shareholders' meeting.

     7-1.1-4.2. Guarantee authorized by shareholders. -- Each corporation has the power to

make guarantees, although not in furtherance of its corporate purposes, when authorized at a

meeting of shareholders by the affirmative vote of the holders of a majority of the shares of the

corporation entitled to vote on guarantees, or a greater percentage that is provided in the articles

of incorporation or bylaws. If authorized by a like vote, a corporation has the power to mortgage,

pledge, or give a security interest in all or any of its property, franchises, and income to secure a

guarantee or to secure obligations other than its own.

     7-1.1-5. Right of corporation to acquire and dispose of its own shares. -- (a) A

corporation has the right to purchase, take, receive, or otherwise acquire, hold, own, pledge,

transfer, or otherwise dispose of its own shares, but purchases of its own shares, whether direct or

indirect, shall be made only to the extent of its unreserved and unrestricted earned surplus

available for purchases of its own shares, or, if it has no earned surplus, to the extent of its

unreserved and unrestricted capital surplus pursuant to the provisions of section 7-1.1-41.

      (b) Until disposition or cancellation of treasury shares, the cost of the shares is treated as

a deduction from the total of the stated capital and surplus of the corporation: and the earned

surplus or capital surplus used as the measure of the corporation's right to purchase its own shares

is restricted so long as the shares are held as treasury shares. Upon the disposition or cancellation

of any treasury shares, the restriction on earned surplus or capital surplus is removed pro tanto,

but the earned surplus or capital surplus previously restricted is reduced by the amount of any

excess of the cost of the shares over the proceeds (if any) received upon their disposition or

cancellation.

      (c) Notwithstanding the foregoing limitations, a corporation may purchase or otherwise

acquire its own shares out of its capital surplus, or, if it has no capital surplus, out of its stated

capital (but in that event at a price not exceeding the stated capital attributable to the shares

purchased), for the purpose of:

      (1) Eliminating fractional shares.

      (2) Collecting or compromising indebtedness to the corporation.

      (3) Satisfying the claim of dissenting shareholders entitled to payment for their shares

under the provisions of this chapter.

      (4) Effecting, subject to the other provisions of this chapter, the retirement of its

redeemable shares by redemption or by purchase at an amount not to exceed the consideration

payable upon redemption.

      (d) The acquisition by a corporation of its own shares pursuant to a conversion or

exchange of shares shall not be treated as a purchase of shares subject to the provisions of this

section.

      (e) An open end investment company, registered as such under the Federal Investment

Company Act of 1940 (15 U.S.C. sections 80a-1 -- 80a-64), as amended, may, if its articles of

incorporation so provide, purchase its own shares out of any unrestricted surplus or out of stated

capital.

      (f) No purchase of or payment for its own shares shall be made at a time when the

corporation is insolvent or when the purchase or payment would make it insolvent.

     7-1.1-6. Defense of ultra vires. -- No act of a corporation and no conveyance or transfer

of real or personal property to or by a corporation is invalid because the corporation was without

capacity or power to do the act or to make or receive the conveyance or transfer, but the lack of

capacity or power may be asserted:

      (1) In a proceeding by a shareholder against the corporation to enjoin the doing of any

act or the transfer of real or personal property by or to the corporation. If the unauthorized act or

transfer sought to be enjoined is being, or is to be, performed or made pursuant to a contract to

which the corporation is a party, the court may, if all of the parties to the contract are parties to

the proceeding and if it deems the same to be equitable, set aside and enjoin the performance of

the contract, and in so doing may allow to the corporation or to the other parties to the contract, as

the case may be, compensation for the loss or damage sustained by either of them which may

result from the action of the court in setting aside and enjoining the performance of the contract,

but anticipated profits to be derived from the performance of the contract shall not be awarded by

the court as a loss or damage sustained.

      (2) In a proceeding by the corporation, whether acting directly or through a receiver,

trustee, or other legal representative, or through shareholders in a representative suit, against the

incumbent or former officers or directors of the corporation.

      (3) In a proceeding by the attorney general, as provided in this chapter, to dissolve the

corporation, or in a proceeding by the attorney general to enjoin the corporation from the

transaction of unauthorized business.

     7-1.1-7. Corporate name. -- (a) The corporate name:

      (1) Shall contain the word "corporation," "company," "incorporated," or "limited," or

shall contain an abbreviation of one of the words.

      (2) Shall not contain any word or phrase which indicates or implies that it is organized

for any purpose other than one or more of the purposes contained in its articles of incorporation.

      (3) Shall not be the same as, or deceptively similar to, the name of any domestic

corporation, whether for profit or not for profit, or limited partnership existing under the laws of

this state or any foreign corporation, whether for profit or not for profit, or limited partnership

authorized to transact business in this state, or domestic or foreign limited liability company or a

name the exclusive right to which is, at the time filed, reserved or registered in the manner

provided in this chapter, or the name of a corporation or a limited partnership which has in effect

a registration of its corporate or limited partnership name as provided in this title, subject to the

following:

      (i) This provision does not apply if the applicant files with the secretary of state either of

the following:

      (A) The written consent of the other corporation, limited partnership, limited liability

company or holder of a filed, reserved or registered name to use that name or deceptively similar

name, and one or more words are added to make the name distinguishable from the other name;

or

      (B) A certified copy of a final decree of a court of competent jurisdiction establishing the

prior right of the applicant to the use of the name in this state; and

      (ii) The name may be the same as, or deceptively similar to, the name of a corporation or

other association the certificate of incorporation or organization of which has been revoked by the

secretary of state as permitted by law and the revocation has not been withdrawn within one year

from the date of the revocation.

      (b) A corporation with which another corporation, domestic or foreign, is merged, or

which is formed by the reorganization or consolidation of one or more domestic or foreign

corporations or upon a sale, lease, or other disposition to, or exchange with, a domestic

corporation of all or substantially all the assets of another corporation, domestic or foreign,

including its name, may have the same name as that used in this state by any of the corporations if

at the time the other corporation was organized under the laws of, or is authorized to transact

business in, this state.

     7-1.1-7.1. Fictitious business name. -- (a) Any corporation organized and existing under

the laws of any state or territory of the United States may transact business in this state under a

fictitious name, provided that it files a fictitious business name statement in accordance with this

section prior to the time it commences to transact the business under the fictitious name.

      (b) The fictitious business name statement shall be filed in duplicate with the secretary of

state on forms to be furnished by the secretary of state and shall be executed by an officer of the

corporation and shall state:

      (1) The fictitious business name to be used;

      (2) The name of the applicant corporation and the state or territory under the laws of

which it is incorporated, the date of its incorporation, and a brief statement of the business in

which it is engaged; and

      (3) The address of its registered office within the state.

      (c) The fictitious business name statement expires upon the filing of the statement of

abandonment of use of a fictitious business name registered in accordance with this section or

upon the dissolution of the applicant corporation.

      (d) The statement of abandonment of use of a fictitious business name under this section

may be filed in duplicate with the secretary of state on forms furnished by the secretary of state

and shall be executed by an officer of the corporation and shall state:

      (1) The fictitious business name being abandoned;

      (2) The date on which the original fictitious business name statement being abandoned

was filed;

      (3) The name of the applicant corporation and the state or territory under the laws of

which it is incorporated; and

      (4) The address of its registered office within the state.

      (e) No domestic or foreign corporation transacting business under a fictitious business

name contrary to the provisions of this section, or its assignee, may maintain any action upon or

on account of any contract made, or transaction had, in the fictitious business name in any court

of this state until a fictitious business name statement has been filed in accordance with this

section.

      (f) No corporation may be permitted to transact business under a fictitious business name

pursuant to this section which is the same as or deceptively similar to the name of any domestic

corporation, any domestic limited partnership or any domestic limited liability company existing

under the laws of this state, or the name of any foreign corporation, foreign limited partnership or

foreign limited liability company authorized to transact business in the state, or any corporate

name filed, reserved or registered under this title.

      (g) A filing fee of fifty dollars ($50.00) is collected by the secretary of state for each

statement filed.

     7-1.1-8. Reserved name. -- (a) The exclusive right to the use of a corporate name may be

reserved by:

      (1) Any person intending to organize a corporation under this chapter.

      (2) Any domestic corporation intending to change its name.

      (3) Any foreign corporation intending to make application for a certificate of authority to

transact business in this state.

      (4) Any foreign corporation authorized to transact business in this state and intending to

change its name.

      (5) Any person intending to organize a foreign corporation and intending to have the

corporation make application for a certificate of authority to transact business in this state.

      (b) The reservation is made by filing with the secretary of state an application to reserve

a specified corporate name, executed by the applicant. If the secretary of state finds that the name

is available for corporate use, he or she shall reserve the name for the exclusive use of the

applicant for a period of one hundred and twenty (120) days.

      (c) The right to the exclusive use of a specified corporate name so reserved may be

transferred to any other person or corporation by filing in the office of the secretary of state a

notice of the transfer, executed by the applicant for whom the name was reserved, and specifying

the name and address of the transferee.

     7-1.1-9. Registered name. -- (a) Any corporation organized and existing under the laws

of any state or territory of the United States may register its corporate name under this chapter,

provided its corporate name is not the same as or deceptively similar to, the name of any domestic

corporation, limited partnership or limited liability company existing under the laws of this state,

or the name of any foreign corporation, limited partnership or limited liability company

authorized to transact business in this state, or any corporate name reserved, filed or registered

under this title.

      (b) The registration is made by:

      (1) Filing with the secretary of state:

      (i) An application for registration executed by an officer of the corporation, stating the

name of the corporation, the state or territory under the laws of which it is incorporated, the date

of its incorporation, a statement that it is carrying on or doing business, and a brief statement of

the business in which it is engaged; and

      (ii) A certificate stating that the corporation is in good standing under the laws of the

state or territory wherein it is organized, executed by the secretary of state of the state or territory

or by any other official that may have custody of the records pertaining to corporations; and

      (2) Paying to the secretary of state a registration fee of fifty dollars ($50.00).

      (c) The registration is effective for a period of one year.

     7-1.1-10. Renewal of registered name. -- A corporation, which has in effect a

registration of its corporate name, may renew the registration from year to year by annually filing

an application for renewal stating the facts required to be stated in an original application for

registration and a certificate of good standing as required for the original registration and by

paying a fee of fifty dollars ($50.00). A renewal application shall be filed prior to the expiration

of the one year period from the filing of an original application for registration or its last renewal

and extends the registration for the following year.

     7-1.1-11. Registered office and registered agent -- Designation of registered agent

without authority. -- (a) Each corporation shall have and continuously maintain in this state:

      (1) A registered office, which may be, but need not be, the same as its place of business.

      (2) A registered agent, who may be either an individual resident in this state whose

business office is identical with the registered office, or a domestic corporation, or a foreign

corporation authorized to transact business in this state, having a business office identical with the

registered office; provided, however, that in the case where the registered agent of a corporation

is an attorney, the business address of the agent need not be identical with the registered office,

but may be the usual business address of the attorney.

      (b) Any incorporator, officer, agent, or servant of a corporation, who designates a

registered agent for that corporation without the registered agent's authority, is guilty of a

misdemeanor and shall, upon conviction, be punished by a fine of not more than one thousand

dollars ($1,000) or by imprisonment of not more than one year, or both.

     7-1.1-12. Change of registered office or registered agent. -- (a) A corporation may

change its registered office or change its registered agent, or both, upon filing in the office of the

secretary of state a statement stating:

      (1) The name of the corporation.

      (2) The address of its then registered office.

      (3) If the address of its registered office has changed, the new address of the registered

office.

      (4) The name of its then registered agent.

      (5) If its registered agent has changed, the name of its successor registered agent.

      (6) The address of its registered office and the address of the business office of its

registered agent, as changed.

      (7) That the change was authorized by resolution duly adopted by its board of directors.

      (b) The statement shall be executed by the corporation by its president or a vice

president, and verified by him or her, and delivered to the secretary of state. If the secretary of

state finds that the statement conforms to the provisions of this chapter, the secretary shall file the

statement in his or her office, and upon that filing or upon a later date not more than thirty (30)

days after the filing, as is set forth in the statement, the change of address of the registered office,

or the appointment of a new registered agent, or both, as the case may be, shall become effective.

      (c) Any registered agent of a corporation may resign as an agent upon filing a written

notice of the resignation, executed in duplicate, with the secretary of state, who shall immediately

mail a copy of the resignation to the corporation at its registered office. The appointment of the

agent terminates upon the expiration of thirty (30) days after receipt of the notice by the secretary

of state.

      (d) If a registered agent changes his or her or its business address to another place within

the state, he or she or it may change the address and the address of the registered office of any

corporations of which he or she or it is a registered agent by filing a statement as required above,

except that it need be signed only by the registered agent and need not be responsive to

subsection (a)(5) or (a)(7) and must recite that a copy of the statement has been mailed to each

corporation.

     7-1.1-13. Service of process on corporation. -- (a) The registered agent appointed by a

corporation is an agent of the corporation upon whom any process, notice, or demand required or

permitted by law to be served upon the corporation may be served.

      (b) Whenever a corporation fails to appoint or maintain a registered agent in this state, or

whenever its registered agent cannot with reasonable diligence be found at the registered office,

then the secretary of state is an agent of the corporation upon whom any process, notice, or

demand may be served. Service on the secretary of state of any process, notice, or demand is

made by delivering to and leaving with him or her or with any clerk having charge of the

corporation department of his or her office, duplicate copies of the process, notice, or demand. In

the event any process, notice, or demand is served on the secretary of state, he or she shall

immediately forward one of the copies by certified mail, addressed to the corporation at its

registered office. Any service upon the secretary of state is returnable in not less than thirty (30)

days.

      (c) The secretary of state shall keep a record of all processes, notices, and demands

served upon him or her under this section, and shall record in the record the time of service and

his or her action with reference to these.

      (d) Nothing contained in these provisions limits or affects the right to serve any process,

notice, or demand required or permitted by law to be served upon a corporation in any other

manner now or subsequently permitted by law.

     7-1.1-14. Authorized shares. -- (a) Each corporation has power to create and issue the

number of shares stated in its articles of incorporation. The shares may be divided into one or

more classes, any or all of which classes may consist of shares with par value or shares without

par value, with the designations, preferences, limitations, and relative rights that are stated in the

articles of incorporation. To the extent not inconsistent with the provisions of this chapter, the

articles of incorporation may limit or deny the voting rights of any class, or provide special voting

rights for the shares of any class, including the power to elect one or more directors, or contain

restrictions on transferability of ownership designed to permit a corporation to qualify as: (1) a

real estate investment trust under the provisions of the Internal Revenue Code of 1986 [26 U.S.C.

section 1 et seq.] or regulations adopted pursuant to the Internal Revenue Code; or (2) an

investment company under the Investment Company Act of 1940 [15 U.S.C. section 80a-1 et

seq.] or regulations adopted pursuant to the Investment Company Act.

      (b) Without limiting the authority contained in these provisions, a corporation, when

provided for in its articles of incorporation, may issue shares of preferred or special classes:

      (1) Subject to the right of the corporation to redeem any of the shares for the

consideration fixed by the articles of incorporation for the redemption of the shares.

      (2) Entitling the holders of the shares to cumulative, noncumulative, or partially

cumulative dividends.

      (3) Having preference over any other class or classes of shares as to the payment of

dividends.

      (4) Having preference in the assets of the corporation over any other class or classes of

shares upon the voluntary or involuntary liquidation of the corporation.

      (5) Convertible into shares of any other class or into shares of any series of the same or

any other class, except a class having prior or superior rights and preferences as to dividends or

distribution of assets upon liquidation, but no shares, whether with or without par value, shall be

converted into shares with par value unless that part of the stated capital of the corporation

represented by the shares to be converted is, at the time of conversion, at least equal to the

aggregate par value of the shares into which the shares are to be converted.

      (c) Notwithstanding the provisions of subsection (a) of this section, the board of

directors of a corporation that is registered or intends to register as an open-end company under

the Investment Company Act of 1940 [15 U.S.C. section 80a-1 et seq.] after the registration as an

open-end company takes effect, may increase or decrease the aggregate number of shares of stock

or the number of shares of stock of any class that the corporation has authority to issue unless a

provision has been included in the charter of the corporation after July 1, 2001, prohibiting that

action by the board of directors to increase or decrease the aggregate number of shares of stock or

the number of shares of stock of any class that the corporation has authority to issue.

     7-1.1-15. Issuance of shares of preferred or special classes in series. -- (a) If the

articles of incorporation so provide, the shares of any preferred or special class may be divided

into and issued in series, with variations in relative rights and preferences, including variations in

voting rights, if any, and designations, preferences, and relative, participating, optional or other

special rights and qualifications, limitations, and restrictions on the shares, as may be desired. If

the articles of incorporation expressly vest authority in the board of directors, then, to the extent

that the articles of incorporation have not established series and fixed and determined the

variations in the relative rights and preferences as between the series, the board of directors has

authority to divide any or all of the classes into series and, within the limitations, if any, stated in

the articles of incorporation, to fix and determine the relative rights and preferences of the shares

of any series established.

      (b) The holders of preferred or special stock of any class or of any series of that stock are

entitled to receive dividends at the rates, on the conditions and at the times that are stated and

expressed in the articles of incorporation, or in any amendment of the articles, or in the vote or

votes providing for the issue of the stock adopted by the board of directors as previously

provided, payable in preference to, or in relation to, the dividends, payable on any other class or

classes of stock, or of any other series of stock, and cumulative, non-cumulative or partially

cumulative as is stated and expressed. When dividends upon the preferred and special stocks, if

any, to the extent of the preferences to which the stocks are entitled, have been paid or declared

and set apart for payment, a dividend on the remaining class or classes or series of stock may then

be paid out of the remaining assets of the corporation available for dividends.

      (c) Any preferred or special stock of any class or of any series may be made redeemable

for cash, property, or rights, including securities of any other corporation, at the option of either

the holder or the corporation or upon the happening of a specified event, at the time or times, at

the price or prices, or the rate or rates, and with the adjustments stated and expressed or provided

for in the articles of incorporation or any amendment of the articles or in the vote or votes

providing for the issuance of the stock adopted by the board of directors as previously provided.

      (d) The holders of the preferred or special stock of any class or of any series of that stock

are entitled to the rights upon the dissolution of, or upon any distribution of the assets or

liquidation, voluntary or involuntary, of the corporation as are stated and expressed in the articles

of incorporation or any amendment of the articles, or in the vote or votes providing for the issue

of the stock adopted by the board of directors as previously provided.

      (e) Any stock of any class or of any series of the stock may be made convertible into, or

exchangeable for, shares of any other class or classes or of any other series of the same or any

other class or classes of stock of the corporation, except a class having prior or superior rights and

preferences as to dividends or distribution of assets upon liquidation, at the price or prices or at

the rates of exchange and with the adjustments that are stated and expressed or provided for in the

articles of incorporation, or in any amendment to the articles, or in the vote or votes providing for

the issue of the stocks adopted by the board of directors as previously provided, but no shares,

whether with or without par value, are convertible into shares with par value unless that part of

the stated capital of the corporation represented by the shares to be converted, is at the time of

conversion, at least equal to the aggregate par value of the shares into which the shares are to be

converted.

      (f) If any corporation is authorized to issue more than one class of stock or more than

one series of any class, the designation, preferences, and relative, participating, optional, or other

special rights of each class of stock or series of the stock and the qualifications, limitations, or

restrictions of the preferences and/or rights shall be stated in full or summarized on the face or

back of the certificate which the corporation issues to represent the class or series of stock;

provided, however, that except as otherwise provided in section 6A-8-103, in lieu of the

foregoing requirements, there may be stated on the face or back of the certificate which the

corporation issues to represent the class or series of stock, a statement that the corporation will

furnish without charge to each stockholder who requests, the designations, preferences, and

relative, participating, optional, or other special rights of each class of stock or series of the stock

and the qualifications, limitations, or restrictions of the preferences and/or rights.

      (g) Before any corporation issues any shares of stock of any class or of any series of any

class of which the voting powers, designations, preferences, and relative, participating, optional,

or other rights, if any, or the qualifications, limitations, or restrictions of the stock, if any, have

not been stated in the articles of incorporation or in any amendment to the articles but are

provided for in a vote or votes adopted by the board of directors pursuant to authority expressly

vested in it by the provisions of the articles of incorporation or an amendment to the articles, a

certificate presenting a copy of the vote or votes and the number of shares of stock of the class or

series shall be made under the seal of the corporation and signed by the president or a vice

president and by the secretary or an assistant secretary of the corporation and acknowledged by

the president or vice president before an officer authorized by the laws of Rhode Island to take

acknowledgments of deeds, and shall be filed and a copy of the certificate shall be filed in the

same manner as articles of incorporation are required to be filed. Upon the filing the certificate

constitutes an amendment to the articles of incorporation. Unless otherwise provided in any vote

or votes, the number of shares of stock of any class or series as stated in the vote or votes may be

increased or decreased (but not below the number of shares of stock then outstanding) by a

certificate likewise made, signed, and filed presenting a statement that a specified increase or

decrease in the number of shares of stock had been authorized and directed by a vote or votes

likewise adopted by the board of directors. In case the number of shares shall be decreased, the

number of shares specified in the certificate resume the status which they had prior to the

adoption of the first resolution or resolutions.

     7-1.1-16. Subscription for shares. -- (a) A subscription for shares of a corporation to be

organized is irrevocable for a period of six (6) months, unless otherwise provided by the terms of

the subscription agreement or unless all of the subscribers consent to the revocation of the

subscription.

      (b) Unless otherwise provided in the subscription agreement, subscriptions for shares,

whether made before or after the organization of a corporation, shall be paid in full at a time, or in

installments and at times, that are determined by the board of directors. Any call made by the

board of directors for payment on subscriptions shall be uniform as to all shares of the same class

or as to all shares of the same series, as the case may be. In case of default in the payment of any

installment or call when the payment is due, the corporation may proceed to collect the amount

due in the same manner as any debt due the corporation. The bylaws may prescribe other

penalties for failure to pay installments or calls that may become due, but no penalty working a

forfeiture of a subscription, or of the amounts paid on the subscription, shall be declared as

against any subscriber unless the amount due on the subscription remains unpaid for a period of

twenty (20) days after written demand has been made for the amount. If mailed, the written

demand shall be deemed to be made when deposited in the United States mail in a sealed

envelope addressed to the subscriber at his or her last post office address known to the

corporation, with postage on the envelope prepaid. In the event of the sale of any shares by reason

of any forfeiture, the excess of proceeds realized over the amount due and unpaid on the shares

shall be paid to the delinquent subscriber or to his or her legal representative.

     7-1.1-17. Consideration for shares. -- (a) Shares having a par value may be issued for

the consideration expressed in dollars, not less than the par value of the shares, as is fixed from

time to time by the board of directors.

      (b) Shares without par value may be issued for the consideration expressed in dollars that

is fixed from time to time by the board of directors unless the articles of incorporation reserve to

the shareholders the right to fix the consideration. In the event that the right is reserved as to any

shares, the shareholders shall, prior to the issuance of the shares, fix the consideration to be

received for the shares, by a vote of the holders of a majority of all shares entitled to vote on the

consideration.

      (c) Treasury shares may be disposed of by the corporation for the consideration

expressed in dollars that may be fixed from time to time by the board of directors.

      (d) The part of the surplus of a corporation which is transferred to stated capital upon the

issuance of shares as a share divided is deemed to be the consideration for the issuance of the

shares.

      (e) In the event of the issuance of shares upon the conversion or exchange of

indebtedness or shares, the consideration for the shares issued shall be:

      (1) The principal sum of, and accrued interest on, the indebtedness exchanged or

converted, or the stated capital then represented by the shares exchanged or converted; and

      (2) That part of surplus, if any, transferred to stated capital upon the issuance of shares

for the shares exchanged or converted; and

      (3) Any additional consideration paid to the corporation upon the issuance of shares for

the indebtedness or shares exchanged or converted.

     7-1.1-18. Payment for shares. -- (a) The consideration for the issuance of shares may be

paid, in whole or in part, in money, in other property, tangible or intangible, or in labor or

services actually performed for the corporation. When payment of the consideration for which

shares are to be issued has been received by the corporation, the shares are deemed to be fully

paid and nonassessable.

      (b) Neither promissory notes nor future services constitute payment or part payment, for

the issuance of shares of a corporation.

      (c) In the absence of fraud in the transaction, the judgment of the board of directors or

the shareholders, as the case may be, as to the value of the consideration received for shares is

conclusive.

     7-1.1-18.1. Stock rights and options. -- Subject to any provisions in respect to rights and

options stated in its articles of incorporation, a corporation may create and issue, whether or not

in connection with the issuance and sale of any of its shares or other securities, rights or options

entitling the holders to purchase from the corporation shares of any class or classes. Those rights

or options shall be evidenced in any manner that the board of directors approves and, subject to

the provisions of the articles of incorporation, shall state the terms upon which, the time or times

within which and the price or prices at which the shares may be purchased from the corporation

upon the exercise of any right or option. In the absence of fraud in the transaction, the judgment

of the board of directors as to the adequacy of the consideration received for the rights or options

is conclusive. The price or prices to be received for any shares having a par value, other than

treasury shares, to be issued upon the exercise of the rights or options shall not be less than the

par value of those shares.

     7-1.1-19. Determination of amount of stated capital. -- (a) In the case of the issuance

by a corporation of shares having a par value, the consideration received for the shares constitutes

stated capital to the extent of the par value of the shares, or, if the shares have a preference in the

assets of the corporation in the event of involuntary liquidation which is greater than the par

value, then to the extent of the preference, and the excess, if any, of the consideration constitutes

capital surplus.

      (b) In the case of the issuance by a corporation of shares without par value, the entire

consideration received for the shares constitutes stated capital unless the corporation determines

as provided in this section that only a part of the shares is stated capital. Within a period of sixty

(60) days after the issuance of any shares without par value, the board of directors may allocate to

capital surplus any portion of the consideration received for the issuance of the shares. No

allocation shall be made of any portion of the consideration received for shares without par value

having a preference in the assets of the corporation in the event of involuntary liquidation except

the amount, if any, of the consideration in excess of the preference.

      (c) If shares have been or are issued by a corporation in merger or consolidation or in

acquisition of all or substantially all of the outstanding shares or of the property and assets of

another corporation, whether domestic or foreign, any amount that would otherwise constitute

capital surplus under the foregoing provisions of this section may instead be allocated to earned

surplus by the board of directors of the issuing corporation except that its aggregate earned

surplus shall not exceed the sum of the earned surpluses as defined in this chapter of the issuing

corporation and of all other corporations, domestic or foreign, that were merged or consolidated

or of which the shares or assets were acquired.

      (d) The stated capital of a corporation may be increased from time to time by resolution

of the board of directors directing that all or a part of the surplus of the corporation be transferred

to stated capital. The board of directors may direct that the amount of the surplus transferred is

deemed to be stated capital in respect of any designated class of shares.

     7-1.1-20. Expenses of organization, reorganization, and financing. -- The reasonable

charges and expenses of organization or reorganization of a corporation, and the reasonable

expenses of and compensation for the sale or underwriting of its shares, may be paid or allowed

by the corporation out of the consideration received by it in payment for its shares without

rendering the shares not fully paid or assessable.

     7-1.1-21. Certificates representing shares. -- (a) The shares of a corporation shall be

represented by certificates provided that the board of directors of the corporation may provide by

resolution or resolutions that some or all of any or all classes or series of its stock are

uncertificated shares. This resolution does apply to shares represented by a certificate until the

certificate is surrendered to the corporation. Notwithstanding the adoption of the resolution by the

board of directors, every holder of stock represented by certificates and upon request every holder

of uncertificated shares is entitled to have a certificate signed by the officer or officers designated

for the purpose by the bylaws of the corporation, and in absence of any designation, by the

chairperson or the vice chairperson of the board of directors, or the president or a vice president,

and by the treasurer or the assistant treasurer, or the secretary or an assistant secretary of the

corporation, representing the number of shares registered in certificate form and may be sealed

with the seal of the corporation or a facsimile of the seal. Any or all of the signatures on the

certificate may be a facsimile. In case any officer, transfer agent, or registrar who has signed or

whose facsimile signature has been placed upon the certificate has ceased to be the officer,

transfer agent, or registrar before the certificate is issued, it may be issued by the corporation with

the same effect as if he or she were the officer, transfer agent, or registrar at the date of its issue.

      (b) Every certificate representing shares issued by a corporation which is authorized to

issue shares of more than one class shall state upon the face or back of the certificate, or shall

state that the corporation will furnish to any shareholder upon request and without charge, a full

statement of the designations, preferences, limitations, and relative rights of the shares of each

class authorized to be issued and, if the corporation is authorized to issue any preferred or special

class in series, the variations in the relative rights and preferences between the shares of each

series so far as the series have been fixed and determined and the authority of the board of

directors to fix and determine the relative rights and preferences of subsequent series.

      (c) Each certificate representing shares shall state upon the face of the certificate:

      (1) That the corporation is organized under the laws of this state.

      (2) The name of the person to whom issued.

      (3) The number and class of shares, and the designation of the series, if any, which the

certificate represents.

      (4) If the shares are without par value, a statement of the fact.

      (d) No certificate shall be issued for any share until the share is fully paid.

      (e) Within a reasonable time after the issuance or transfer of uncertificated shares, the

corporation shall send to the registered owner of the shares a written notice containing the

information and statements required to be presented or stated on certificates pursuant to

subsections (b) and (c) and section 7-1.1-21.1(b). Except as otherwise expressly provided by law,

the rights and obligations of owners of shares are not affected by whether the shares are

represented by certificates or are uncertificated.

     7-1.1-21.1. Stock transfer restrictions. -- (a) The shares of a corporation are personal

property and are transferable in accordance with the provisions of section 6A-8-204, as amended

from time to time, except as may otherwise be provided in this chapter.

      (b) The articles of incorporation, bylaws, an agreement among all or less than all of the

shareholders, or an agreement between all or less than all of the shareholders and the corporation

may impose restrictions on the transfer or registration of transfer of shares of the corporation. A

restriction does not affect shares issued before the restriction was adopted unless the holders of

the shares are parties to the restriction agreement or voted in favor of the restriction.

      (c) A restriction on the transfer or registration of transfer of shares is valid and

enforceable against the holder or a transferee of the holder if the restriction is authorized by this

chapter and its existence is noted conspicuously on the front or back of the certificate or is

contained in the initial transaction statement required by section 6A-8-204(b). Unless noted, a

restriction is not enforceable against a person without knowledge of the restriction.

      (d) A restriction on the transfer or registration of transfer of shares is authorized:

      (1) To maintain the corporation's status when it is dependent on the number or identity of

its shareholders;

      (2) To preserve exemptions under federal or state securities law;

      (3) For any other reasonable purpose;

      (e) A restriction on the transfer or registration of transfer of shares may:

      (1) Obligate the shareholder first to offer the corporation or other persons (separately,

consecutively, or simultaneously) an opportunity to acquire the restricted shares;

      (2) Obligate the corporation or other persons (separately, consecutively, or

simultaneously) to acquire the restricted shares;

      (3) Require the corporation, the holders of any class of its shares, or another person to

approve the transfer of the restricted shares, if the requirement is not manifestly unreasonable;

      (4) Prohibit the transfer of the restricted shares to designated persons or classes of

persons, if the prohibition is not manifestly unreasonable.

      (f) For the purposes of this section, "shares" includes a security convertible into or

carrying a right to subscribe for or acquire shares.

     7-1.1-22. Fractional shares. -- A corporation may:

      (1) Issue fractions of a share,

      (2) Arrange for the disposition of fractional interests by those entitled to those interests,

      (3) Pay in cash the fair value of fractions of a share as of the time when those entitled to

receive the fractions are determined, or

      (4) Issue scrip in registered or bearer form which entitles the holder to receive a

certificate for a full share upon the surrender of the scrip aggregating a full share.

      A certificate for a fractional share shall, but scrip shall not, unless it otherwise provides,

entitle the holder to exercise voting rights, to receive dividends on that share, and to participate in

any of the assets of the corporation in the event of liquidation. The board of directors may issue

scrip subject to the condition that it becomes void if not exchanged for certificates representing

full shares before a specified date, or subject to the condition that the shares for which scrip is

exchangeable may be sold by the corporation and the proceeds from the sale distributed to the

holders of scrip, or subject to any other conditions which the board of directors deems advisable.

     7-1.1-22.1. Bonds -- Facsimile signatures and seals. -- The seal of the corporation and

any or all signatures of the officers or other agents of the corporation upon a bond and any

coupon attached to the bond may be facsimiles if the bond is countersigned by an officer or other

agent of a trustee or other certifying or authenticating authority. In case any officer or other agent

who has signed or whose facsimile signature has been placed upon the bond or coupon has ceased

to be the officer or agent before the bond is issued, it may be issued by the corporation with the

same effect as if he or she were the officer or agent at the date of its issue.

     7-1.1-23. Liability of subscribers and shareholders. -- (a) A holder of or subscriber to

shares of a corporation is under no obligation to the corporation or its creditors with respect to the

shares other than the obligation to pay to the corporation the unpaid portion of the consideration

for which the shares were issued or to be issued, which in no event shall be less than the amount

of the consideration for which the shares could be lawfully issued.

      (b) Any person becoming an assignee or transferee of shares or of a subscription for

shares in good faith and without knowledge or notice that the full consideration for the shares has

not been paid is not personally liable to the corporation or its creditors for any unpaid portion of

the consideration. An executor, administrator, conservator, guardian, trustee, assignee for the

benefit of creditors, or receiver is not personally liable to the corporation as a holder of or

subscriber to shares of a corporation but the estate and funds in his or her hands is so liable.

      (c) No pledgee or other holder of shares as collateral security is personally liable as a

shareholder.

     7-1.1-24. Shareholders' preemptive rights. -- (a) Except to the extent limited or denied

by this section or by the articles of incorporation, shareholders have a preemptive right to acquire

unissued or treasury shares or securities convertible into shares or carrying a right to subscribe to

or acquire shares.

      (b) Unless otherwise provided in the articles of incorporation:

      (1) No preemptive right exists:

      (i) To acquire any shares issued to directors, officers, or employees pursuant to approval

by the affirmative vote of the holders of a majority of the shares entitled to vote on the acquisition

or when authorized by and consistent with a plan previously approved by a vote of shareholders;

or

      (ii) To acquire any shares sold other than for money.

      (2) Holders of shares of any class that is preferred or limited as to dividends or assets are

not entitled to any preemptive right.

      (3) Holders of shares of common stock are not entitled to any preemptive right to shares

of any class that is preferred or limited as to dividends or assets or to any obligations, unless

convertible into shares of common stock or carrying a right to subscribe to or acquire shares of

common stock.

      (4) Holders of common stock without voting power have no preemptive right to shares

of common stock with voting power.

      (5) The preemptive right is only an opportunity to acquire shares or other securities

under terms and conditions that the board of directors may fix for the purpose of providing a fair

and reasonable opportunity for the exercise of the right.

     7-1.1-25. Bylaws. -- The bylaws may contain any provisions for the regulation and

management of the affairs of the corporation not inconsistent with law or the articles of

incorporation. The initial bylaws of a corporation shall be adopted by its incorporators or by its

board of directors at its organization meeting. Subsequently, the bylaws may be amended by the

shareholders, or, unless otherwise provided in the articles of incorporation or bylaws, by the

board of directors, but any amendment to the bylaws by the board of directors may be changed by

the shareholders.

     7-1.1-25.1. Bylaws and other powers in emergency. -- (a) The board of directors of any

corporation may adopt emergency bylaws, subject to repeal or change by action of the

shareholders, which are, notwithstanding any different provision elsewhere in this chapter or in

the articles of incorporation or bylaws, operative during any emergency in the conduct of the

business of the corporation resulting from an attack on the United States or any nuclear or atomic

disaster. The emergency bylaws may make any provision that may be practical and necessary for

the circumstances of the emergency, including provisions that:

      (1) A meeting of the board of directors may be called by any officer or director in any

manner and under conditions prescribed in the emergency bylaws;

      (2) The director or directors in attendance at the meeting, or any greater number fixed by

the emergency bylaws, constitutes a quorum; and

      (3) The officers or other persons designated on a list approved by the board of directors

before the emergency, all in the order of priority and subject to the conditions, and for a period of

time (not longer than reasonably necessary after the termination of the emergency) that may be

provided in the emergency bylaws or in the resolution approving the list, are, to the extent

required to provide a quorum at any meeting of the board of directors, deemed directors for the

meeting.

      (b) The board of directors, either before or during any emergency, may provide, and

from time to time modify, lines of succession in the event that during an emergency any or all

officers or agents of the corporation are for any reason rendered incapable of discharging their

duties.

      (c) The board of directors, either before or during any emergency, may, effective in the

emergency, change the head office or designate several alternative head offices or regional

offices, or authorize the officers so to do.

      (d) To the extent not inconsistent with any adopted emergency bylaws, the bylaws of the

corporation remain in effect during any emergency, and upon its termination the emergency

byaws cease to be operative.

      (e) Unless otherwise provided in emergency bylaws, notice of any meeting of the board

of directors during any emergency may be given only to those directors that it may be feasible to

reach at the time and by any means that may be feasible at the time, including publication or

radio.

      (f) To the extent required to constitute a quorum at any meeting of the board of directors

during any emergency, the officers of the corporation who are present are, unless otherwise

provided in emergency bylaws, deemed, in order of rank and within the same rank in order of

seniority, directors for the meeting.

      (g) No officer, director, or employee acting in accordance with any emergency bylaws is

liable except for willful misconduct. No officer, director, or employee is liable for any action

taken by him or her in good faith in an emergency in furtherance of the ordinary business affairs

of the corporation even though not authorized by the bylaws then in effect.

     7-1.1-26. Meetings of shareholders. -- (a) Meetings of shareholders may be held at any

place, either within or without this state, that may be stated in or fixed in accordance with the

bylaws. If no other place is stated or fixed, all meetings shall be held at the registered office of the

corporation. An annual meeting of shareholders shall be held at any time that may be stated or

fixed in accordance with the bylaws. Failure to hold the annual meeting at the designated time

does not work a forfeiture or dissolution of the corporation. If the annual meeting is not held

within any thirteen (13) month period the superior court may, in its discretion, on the application

of any shareholder, summarily order a meeting to be held.

      (b) Special meetings of the shareholders may be called by the board of directors, or by a

person or persons that may be authorized by the articles of incorporation or by the bylaws.

      (c) Upon the application of any shareholder, director, or person aggrieved, the superior

court for the county where the principal office of the corporation is located, shall immediately

hear and determine the validity of any election or appointment of any director or officer of a

corporation and the right of any person to hold the office, and, if any office is claimed by more

than one person, determine the person entitled to the office, and to that end shall determine the

voting and other rights of persons claiming those rights in respect of the election or appointment,

and confirm the election or appointment, order a new election, or direct s any other relief that

may be just and proper.

     7-1.1-27. Notice of shareholders' meetings. -- Written notice stating the place, day, and

hour of the meeting and, in case of a special meeting, the purpose or purposes for which the

meeting is called, shall be delivered not less than ten (10) nor more than sixty (60) days before

the date of the meeting, either personally or by mail, by or at the direction of the president, the

secretary, or the officer or persons calling the meeting, to each shareholder of record entitled to

vote at the meeting. If mailed, the notice is deemed to be delivered when deposited in the United

States mail addressed to the shareholder at his or her address as it appears on the stock transfer

books of the corporation, with prepaid postage on the mail. In the case of any corporation which

has fifty (50) or more shareholders of record, if two (2) successive notices, reports, or other

communications addressed to a shareholder of the corporation at the address of the shareholder

appearing on the books of the corporation have been returned to the corporation by the United

States postal service marked to indicate that the United States postal service is unable to deliver

the notices, reports, or other communications to the shareholder at the address, all future notices,

reports, or other communications are deemed to have been given without further mailing if they

are available for the shareholder upon written demand of the shareholder at the principal

executive office of the corporation for a period of one year from the date of the giving of the

notice, report, or other communication to other shareholders.

     7-1.1-28. Closing of transfer books and fixing record date. -- For the purpose of

determining shareholders entitled to notice of or to vote at any meeting of shareholders or any

adjournment of a meeting of shareholders, or entitled to receive payment of any dividend, or in

order to make a determination of shareholders for any other proper purpose, the board of directors

of a corporation may provide that stock transfer books are closed for a stated period, not less than

that specified in any applicable bylaw and not more than sixty (60) days. In lieu of closing the

stock transfer books, the bylaws, or in the absence of an applicable bylaw the board of directors,

may fix in advance a date as the record date for any determination of shareholders, the date in any

case to be not more than sixty (60) days prior to the date on which the particular action, requiring

the determination of shareholders, is to be taken. If the stock transfer books are not closed and no

record date is fixed for the determination of shareholders entitled to notice of or to vote at a

meeting of shareholders, or shareholders entitled to receive payment of a dividend, the date on

which notice of the meeting is mailed or the date on which the resolution of the board of directors

declaring the dividend is adopted, as the case may be, is the record date for the determination of

shareholders. When a determination of shareholders entitled to vote at any meeting of

shareholders has been made as provided in this section, the determination applies to any

adjournment, of the meeting.

     7-1.1-29. Voting list. -- A list of shareholders as of the record date, certified by the

corporate officer responsible for its preparation or by a transfer agent, shall be made available to

the inspectors of election, or person presiding at a meeting of stockholders, at any meeting of

shareholders upon the request of any shareholder at the meeting or prior to the meeting. The

persons who appear from the list to be shareholders entitled to vote at the meeting may vote at the

meeting. If the right to vote at any meeting is challenged, the inspectors of election, or the person

presiding at the meeting, shall rely on the list to determine the right of the challenged person to

vote.

     7-1.1-30. Quorum of shareholders required for shareholders' action. -- Unless

otherwise provided in the articles of incorporation or bylaws, a majority of the shares entitled to

vote, represented in person or by proxy, constitutes a quorum at a meeting of shareholders, but in

no event does a quorum consist of less than one-third ( 1/3) of the shares entitled to vote at the

meeting. If a quorum is present, the affirmative vote of the majority of the shares represented at

the meeting and entitled to vote on the subject matter is the act of the shareholders, unless the

vote of a greater number or voting by classes is required by this chapter or the articles of

incorporation or bylaws. No amendment to the bylaws made by the board of directors pursuant to

section 7-1.1-25 shall require a greater number or voting by classes.

     7-1.1-30.1. Greater voting requirements. -- Whenever, with respect to any action to be

taken by the shareholders of a corporation, the articles of incorporation require the vote or

concurrence of the holders of a greater proportion of the shares, or of any class or series of the

shares, than required by this chapter with respect to the action, the provisions of the articles of

incorporation control. An amendment of the articles of incorporation which changes or deletes a

provision is authorized by the same vote as would be required to take action under the provision.

     7-1.1-30.2. Waiver of notice. -- Whenever any notice is required to be given any person

under the provisions of this chapter or under the provisions of the articles of incorporation or

bylaws of the corporation, a waiver of the notice in writing signed by the person or persons

entitled to notice, whether before or after the time stated in the writing, is equivalent to the giving

of notice. Attendance of a person at a meeting constitutes a waiver of notice of the meeting,

except when the person attends a meeting for the express purpose of objecting to the transactions

of any business because the meeting is not lawfully called or convened. Neither the business to be

transacted at, nor the purpose of, any meeting of the shareholders or members of a committee of

the corporation need be specified in any written waiver of notice unless required by the by-laws.

     7-1.1-30.3. Action by shareholders without a meeting. -- (a) Any action required or

permitted to be taken at a meeting of shareholders by this chapter or the certificate of

incorporation or bylaws of a corporation, may be taken without a meeting if all the shareholders

entitled to vote on the action consent to the action in writing.

      (b) (1) Except for actions pursuant to section 7-1.1-67, section 7-1.1-70.1, or section 7-

1.1-72, any action required or permitted to be taken at a meeting of shareholders by this chapter

or the certificate of incorporation or bylaws of a corporation, may be taken without a meeting

upon the written consent of less than all the shareholders entitled to vote on the action, if:

      (i) shareholders who consent would be entitled to cast at least the minimum number of

votes which would be required to take the action at a meeting at which all shareholders entitled to

vote on the action are present; and

      (ii) Action pursuant to this section is authorized by the articles of incorporation.

      (2) Prompt notice of the action shall be given to all shareholders who would have been

entitled to vote upon the action if the meeting were held.

      (c) Whenever action is taken pursuant to this section, the written consents of the

shareholders consenting to the action shall be filed with the minutes of proceedings of

shareholders.

      (d) Any action taken pursuant to this section has the same effect for all purposes as if the

action had been taken at a meeting of the shareholders.

      (e) If any other provision of this chapter requires the filing of a certificate upon the

taking of an action by shareholders, and action is taken in the manner authorized by this section,

the certificate shall state that the action was taken without a meeting pursuant to the written

consents of the shareholders and shall state the number of shares represented by the consents.

      (f) The record date for determining shareholders entitled to express consent in writing

without a meeting, when no notice of the meeting is mailed, is the day on which the first written

consent is expressed.

     7-1.1-31. Voting of shares. -- (a) Each outstanding share, regardless of class, is entitled

to one vote on each matter submitted to a vote at a meeting of shareholders, except to the extent

that the voting rights of the shares of any class or classes are limited, enlarged, or denied by the

articles of incorporation as permitted by this chapter. If the articles of incorporation provide for

more or less than one vote for any share, on any matter, every reference in this chapter to a

majority or other proportion of shares shall refer to a majority or other proportion of votes entitled

to be cast.

      (b) Neither treasury shares, nor shares held, directly or indirectly, by another corporation

if a majority of the shares entitled to vote for the election of directors of the other corporation is

held by the corporation, shall be voted at any meeting or counted in determining the total number

of outstanding shares at any given time. Nothing contained in these provisions is construed as

limiting the right of any corporation to vote stock, including, but not limited to, its own stock,

held in a fiduciary capacity.

      (c) Every shareholder entitled to vote at a meeting of shareholders or to express consent

without a meeting may authorize another person or persons to act for him or her by proxy,

executed, in writing, by the shareholder or by his or her duly authorized attorney in fact. No

proxy is valid after eleven (11) months from the date of its execution, unless otherwise provided

in the proxy.

      (1) Without limiting the manner in which a stockholder may authorize another person or

persons to act for him or her as proxy pursuant to subsection (c), the following constitutes a valid

means by which a stockholder may grant that authority:

      (i) A stockholder may execute a writing authorizing another person or persons to act for

him or her as proxy. Execution may be accomplished by the stockholder or his or her authorized

officer, director, employee or agent signing the writing or causing his or her signature to be

affixed to the writing by any reasonable means including, but not limited to, facsimile signature.

      (ii) A stockholder may authorize another person or persons to act for him or her as proxy

by transmitting or authorizing the transmission of a telegram, cablegram, or other means of

electronic transmission, including Internet and telephonic transmissions, to the person who will

be the holder of the proxy or to a proxy solicitation firm, proxy support service organization or an

agent authorized by the person who will be the holder of the proxy to receive the transmission,

provided that the telegram, cablegram or other means of electronic transmission must either state

or be submitted or communicated with information from which it can be determined that the

telegram, cablegram or other electronic transmission, including Internet and telephonic

transmissions, was authorized by the stockholder. If it is determined that the telegrams,

cablegrams or other electronic transmissions, including Internet and telephonic transmissions, are

valid, the inspectors or, if there are no inspectors, the other persons making that determination

shall specify the information upon which they relied.

      (2) Any copy, facsimile telecommunication or other reliable reproduction of the writing

or transmission created pursuant to this section may be substituted or used in lieu of the original

writing or transmission for any and all purposes for which the original writing or transmission

could be used, provided that the copy, facsimile telecommunication or other reproduction is a

complete reproduction of the entire original writing or transmission.

      (d) The articles of incorporation may provide that at each election of directors, or at

elections held under specified circumstances, every shareholder entitled to vote at the election has

the right to vote, in person or by proxy, the number of shares owned by him or her for as many

persons as there are directors to be elected and for whose election he or she has a right to vote, or

to cumulate his or her votes by giving one candidate as many votes as the number of directors

multiplied by the number of his or her shares shall equal, or by distributing the votes on the same

principle among any number of the candidates.

      (e) Shares standing in the name of another corporation, domestic or foreign, may be

voted by any officer, agent, or proxy that the bylaws of the corporation may prescribe, or, in the

absence of a provision, as the board of directors of the corporation may determine.

      (f) Shares held by an administrator, executor, guardian, custodian under a gift to minors

act, or conservator may be voted by him or her, either in person or by proxy, without a transfer of

the shares into his or her name. Shares standing in the name of a trustee may be voted by him or

her, either in person or by proxy, but no trustee is entitled to vote shares held by him or her

without a transfer of the shares into his or her name.

      (g) Shares held by two (2) or more persons as joint tenants or as tenants in common may

be voted at any meeting of the shareholders by any one of the persons, unless another joint tenant

or tenant in common seeks to vote any of the shares in person or by proxy. In the latter event, the

written agreement, if any, which governs the manner in which the shares are voted, controls if

presented at the meeting. If there is no agreement presented at the meeting, the majority in

number of the joint tenants or tenants in common present shall control the manner of voting. If

there is no majority, or if there are two (2) joint tenants or tenants in common, both of whom seek

to vote the shares, the shares shall, for the purpose of voting, be divided equally among the joint

tenants or tenants in common present.

      (h) Shares standing in the name of a receiver may be voted by the receiver, and shares

held by or under the control of a receiver may be voted by the receiver without the transfer of

those shares into his or her name if authority to do so is contained in an appropriate order of the

court by which the receiver was appointed.

      (i) A shareholder whose shares are pledged is entitled to vote the shares until the shares

have been transferred into the name of the pledgee, and thereafter the pledgee is entitled to vote

the shares so transferred.

      (j) On and after the date on which written notice of redemption of redeemable shares has

been mailed to the holders of the shares and a sum sufficient to redeem the shares has been

deposited with a bank or trust company with irrevocable instruction and authority to pay the

redemption price to the holders of the shares upon surrender of certificates for the shares, the

shares shall not be entitled to vote on any matter and shall not be deemed to be outstanding

shares.

      (k) (1) An executed proxy is irrevocable if it specifies that it is irrevocable and if, and

only so long as, it is coupled with an interest sufficient in law to support an irrevocable power

coupled with it.

      (2) Without limiting the generality of subsection (a) and subject to that subsection, a

proxy is coupled with an interest and irrevocable if it is held by any of the following or a nominee

of any of the following:

      (i) A pledgee under a valid pledge;

      (ii) A person who has agreed to purchase the shares under an executory contract of sale;

      (iii) A creditor or creditors of the corporation who extend or continue credit to the

corporation in consideration of the proxy if the proxy states that it was given in consideration of

the extension or continuation of credit, the amount of the credit, and the name of the person

extending or continuing credit; and

      (iv) A person who has contracted to perform services for the corporation if a proxy is

required by the contract of employment, as part of the consideration for the contract of

employment, if the proxy states that it was given in consideration of the contract of employment,

the name of the employee, and the period of employment contracted for; provided the proxies

shall respectively be revocable after the pledge is redeemed, or the executory contract of sale is

performed, or the debt of the corporation is paid, or the period of employment has terminated.

      (3) A provision contained in a proxy making it irrevocable is not enforceable against a

purchaser for value of the shares subject to the provision without actual knowledge of the

existence of the provision, unless notice of the proxy and its irrevocability appears plainly on the

certificate or certificates representing the shares.

     7-1.1-32. Voting trusts and agreements among shareholders. -- (a) Any number of

shareholders of a corporation may create a voting trust for the purpose of conferring upon a

trustee or trustees the right to vote or otherwise represent their shares, for a period not to exceed

ten (10) years, by entering into a written voting trust agreement specifying the terms and

conditions of the voting trust, by depositing a counterpart of the agreement with the corporation at

its registered office, and by transferring their shares to the trustee or trustees for the purposes of

the agreement. The trustee or trustees shall keep a record of the holders of voting trust certificates

evidencing a beneficial interest in the voting trust, giving the names and addresses of all the

holders and the number and class of the shares in respect of which the voting trust certificates

held by each are issued, and shall deposit a copy of the record with the corporation at its

registered office. The counterpart of the voting trust agreement and the copy of the record

deposited with the corporation are subject to the same right of examination by a shareholder of

the corporation, in person or by agent or attorney, as are the books and records of the corporation,

and the counterpart and the copy of the record is subject to examination by any holder of record

of voting trust certificates, either in person or by agent or attorney, at any reasonable time for any

proper purpose. In the trust certificates it shall be stated that they are issued pursuant to the voting

trust agreement, and that fact shall be stated in the stock ledger of the corporation.

      (b) Agreements among shareholders regarding the voting of their shares are valid and

enforceable in accordance with their terms for a period of not to exceed ten (10) years. An

agreement is not subject to the provision of this section regarding voting trusts unless it is stated

in the agreement that it is a voting trust.

      (c) The provisions of this section are construed as permissive and shall not be interpreted

to invalidate any voting or other agreement among stockholders, or any irrevocable proxy which

is otherwise not illegal.

      (d) A voting trust or shareholders agreement may at any time or times be extended for an

additional period not in excess of ten (10) years, but the extension is binding only with respect to

those shares owned of record or beneficially by parties to the extension.

     7-1.1-32.1. Voting and inspection rights of bondholders and debentureholders. --

The articles of incorporation may, to the extent and in the manner provided in the articles, confer

on the holders of bonds or other evidences of indebtedness of the corporation rights to vote in the

election of directors and on any other matters on which shareholders may vote and rights to

inspect the books and records of the corporation. The articles of incorporation may also, to the

extent and in the manner provided in the articles, divest the holders of voting shares, in whole or

in part, of their right to vote on any corporate matter whatsoever, except as set forth in section 7-

1.1-55.

     7-1.1-33. Board of directors. -- (a) The business and affairs of a corporation are

managed by a board of directors. Directors need not be residents of this state or shareholders of

the corporation unless the articles of incorporation or bylaws require it. The articles of

incorporation or bylaws may prescribe other qualifications for directors. The board of directors

has authority to fix the compensation of directors unless otherwise provided in the articles of

incorporation.

      (b) A director shall discharge his or her duties as a director, including his or her duties as

a member of a committee:

      (1) In good faith;

      (2) With the care an ordinarily prudent person in a like position would exercise under

similar circumstances; and

      (3) In a manner he or she reasonably believes to be in the best interests of the

corporation.

      (c) In discharging his or her duties, a director is entitled to rely on information, opinions,

reports, or statements, including financial statements and other financial data, if prepared or

presented by:

      (1) One or more officers or employees of the corporation whom the director reasonably

believes to be reliable and competent in the matters presented;

      (2) Legal counsel, public accountants, or other persons as to matters the director

reasonably believes are within the person's professional or expert competence; or

      (3) A committee of the board of directors of which he or she is not a member if the

director reasonably believes the committee merits confidence.

      (d) A director is not acting in good faith if he or she has knowledge concerning the

matter in question that makes reliance otherwise permitted by subsection (c) unwarranted.

      (e) A director is not liable for any action taken as a director, or any failure to take any

action, if he or she performed the duties of his or her office in compliance with this section.

      (f) For the purposes of subsections (b) through (e), "corporation" also includes any

financial institution, insurance company, public utility or other quasi-public corporation having

purposes enumerated as exceptions to this chapter in section 7-1.1-3 and the provisions of

subsections (b) through (e) of this section are applicable to the directors of that corporation.

     7-1.1-34. Number and election of directors. -- The board of directors of a corporation

consists of one or more members. The number of directors are fixed by, or in the manner

provided in, the articles of incorporation or the bylaws except as to the number constituting the

initial board of directors, which number is fixed by the articles of incorporation. The number of

directors may be increased or decreased from time to time by amendment to, or in the manner

provided in, the articles of incorporation or the bylaws, but no decrease has the effect of

shortening the term of any incumbent director. If the articles of incorporation provide for the

election of directors in the manner specified in subsection (d) of section 7-1.1-31, the number of

directors may not be decreased unless approved by the stockholders with less than the number of

shares previously entitled to elect one director voting against the decrease. In the absence of a

bylaw fixing the number of directors, the number is the same as that provided for in the articles of

incorporation. The names and addresses of the members of the first board of directors shall be

stated in the articles of incorporation. Those persons hold office until the first annual meeting of

shareholders, and until their successors have been elected and qualified. At the first annual

meeting of shareholders and at each subsequent annual meeting, the shareholders shall elect

directors to hold office until the next succeeding annual meeting, except in the case of the

classification of directors as permitted by this chapter. Each director holds office for the term for

which he or she is elected and until his or her successor has been elected and qualified.

     7-1.1-35. Classification of directors. -- When the board of directors consists of nine (9)

or more members, in lieu of electing the whole number of directors annually, the articles of

incorporation may provide that the directors be divided into either two (2) or three (3) classes,

each class to be as nearly equal in number as possible, the term of office of directors of the first

class to expire at the first annual meeting of shareholders after their election, that of the second

class to expire at the second annual meeting after their election, and that of the third class, if any,

to expire at the third annual meeting after their election. At each annual meeting after the

classification, the number of directors equal to the number of the class whose term expires at the

time of the meeting shall be elected to hold office until the second succeeding annual meeting, if

there are two (2) classes, or until the third succeeding annual meeting, if there are three (3)

classes. No classification of directors is effective prior to the first annual meeting of shareholders.

The articles of incorporation may confer upon holders of any class or series of stock the right to

elect one or more directors who serve for any term and have any voting powers stated in the

articles of incorporation. The terms of office and voting powers of the directors elected in the

manner provided in the articles of incorporation may be greater than or less than those of any

other director or class of directors.

     7-1.1-36. Vacancies. -- Any vacancy occurring in the board of directors may be filled by

the affirmative vote of a majority of the remaining directors though less than a quorum of the

board of directors. A director elected to fill a vacancy is elected for the unexpired term of his or

her predecessor in office. Any directorship to be filled by reason of an increase in the number of

directors may be filled by the board of directors for a term of office continuing only until the next

election of directors by the shareholders.

     7-1.1-36.1. Removal of directors. -- (a) Any or all of the directors may be removed for

cause by vote of the shareholders. The certificate of incorporation or the specific provisions of a

bylaw adopted by the shareholders may provide for the removal by action of the board, except in

the case of any director elected by cumulative voting, or by the holders of the shares of any class

or series, or holders of bonds, voting as a class, when entitled by the provisions of the articles of

incorporation.

      (b) If the articles of incorporation or the bylaws provide, any or all of the directors may

be removed without cause by vote of the shareholders.

      (c) The removal of directors, with or without cause, as provided in subsections (a) and

(b) is subject to the following:

      (1) In the case of a corporation having cumulative voting, no director may be removed

when the votes cast against his or her removal would be sufficient to elect him or her if voted

cumulatively at an election at which the same total number of votes were cast and the entire

board, or the entire class of directors of which he or she is a member, were then being elected;

and

      (2) When by the provisions of the articles of incorporation the holders of the shares of

any class or series, or holders of bonds, voting as a class, are entitled to elect one or more

directors, any director so elected may be removed only by the applicable vote of the holders of

the shares of that class or series or the holders of the bonds, voting as a class.

      (d) An action to procure a judgment removing a director for cause may be brought by the

attorney general or by the holders of ten percent (10%) of the outstanding shares, whether or not

entitled to vote. The court having jurisdiction may bar from reelection any directors so removed

for a period fixed by the court.

     7-1.1-37. Quorum of directors. -- A majority of the number of directors fixed by or in

the manner provided in the bylaws, or by the stockholders or in the absence of a bylaw or

stockholder action fixing the number of directors, then of the number stated in the articles of

incorporation, constitutes a quorum for the transaction of business unless a greater number is

required by the articles of incorporation or the bylaws. The act of the majority of the directors

present at a meeting at which a quorum is present is the act of the board of directors, unless the

act of a greater number is required by the articles of incorporation or the bylaws.

     7-1.1-37.1. Director conflicts of interest. -- (a) No contract or transaction between a

corporation and one or more of its directors or officers, or between a corporation and any other

corporation, partnership, association, or other organization in which one or more of its directors

or officers are directors or officers or have a financial interest, is void or voidable nor are the

directors or officers liable with respect to the contract or transaction solely for this reason, or

solely because the director or officer is present at or participates in the meeting of the board or

committee of the board which authorizes the contract or transaction, or solely because his or her

or their votes are counted for that purpose, if:

      (1) The material facts as to his or her or their interest or relationship are disclosed or are

known to the board of directors or the committee, and the board of directors or committee

authorizes, approves, or ratifies the contract or transaction by the affirmative votes of a majority

of the disinterested directors, even though the disinterested directors are less than a quorum; or

      (2) The material facts as to his or her or their interest or relationship are disclosed or are

known to the shareholders entitled to vote on the contract or transaction, and the contract or

transaction is specifically authorized, approved, or ratified by vote of the shareholders; or

      (3) The contract or transaction is fair and reasonable as to the corporation.

      (b) Common or interested directors may be counted in determining the presence of a

quorum at a meeting of the board of directors or of a committee which authorizes the contract or

transaction.

     7-1.1-38. Executive and other committees. -- If the articles of incorporation or the

bylaws provide, the board of directors, by resolution adopted by a majority of the full board of

directors, may designate from among its members an executive committee and one or more other

committees each of which, to the extent provided in the resolution or in the articles of

incorporation or the bylaws of the corporation, have and may exercise all the authority of the

board of directors, but no committee has the authority of the board of directors in reference to

amending the articles of incorporation, adopting a plan of merger or consolidation,

recommending to the shareholders the sale, lease, exchange, or other disposition of all or

substantially all the property and assets of the corporation other than in the usual and regular

course of its business, recommending to the shareholders a voluntary dissolution or revocation of

the corporation, or amending the bylaws of the corporation. The designation of any committee

and the delegation to the committee of authority does not operate to relieve the board of directors,

or any member of the board, of any responsibility imposed by law.

     7-1.1-39. Place, notice, and form of directors' and committee meetings. -- (a)

Meetings of the board of directors, or any committee designated by the board, regular or special,

may be held either within or without this state.

      (b) Regular meetings of the board of directors or any committee designated by the board

may be held with or without notice as prescribed in the bylaws. Special meetings of the board of

directors or any committee designated by the board shall be held upon notice that is prescribed in

the bylaws. Attendance of a director at a meeting constitutes a waiver of notice of the meeting,

except where a director attends a meeting for the express purpose of objecting to the transaction

of any business because the meeting is not lawfully called or convened. Neither the business to be

transacted at, nor the purpose of, any regular or special meeting of the board of directors or any

committee designated by the board of directors need be specified in the notice or waiver of notice

of the meeting unless required by the bylaws. Except as may be otherwise restricted by the

articles of incorporation or bylaws, members of the board of directors or any committee

designated by the board of directors may participate in a meeting of the board or committee by

means of a conference telephone or similar communications equipment, by means of which all

persons participating in the meeting can hear each other at the same time and participation by

those means constitutes presence in person at a meeting.

     7-1.1-39.1. Action by directors without a meeting. -- Unless otherwise provided by the

articles of incorporation or bylaws, any action required by this chapter to be taken at a meeting of

the directors of a corporation, or any action which may be taken at a meeting of the directors or of

a committee, may be taken without a meeting if a consent, in writing, stating the action to be

taken, is signed before or after the action by all of the directors, or all of the members of the

committee, as the case may be. The consent has the same effect as a unanimous vote for all

purposes, and that may be stated in any certificate or other document filed with the secretary of

state.

     7-1.1-40. Dividends. -- (a) The board of directors of a corporation may, from time to

time, declare and the corporation may pay dividends on its outstanding shares in cash, property,

or its own shares, except when the corporation is insolvent or when the payment of dividends

would render the corporation insolvent or when the declaration or payment of dividends would be

contrary to any restrictions contained in the articles of incorporation, subject to the following

provisions:

      (1) No distribution may be made if, after giving it effect, any of the following would

occur:

      (i) The corporation would not be able to pay its debts as they become due in the usual

course of business.

      (ii) The corporation's total assets would be less than the sum of its total liabilities plus,

unless the articles of incorporation permit otherwise, the amount that would be needed, if the

corporation were to be dissolved at the time of the distribution, to satisfy the preferential rights

upon dissolution of shareholders whose preferential rights are superior to those receiving the

distribution.

      (2) If the articles of incorporation of a corporation engaged in the business of exploiting

natural resources provides, dividends may be declared and paid in cash out of the depletion

reserves, but each dividend shall be identified as a distribution of the reserves and the amount per

share paid from the reserves shall be disclosed to the shareholders receiving the dividend

concurrently with the distribution of the dividend.

      (3) Dividends may be declared and paid by a corporation in its own treasury shares.

      (4) Dividends may be declared and paid in its own authorized but unissued shares upon

the following conditions:

      (i) If a dividend is payable in its own shares having a par value, the shares shall be issued

at not less than the par value of the shares and there shall be transferred to stated capital at the

time the dividend is paid an amount of surplus equal to the aggregate par value of the shares to be

issued as a dividend.

      (ii) If a dividend is payable in its own shares without par value, the shares shall be issued

at the stated value that is fixed by the board of directors by resolution adopted at the time the

dividend is declared, and there shall be transferred to stated capital at the time the dividend is paid

an amount of surplus equal to the aggregate stated value fixed in respect of the shares; and the

amount per share transferred to stated capital shall be disclosed to the shareholders receiving the

dividend concurrently with that payment.

      (5) No dividend payable in shares of any class shall be paid to the holders of shares of

any other class unless the articles of incorporation provide or the payment is authorized by the

affirmative vote or the written consent of the holders of at least a majority of the outstanding

shares of the class in which the payment is to be made.

      (b) A split up or division of the issued shares of any class into a greater number of shares

of the same class without increasing the stated capital of the corporation is not construed to be a

share dividend within the meaning of this section.

     7-1.1-41. Distribution from capital surplus. -- (a) Upon the vote of its board of

directors, a corporation may, from time to time distribute to its shareholders, directly or by the

purchase of its own shares, a portion of its assets, in cash or property, out of the unreserved and

unrestricted capital surplus of the corporation, subject to the following provisions:

      (1) No distribution shall be made at a time when the corporation is insolvent or when the

distribution would render the corporation insolvent.

      (2) No distribution shall be made unless the articles of incorporation provide for one or

the distribution is authorized by the affirmative vote of the holders of a majority of the

outstanding shares of each class whether or not entitled to vote on the distribution by the

provisions of the articles of incorporation of the corporation.

      (3) No distribution shall be made to the holders of any class of shares unless all

cumulative dividends accrued on all preferred or special classes of shares entitled to preferential

dividends have been fully paid.

      (4) No distribution shall be made to the holders of any class of shares unless the fair

value of the net assets of the corporation remaining after the distribution is at least equal to the

largest of the following:

      (i) The total stated capital of the corporation;

      (ii) The aggregate preferential amount payable in the event of involuntary liquidation to

the holders of shares having preferential rights to the assets of the corporation in the event of

liquidation; and

      (iii) Twenty-five percent (25%) of the total liabilities of the corporation.

      (5) No distribution shall be made if the corporation has any earned surplus.

      (6) Any distribution shall be identified as a distribution from capital surplus, and, if that

is the case, specifically from revaluation surplus; and the amount per share shall be disclosed to

the shareholders receiving the amount concurrently with its distribution.

      (b) Notwithstanding the foregoing limitations, the board of directors of a corporation

may also, from time to time, distribute to the holders of its outstanding shares having a

cumulative preferential right to receive dividends, in discharge of their cumulative dividend

rights, dividends payable in cash out of the capital surplus of the corporation, if at the time the

corporation has no earned surplus and is not insolvent and would not be rendered insolvent as a

result. Each distribution, when made, shall be identified as a payment of cumulative dividends out

of capital surplus.

     7-1.1-42. Loans to employees and directors. -- A corporation shall not lend money to or

use its credit to assist its directors without authorization in the particular case by its shareholders,

but may lend money to, guarantee any obligation of, or otherwise use its credit to assist any

employee of the corporation or of a subsidiary, including any employee who is a director of the

corporation or of a subsidiary, if the board of directors decides that the loan, guaranty, or other

assistance may benefit the corporation. The loan, guaranty, or other assistance may be with or

without interest, and may be unsecured, or secured in any manner that the board of directors

approves, including, without limitation, a pledge of shares of stock of the corporation. Nothing

contained in this section is deemed to deny, limit, or restrict the powers of guaranty or warranty

of any corporation at common law or under any statute.

     7-1.1-43. Liability of directors in certain cases. -- (a) In addition to any other liabilities

imposed by law upon directors of a corporation:

      (1) Directors of a corporation who vote for or assent to the declaration of any dividend or

other distribution of the assets of a corporation to its shareholders contrary to the provisions of

this chapter or contrary to any restrictions contained in the articles of incorporation, are jointly

and severally liable to the corporation for the amount of the dividend which is paid or the value of

the assets which are distributed in excess of the amount of the dividend or distribution which

could have been paid or distributed without a violation of the provisions of this chapter or the

restrictions in the articles of incorporation.

      (2) Directors of a corporation who vote for or assent to the purchase of its own shares

contrary to the provisions of this chapter are jointly and severally liable to the corporation for the

amount of consideration paid for the shares which is in excess of the maximum amount which

could have been paid for the shares without a violation of the provisions of this chapter.

      (3) The directors of a corporation who vote for or assent to any distribution of assets of a

corporation to its shareholders during the liquidation of the corporation without the payment and

discharge of, or making adequate provision for, all known debts, obligations, and liabilities of the

corporation are jointly and severally liable to the corporation for the value of the assets which are

distributed, to the extent that the debts, obligations, and liabilities of the corporation are not

subsequently paid and discharged.

      (b) A director of a corporation who is present at a meeting of its board of directors at

which action on any corporate matter is taken is presumed to have assented to the action taken

unless his or her dissent is entered in the minutes of the meeting or unless he or she files his or

her written dissent to the action with the person acting as the secretary of the meeting before the

meeting's adjournment or forwards the dissent by registered mail to the secretary of the

corporation immediately after the adjournment of the meeting. The right to dissent does not apply

to a director who voted in favor of the action.

      (c) A director is not liable under this section if under the circumstances he or she acted

with due care and in good faith, and without limiting the generality of what has just been stated, is

not liable if he or she relied in good faith upon financial statements of the corporation represented

to him or her to be correct and to be based upon generally accepted accounting principles by the

president or the officer of the corporation having charge of its books of account, or stated in a

written report by an independent public or certified public accountant or firm of accountants

fairly to reflect the financial condition of the corporation.

      (d) Any director against whom a claim is asserted under or pursuant to this section for

the payment of a dividend or other distribution of assets of a corporation and who is held liable on

the claim, is entitled to contribution from the shareholders who accepted or received any dividend

or assets, knowing the dividend or distribution to have been made in violation of this chapter, in

proportion to the amounts received by them respectively.

     7-1.1-43.1. Actions by shareholders. -- (a) No action shall be brought in this state by a

shareholder in the right of a domestic or foreign corporation unless the plaintiff was a holder of

record of shares or of voting trust certificates for the shares at the time of the transaction of which

he or she complains, or his or her shares or voting trust certificates subsequently devolved upon

him or her by operation of law from a person who was a holder of record at the time.

      (b) In any action hereafter instituted in the right of any domestic or foreign corporation

by the holder or holders of record of shares of the corporation or of voting trust certificates for the

shares, the court having jurisdiction, upon final judgment and a finding that the action was

brought without reasonable cause, may require the plaintiff or plaintiffs to pay to the parties

named as defendant the reasonable expenses, including attorney's fees, incurred by them in the

defense of the action.

     7-1.1-44. Officers. -- (a) The officers of a corporation consist of a chairperson of the

board of directors, if prescribed by the by-laws, a president, one or more vice presidents, if

prescribed by the bylaws, a secretary, and a treasurer, each of whom is elected by the board of

directors or by the stockholders at a time and in a manner as prescribed by the bylaws. Any other

officers and assistant officers and agents as that are necessary may be elected or appointed by the

board of directors or by the stockholders or chosen in another manner prescribed by the bylaws.

Any two (2) or more offices may be held by the same person. A failure to elect officers does not

dissolve or otherwise affect the corporation.

      (b) All officers and agents of the corporation, as between themselves and the

corporation, have the authority and perform any duties in the management of the corporation that

may be provided in the bylaws, or that may be determined by resolution of the board of directors,

subject to any limitations on the authority contained in the bylaws.

     7-1.1-45. Removal of officers. -- Any officer or agent may be removed by the board of

directors whenever, in its judgment, the best interests of the corporation will be served by the

removal, but the removal shall be without prejudice to the contract rights, if any, of the person

removed. Election or appointment of an officer or agent does not of itself create contract rights.

     7-1.1-46. Books and records. -- (a) Each corporation shall keep correct and complete

books and records of account, l keep minutes of the proceedings of its shareholders and of the

board of directors and committees of the board, and shall also keep at its registered office or

principal place of business, or at the office of its transfer agent or registrar, a record of its

shareholders giving the names and addresses of all shareholders and the number and class of the

shares held by each. Any books, records, and minutes may be in written form or any other form

capable of being converted into written form within a reasonable time.

      (b) Any person who has been a shareholder of record or of voting trust certificates for

the shares for at least six (6) months immediately preceding his or her demand or is be the holder

of record of, or the holder of record of voting trust certificates for, at least five percent (5%) of all

the outstanding shares of a corporation, upon written demand stating the purpose for the demand,

shall have the right to examine, in person, or by agent or attorney, at any reasonable time or

times, for any proper purpose, its relevant books and records of account, minutes, and record of

shareholders and to make extracts from those books and records of account, minutes, and record

of shareholders.

      (c) Any officer or agent who, or a corporation which, refuses to allow any shareholder or

holder of voting trust certificates, or his or her agent or attorney, to examine and make extracts

from its books and records of account, minutes, and record of shareholders, for any proper

purpose, is liable to the shareholder or holder of voting trust certificates in a penalty of ten

percent (10%) of the value of the shares owned by the shareholder, or in respect of which the

voting trust certificates are issued, in addition to any other damages or remedy afforded him or

her by law. It is a defense to any action for penalties under this section that the person bringing

the suit has within two (2) years sold or offered for sale any list of shareholders or of holders of

voting trust certificates for shares of the corporation or any other corporation or has aided or

abetted any person in procuring any list of shareholders or of holders of voting trust certificates

for that purpose, or has improperly used any information secured through any prior examination

of the books and records of account, or minutes, or record of shareholders, or of holders of voting

trust certificates for shares of the corporation or any other corporation, or was not acting in good

faith or for a proper purpose in making his or her demand.

      (d) Nothing contained in these provisions impairs the power of any court of competent

jurisdiction, upon proof by a shareholder or holder of voting trust certificates of proper purpose,

irrespective of the period of time during which the shareholder or holder of voting trust

certificates has been a shareholder of record or a holder of record of voting trust certificates and

irrespective of the number of shares held by him or her, or represented by voting trust certificates

held by him or her, to compel the production for examination by the shareholder or holder of

voting trust certificates of the books and records of account, minutes, and record of shareholders

of a corporation.

      (e) Upon the written request of any shareholder or holder of voting trust certificates for

shares of a corporation, the corporation shall mail to the shareholder or holder of voting trust

certificates its most recent financial statements showing in reasonable detail its assets and

liabilities and the results of its operations.

     7-1.1-47. Incorporators. -- (a) One or more persons may act as incorporator or

incorporators of a corporation by delivering in duplicate to the secretary of state articles of

incorporation for the corporation, which shall be signed and acknowledged before a notary

public.

      (b) Until the corporation issues shares of stock, the incorporator or incorporators has all

the powers of the shareholders. Until the directors, if any, are elected and have assumed their

duties, the incorporator or incorporators has all the powers of directors with respect to the

management of the business and affairs of the corporation, and may do whatever is necessary and

proper to perfect the organization of the corporation, including, but not limited to, the adoption

and amendment of bylaws, amendment of the articles of incorporation, election of officers, and

issuance of shares of stock and the fixing of the consideration for the shares.

      (c) The incorporator or incorporators calling a meeting under this section shall give at

least three (3) days' notice of the meeting by mail to each incorporator. The notice shall state the

time and place of the meeting.

      (d) Any action permitted to be taken at the meeting or meetings of incorporators, under

this section may be taken without a meeting if a consent, in writing, stating the action to be taken,

is signed by all of the incorporators.

     7-1.1-48. Articles of incorporation. -- (a) The articles of incorporation shall state:

      (1) The name of the corporation.

      (2) The period of duration, which may be perpetual.

      (3) The specific purpose or purposes for which the corporation is organized and which

may include the transaction of any or all lawful business for which corporations may be

incorporated under this chapter.

      (4) (i) If the corporation is to be authorized to issue only one class of stock, the total

number of shares of stock which the corporation has authority to issue; and:

      (A) The par value of each of the shares; or

      (B) A statement that all the shares are to be without par value; or

      (ii) If the corporation is to be authorized to issue more than one class of stock, the total

number of shares of all classes of stock which the corporation has authority to issue and:

      (A) The number of the shares of each class of stock that are to have a par value and the

par value of each share of each class; and/or

      (B) The number of the shares that are to be without par value; and

      (C) A statement of all or any of the designations and the powers, preferences, and rights,

including voting rights, and the qualifications, limitations, or restrictions of them, which are

permitted by the provisions of this chapter in respect of any class or classes of stock of the

corporation and the fixing of which by the articles of association is desired, and an express grant

of the authority as it may then be desired to grant to the board of directors to fix by vote or votes

any of them that may be desired but which is not fixed by the articles.

      (5) Any provisions dealing with the preemptive right of shareholders pursuant to the

provisions of section 7-1.1-24.

      (6) Any provision, not inconsistent with law, which the incorporators elect to set forth in

the articles of incorporation for the regulation of the internal affairs of the corporation, including,

but not limited to, a provision eliminating or limiting the personal liability of a director to the

corporation or to its stockholders for monetary damages for breach of the director's duty as a

director; provided that the provision does not eliminate or limit the liability of a director for:

      (i) Any breach of the director's duty of loyalty to the corporation or its stockholders;

      (ii) Acts or omissions not in good faith or which involve intentional misconduct or a

knowing violation of law;

      (iii) Liability imposed pursuant to the provisions of section 7-1.1-43; or

      (iv) Any transaction from which the director derived an improper personal benefit

(unless the transaction is permitted by section 7-1.1-37.1); and also including;

      (v) Any provision which under this chapter is required or permitted to be set forth in the

bylaws. No provision eliminating or limiting the personal liability of a director will be effective

with respect to causes of action arising prior to the inclusion of the provision in the articles of

incorporation of the corporation.

      (7) The address of its initial registered office, and the name of its initial registered agent

at the address.

      (8) The number of directors, if any, constituting the initial board of directors, or, if none,

the titles of the initial officers of the corporation and the names and addresses of the persons who

are to serve as directors or officers until the first annual meeting of shareholders or until their

successors are elected and qualify.

      (9) The name and address of each incorporator.

      (10) If, pursuant to section 7-1.1-50, the corporate existence is to begin at a time

subsequent to the issuance of the certificate of incorporation by the secretary of state, the date

when corporate existence begins.

      (b) It is not necessary to set forth in the articles of incorporation any of the corporate

powers enumerated in this chapter.

      (c) The provisions permitted by subsection (a)(6) may also be included in the articles of

incorporation or legislative charter of any existing or future financial institution, insurance

company, public utility, or other quasi public corporation having purposes enumerated as

exceptions to this chapter in section 7-1.1-3.

     7-1.1-49. Filing of articles of incorporation. -- (a) Duplicate originals of the articles of

incorporation shall be delivered to the secretary of state. If the secretary of state finds that the

articles of incorporation conform to law, he or she shall, when all fees have been paid;

      (1) Endorse on each of the duplicate originals the word "Filed," and the month, day, and

year of the filing.

      (2) File one of the duplicate originals in his or her office.

      (3) Issue a certificate of incorporation to which he or she affixes the other duplicate

original.

      (b) The certificate of incorporation, together with the duplicate original of the articles of

incorporation affixed to it by the secretary of state, shall be returned to the incorporators or their

representative.

     7-1.1-50. Effect of issuance of certificate of incorporation. -- Upon the issuance of the

certificate of incorporation or upon a later date, not more than thirty (30) days after the filing of

the articles of incorporation, as is set forth in the articles, the corporate existence begins, and the

certificate of incorporation is conclusive evidence that all conditions precedent required to be

performed by the incorporators have been complied with and that the corporation has been

incorporated under this chapter, except as against this state in a proceeding to cancel or revoke

the certificate of incorporation or for involuntary dissolution of the corporation.

     7-1.1-51. Close corporations. -- (a) Provisions of the articles of incorporation or bylaws

of a corporation organized under this chapter, or provisions of an agreement relating to a

corporation, which would otherwise be invalid because they:

      (1) Restrict, or assign to one or more shareholders or other persons, any or all of the

powers normally vested in the board of directors or provide that there is no board of directors, or

      (2) Grant the right to one or more stockholders to dissolve the corporation at will or on

the occurrence of a specified contingency, or

      (3) Impose too great a restraint on the transfer of shares of the corporation,

      are nevertheless valid if the provisions have been approved by all the shareholders of the

corporation and if the corporation's original or amended articles of incorporation contain a

heading immediately after the name of the corporation stating that it is a close corporation

pursuant to this section. This subsection is not deemed to invalidate any provision in articles of

incorporation, bylaws, or agreements that would otherwise be valid. A provision authorized by

subsection (a) (1) may include a provision that there shall be no board of directors.

      (b) The provisions of section 7-1.1-32 limiting the duration of a voting trust or

shareholders' agreement to ten (10) years is not applicable to a close corporation that complies

with subsection (a). If close corporation status is terminated pursuant to subsection (d), the

effective term of voting trust or shareholders' agreement shall be ten (10) years from the

termination or the term provided in the voting trust or shareholders' agreement, whichever is

shorter.

      (c) The effect of any provision authorized by subsection (a) (1) is to relieve the directors

and to impose on the person or persons undertaking to exercise responsibility the liability for

managerial acts or omissions that would otherwise be imposed on directors to the extent that and

so long as the discretion or powers of the board in its management of corporate affairs is

controlled by the provision. Action which is valid pursuant to subsection (a) (1) is deemed to be

action by the board of directors for purposes of compliance with any provision of this chapter

providing for action by the board of directors.

      (d) (1) The articles of incorporation shall be amended to terminate close corporation

status pursuant to this section if:

      (A) All of the shareholders, or a lesser number is specified in the articles of

incorporation, the bylaws, or an agreement relating to the corporation, approve the termination; or

      (B) There are more than thirty (30) shareholders of record and any shareholder, after

thirty (30) days' notice to the corporation of his or her intention to do so during which time the

number is not reduced to thirty (30) or less, demands termination; or

      (C) Any person who acquires record shares of the corporation without notice or

knowledge of its close corporation status demands termination; provided, that notice is

conclusively presumed if certificates representing the shares so acquired state on their face, under

the name of the corporation, that it is a close corporation pursuant to this section.

      (2) If the directors and shareholders fail to effect the amendment promptly, the superior

court has jurisdiction to enter whatever order is necessary to effect the amendment. The

termination does not affect the validity of any provision relating to the corporation or its

management which would be valid, notwithstanding the provisions of this section.

     7-1.1-52. Organization meeting of directors. -- After the issuance of the certificate of

incorporation an organization meeting of the board of directors named in the articles of

incorporation shall be held, either within or without this state, at the call of a majority of the

directors named in the articles of incorporation, for the purpose of adopting bylaws, electing

officers, and the transaction of any other business that may come before the meeting. The

directors calling the meeting shall give at least three (3) days' notice of the meeting by mail to

each director named, which notice shall state the time and place of the meeting.

     7-1.1-53. Right to amend articles of incorporation. -- (a) A corporation may amend its

articles of incorporation, from time to time, in any and as many respects as is desired, so long as

its articles of incorporation, as amended, contain only provisions that might be lawfully contained

in original articles of incorporation at the time of making the amendment, and, if a change in

shares or the rights of shareholders, or an exchange, reclassification, or cancellation of shares or

rights of shareholders is to be made, the provisions that may be necessary to effect the change,

exchange, reclassification, or cancellation.

      (b) In particular, and without limitation upon the general power of amendment, a

corporation may amend its articles of incorporation, from time to time, so as to:

      (1) Change its corporate name.

      (2) Change its period of duration.

      (3) Change, enlarge, or diminish its corporate purposes.

      (4) Increase or decrease the aggregate number of shares, or shares of any class, which the

corporation has authority to issue.

      (5) Increase or decrease the par value of the authorized shares of any class having a par

value, whether issued or unissued.

      (6) Exchange, classify, reclassify, or cancel all or any part of its shares, whether issued

or unissued.

      (7) Change the designation of all or any part of its shares, whether issued or unissued,

and to change the preferences, limitations, and relative rights in respect of all or any part of its

shares, whether issued or unissued.

      (8) Change shares having a par value, whether issued or unissued, into the same or a

different number of shares without par value, and to change shares without par value, whether

issued or unissued, into the same or a different number of shares having a par value.

      (9) Change the shares of any class, whether issued or unissued, and whether with or

without par value, into a different number of shares of the same class or into the same or a

different number of shares, either with or without par value, of other classes.

      (10) Create new classes of shares having rights and preferences either prior and superior

or subordinate and inferior to the shares of any class then authorized, whether issued or unissued.

      (11) Cancel or otherwise affect the right of the holders of the shares of any class to

receive dividends which have accrued but have not been declared.

      (12) Divide any preferred or special class of shares, whether issued or unissued, into

series and fix and determine the designations of the series and the variation in the relative rights

and preferences as between the shares of the series.

      (13) Authorize the board of directors to establish, out of authorized but unissued shares,

series of any preferred or special class of shares and fix and determine the relative rights and

preferences of the shares of any series so established.

      (14) Authorize the board of directors to fix and determine the relative rights and

preferences of the authorized but unissued shares of series previously established, in respect of

which either the relative rights and preferences have not been fixed and determined or the relative

rights and preferences previously fixed and determined are to be changed.

      (15) Revoke, diminish, or enlarge the authority of the board of directors to establish

series out of authorized but unissued shares of any preferred or special class and fix and

determine the relative rights and preferences of the shares of any series so established.

      (16) Limit, deny, or grant to shareholders of any class the preemptive right to acquire

additional or treasury shares of the corporation, whether then or subsequently authorized.

     7-1.1-53.1. Right to amend legislative charters. -- Any corporation created by special

act of the general assembly, which is organized under this chapter, whose charter is subject to

amendment or repeal at the will of the general assembly, may make any amendment to its charter

that corporations organized under the provisions of this chapter may make to their articles of

incorporation under section 7-1.1-53; and the proposed amendment shall be effected and

evidenced in the same manner, by the same vote and upon the same terms and conditions as are

prescribed in sections 7-1.1-54 and 7-1.1-55.

     7-1.1-54. Procedure to amend articles of incorporation. -- (a) Amendments to the

articles of incorporation are made in the following manner:

      (1) The board of directors adopts a resolution setting forth the proposed amendment and

directing that it be submitted to a vote at a meeting of shareholders, which may be either the

annual or a special meeting. If no shares have been issued, the amendment is adopted by

resolution of the board of directors and the provisions subsequently stated for adoption by

shareholders do not apply. The resolution may incorporate the proposed amendment in restated

articles of incorporation which contain a statement that, except for the designated amendment, the

restated articles of incorporation correctly state without change the corresponding provisions of

the articles of incorporation as previously amended, and that the restated articles of incorporation,

together with the designated amendment, supersede the original articles of incorporation and all

amendments to those articles.

      (2) Written notice stating the proposed amendment or a summary of the changes to be

affected by the amendment shall be given to each shareholder of record entitled to vote on the

amendment within the time and in the manner provided in this chapter for the giving of notice of

meetings of shareholders. If the meeting is an annual meeting, the proposed amendment or the

summary may be included in the notice of the annual meeting.

      (3) At the meeting a vote of the shareholders entitled to vote on the amendment shall be

taken on the proposed amendment. The proposed amendment is adopted upon receiving the

affirmative vote of the holders of a majority of the shares entitled to vote on the amendment

unless any class of shares is entitled to vote on the amendment as a class, pursuant to either the

articles of incorporation or the provisions of section 7-1.1-55, in which event approval of the

proposed amendment also requires the affirmative vote of the holders of a majority of the shares

of each class of shares entitled to vote as a class on the amendment.

      (b) Any number of amendments may be submitted to the shareholders, and voted upon

by them, at one meeting.

      (c) The resolution authorizing a proposed amendment to the certificate of incorporation

may provide that at any time prior to the filing of the amendment with the secretary of state,

notwithstanding authorization of the proposed amendment by the stockholders of the corporation

or by the members of a nonstock corporation, the board of directors or governing body may

abandon the proposed amendment without further action by the stockholders or members.

     7-1.1-55. Class voting on amendments. -- (a) Except as otherwise provided in this

section, the holders of the outstanding shares of a class are entitled to vote as a class upon a

proposed amendment, whether or not entitled to vote on the amendment by the provisions of the

articles of incorporation, if the amendment would:

      (1) Increase or decrease the aggregate number of authorized shares of the class.

      (2) Increase or decrease the par value of the shares of the class.

      (3) Effect an exchange, reclassification, or cancellation of all or part of the shares of the

class.

      (4) Effect an exchange, or create a right of exchange, of all or any part of the shares of

another class into the shares of the class.

      (5) Change the designations, preferences, limitations, or relative rights of the shares of

the class.

      (6) Change the shares of the class, whether with or without par value, into the same or a

different number of shares, either with or without par value, of the same class or another class or

classes.

      (7) Create a new class of shares having rights and preferences prior and superior to the

shares of the class, or increase the rights and preferences or the number of authorized shares of

any class having rights and preferences prior or superior to the shares of the class.

      (8) In the case of a preferred or special class of shares, divide the shares of the class into

series and fix and determine the designation of the series and the variations in the relative rights

and preferences between the shares of the series, or authorize the board of directors to do so.

      (9) Limit or deny any existing preemptive rights of the shares of the class.

      (10) Cancel or otherwise affect dividends on the shares of the class which have accrued

but have not been declared.

      (b) If the proposed amendment would affect only the shares of one series of a class and

not the entire class, then only the shares of the series so affected is considered a separate class for

the purpose of this section. Any class and any series within a class is considered a separate class

for purposes of this section if the effect of the proposed amendment upon the class or series

would be different than the effect of the amendment upon the other classes or other series within

the class. If the proposed amendment would affect two (2) or more classes or series within a class

in the same way but would not affect the remaining classes or series within the class in the same

way, the two (2) or more classes or series affected in the same way are together considered a

separate class for purposes of this section. Except as otherwise provided in the articles of

incorporation or the certificate referred to in section 7-1.1-15(g), if the proposed amendment

would have no effect upon one or more classes or series of a class, the classes or series are not

entitled to any vote on the proposed amendment and, for the purposes of this section, are not

counted in determining the number of shares constituting the class.

     7-1.1-56. Articles of amendment. -- The articles of amendment shall be executed in

duplicate by the corporation by its president or a vice president and by its secretary or an assistant

secretary, and verified by one of the officers signing the articles, and shall state:

      (1) The name of the corporation.

      (2) The amendment so adopted.

      (3) The date of the adoption of the amendment by the shareholders or by the board of

directors where no shares have been issued.

      (4) The number of shares outstanding, and the number of shares entitled to vote on the

amendment, and if the shares of any class are entitled to vote on the amendment as a class, the

designation and number of outstanding shares entitled to vote on the amendment of each class.

      (5) The number of shares voted for and against the amendment, respectively, and, if the

shares of any class are entitled to vote on the amendment as a class, the number of shares of each

class voted for and against the amendment, respectively, or if no shares have been issued, a

statement to that effect.

      (6) If the amendment provides for an exchange, reclassification, or cancellation of issued

shares, and if the manner in which that shall be effected is not set forth in the amendment, then a

statement of the manner in which the exchange, reclassification, or cancellation of issued shares

shall be effected.

      (7) If the amendment effects a change in the amount of stated capital, then a statement of

the manner in which the change is effected and a statement, expressed in dollars, of the amount of

stated capital as changed by the amendment.

      (8) If, pursuant to section 7-1.1-58, the amendment is to become effective at a time

subsequent to the issuance of the certificate of amendment by the secretary of state, the date when

the amendment is to become effective.

     7-1.1-57. Filing of articles of amendment. -- (a) Duplicate originals of the articles of

amendment shall be delivered to the secretary of state. If the secretary of state finds that the

articles of amendment conform to law, he or she shall, when all fees and franchise taxes have

been paid:

      (1) Endorse on each of the duplicate originals the word "Filed," and the month, day, and

year of the filing.

      (2) File one of the duplicate originals in his or her office.

      (3) Issue a certificate of amendment to which he or she affixes the other duplicate

original.

      (b) The certificate of amendment, together with the duplicate original of the articles of

amendment affixed to it by the secretary of state, shall be returned to the corporation or its

representative.

     7-1.1-58. Effect of certificate of amendment. -- (a) Upon the issuance of the certificate

of amendment by the secretary of state or upon a later date, not more than thirty (30) days after

the filing of the articles of amendment, as stated in the articles, the amendment becomes effective

and the articles of incorporation are deemed to be amended accordingly.

      (b) No amendment affects any existing cause of action in favor of or against the

corporation, or any pending suit to which the corporation is a party, or the existing rights of

persons other than shareholders; and, in the event the corporate name is changed by amendment,

no suit brought by or against the corporation under its former name abates for that reason.

     7-1.1-59. Restated articles of incorporation. -- (a) A domestic corporation may at any

time restate its articles of incorporation as previously amended, by a resolution adopted by the

board of directors.

      (b) Upon the adoption of a resolution, restated articles of incorporation shall be executed

in duplicate by the corporation by its president or a vice president and by its secretary or assistant

secretary and verified by one of the officers signing the articles and shall state all of the

provisions of the articles of incorporation, as previously amended, together with a statement that

the restated articles of incorporation correctly set forth without change the corresponding

provisions of the articles of incorporation, as previously amended, and that the restated articles of

incorporation supersede the original articles of incorporation and all amendments to the articles.

      (c) Duplicate originals of the restated articles of incorporation shall be delivered to the

secretary of state. If the secretary of state finds that the restated articles of incorporation conform

to law, he or she shall, when all fees and franchise taxes have been paid:

      (1) Endorse on each of the duplicate originals the word "Filed," and the month, day, and

year of the filing.

      (2) File one of the duplicate originals in his or her office.

      (3) Issue a restated certificate of incorporation, to which he or she affixes the other

duplicate original.

      (d) The restated certificate of incorporation, together with the duplicate original of the

restated articles of incorporation affixed to it by the secretary of state, shall be returned to the

corporation or its representative.

      (e) Upon the issuance of the restated certificate of incorporation by the secretary of state

or upon a later date, not more than thirty (30) days after the filing of the restated articles of

incorporation, as stated in the articles, the restated articles of incorporation become effective and

supersede the original articles of incorporation and all amendments to those articles.

     7-1.1-59.1. Amendment of articles of incorporation in reorganization proceedings. --

(a) Whenever a plan of reorganization of a corporation has been confirmed by decree or order of

a court of competent jurisdiction in proceedings for the reorganization of the corporation,

pursuant to the provisions of any applicable statute of the United States relating to reorganizations

of corporations, the articles of incorporation of the corporation may be amended, in the manner

provided in this section, in as many respects as are necessary to carry out the plan and put into

effect, as long as the articles of incorporation, as amended, contain only provisions that might be

lawfully contained in original articles of incorporation at the time of making the amendment.

      (b) In particular and without limitation upon the general power of amendment, the

articles of incorporation may be amended for that purpose so as to:

      (1) Change the corporate name, period of duration, or corporate purposes of the

corporation;

      (2) Repeal, alter, or amend the bylaws of the corporation;

      (3) Change the aggregate number of shares, or shares of any class, which the corporation

has authority to issue;

      (4) Change the preferences, limitations, and relative rights in respect of all or any part of

the shares of the corporation, and classify, reclassify, or cancel all or any part of the shares,

whether issued or unissued;

      (5) Authorize the issuance of bonds, debentures, or other obligations of the corporation,

whether or not convertible into shares of any class or bearing warrants or other evidences of

optional rights to purchase or subscribe for shares of any class, and fix the terms and conditions

of them; and

      (6) Constitute or reconstitute and classify or reclassify the board of directors of the

corporation, and appoint directors and officers in place of or in addition to all or any of the

directors or officers then in office.

      (c) Amendments to the articles of incorporation pursuant to this section shall be made in

the following manner:

      (1) Articles of amendment approved by decree or order of the court shall be executed

and verified in duplicate by the person or persons that the court designates or appoints for the

purpose, and shall state the name of the corporation, the amendments of the articles of

incorporation approved by the court, the date of the decree or order approving the articles of

amendment, the title of the proceedings in which the decree or order was entered, and a statement

that the decree or order was entered by a court having jurisdiction of the proceedings for the

reorganization of the corporation pursuant to the provisions of an applicable statute of the United

States.

      (2) Duplicate originals of the articles of amendment shall be delivered to the secretary of

state. If the secretary of state finds that the articles of amendment conform to law, he or she shall,

when all fees and franchise taxes have been paid:

      (i) Endorse on each of the duplicate originals the word "Filed", and the month, day, and

year of the filing.

      (ii) File one of the duplicate originals in his or her office.

      (iii) Issue a certificate of amendment to which he or she affixes the other duplicate

original.

      (d) The certificate of amendment, together with the duplicate original of the articles of

amendment affixed to it by the secretary of state, shall be returned to the corporation or its

representative.

      (e) The amendment becomes effective upon the issuance of the certificate of amendment

by the secretary of state, or upon a later date, not more than thirty (30) days subsequent to the

filing of the amendments with the secretary of state, as is provided for in the articles of

amendment without any action on the amendment by the directors or shareholders of the

corporation and with the same effect as if the amendments had been adopted by unanimous action

of the directors and shareholders of the corporation.

     7-1.1-60. Restriction on redemption or purchase of redeemable shares. -- No

redemption or purchase of redeemable shares shall be made by a corporation when it is insolvent

or when the redemption or purchase would render it insolvent, or which would reduce the net

assets below the aggregate amount payable to the holders of shares having prior or equal rights to

the assets of the corporation upon involuntary dissolution.

     7-1.1-61. Cancellation of redeemable shares by redemption or purchase. -- (a) When

redeemable shares of a corporation are redeemed or purchased by the corporation, the redemption

or purchase effects a cancellation of the shares, and a statement of cancellation shall be filed as

provided in this section. Thereupon the shares are restored to the status of authorized but unissued

shares, unless the articles of incorporation provide that the shares, when redeemed or purchased,

are not to be reissued, in which case the filing of the statement of cancellation constitutes an

amendment to the articles of incorporation and reduces the number of shares of the class

cancelled which the corporation is authorized to issue by the number of shares cancelled.

      (b) The statement of cancellation shall be executed in duplicate by the corporation by its

president or a vice president and by its secretary or an assistant secretary, and verified by one of

the officers signing the statement, and shall state:

      (1) The name of the corporation.

      (2) The number of redeemable shares cancelled through redemption or purchase,

itemized by classes and series.

      (3) The aggregate number of issued shares, itemized by classes and series, after giving

effect to the cancellation.

      (4) If the articles of incorporation provide that the cancelled shares are not to be reissued,

then the number of shares which the corporation has authority to issue, itemized by classes and

series, after giving effect to the cancellation.

      (c) Duplicate originals of the statement shall be delivered to the secretary of state. If the

secretary of state finds that the statement conforms to law, the secretary of state shall, when all

fees and franchise taxes have been paid:

      (1) Endorse on each of the duplicate originals the word "Filed", and the month, day, and

year of the filing.

      (2) File one of the duplicate originals in his or her office.

      (3) Return the other duplicate original to the corporation or its representative.

      (d) Upon the filing of the statement of cancellation, the stated capital of the corporation

is deemed to be reduced by that part of the stated capital which was, at the time of the

cancellation, represented by the shares cancelled.

      (e) Nothing contained in this section is construed to forbid a cancellation of shares or a

reduction of stated capital in any other manner permitted by this chapter.

     7-1.1-62. Cancellation of other reacquired shares. -- (a) A corporation may at any

time, by resolution of its board of directors, cancel all or any part of the shares of the corporation

of any class reacquired by it, other than redeemable shares redeemed or purchased, and in that

event a statement of cancellation shall be filed as provided in this section.

      (b) The statement of cancellation shall be executed in duplicate by the corporation by its

president or a vice president and by its secretary or an assistant secretary, and verified by one of

the officers signing the statement, and shall state

      (1) The name of the corporation.

      (2) The number of reacquired shares cancelled by resolution duly adopted by the board

of directors, itemized by classes and series, and the date of its adoption.

      (3) The aggregate number of issued shares, itemized by classes and series, after giving

effect to the cancellation.

      (c) Duplicate originals of the statement shall be delivered to the secretary of state. If the

secretary of state finds that the statement conforms to law, the secretary of state shall, when all

fees and franchise taxes have been paid:

      (1) Endorse on each of the duplicate originals the word "Filed," and the month, day, and

year of the filing.

      (2) File one of the duplicate originals in his or her office.

      (3) Return the other duplicate original to the corporation or its representative.

      (d) Upon the filing of the statement of cancellation, the stated capital of the corporation

is deemed to be reduced by that part of the stated capital which was, at the time of the

cancellation, represented by the cancelled shares, and the cancelled shares are restored to the

status of authorized but unissued shares.

      (e) Nothing contained in this section is construed to forbid a cancellation of shares or a

reduction of stated capital in any other manner permitted by this chapter.

     7-1.1-63. Reduction of stated capital in certain cases. -- (a) A reduction in the stated

capital of a corporation which does not involve either an amendment of the articles of

incorporation or a cancellation of shares may be made in the following manner:

      (1) The board of directors adopts a resolution stating the amount of the proposed

reduction and the manner in which the reduction is to be effected, and directing that the question

of the reduction be submitted to a vote at a meeting of shareholders, which may be either an

annual or a special meeting.

      (2) Written notice, stating that the purpose or one of the purposes of the meeting is to

consider the question of reducing the stated capital of the corporation in the amount and manner

proposed by the board of directors, shall be given to each shareholder of record entitled to vote on

the reduction of stated capital within the time and in the manner provided in this chapter for the

giving of notice of meetings of shareholders.

      (3) At the meeting a vote of the shareholders entitled to vote on the reduction of stated

capital shall be taken on the question of approving the proposed reduction of stated capital, which

requires for its adoption the affirmative vote of the holders of a majority of the shares entitled to

vote on the question.

      (b) No reduction of stated capital shall be made under the provisions of this section

which would reduce the amount of the aggregate stated capital of the corporation to an amount

equal to or less than the aggregate preferential amounts payable upon all issued shares having a

preferential right in the assets of the corporation in the event of involuntary liquidation, plus the

aggregate par value of all issued shares having a par value but no preferential right in the assets of

the corporation in the event of involuntary liquidation.

     7-1.1-64. Creation and application of surplus and reserves. -- (a) The surplus created

by or arising out of a reduction of the stated capital of a corporation is capital surplus.

      (b) The capital surplus of a corporation may be increased from time to time by resolution

of the board of directors directing that all or a part of the earned surplus of the corporation is

transferred to capital surplus.

      (c) A corporation may, by resolution of its board of directors, apply any part or all of its

capital surplus to the reduction or elimination of any deficit arising from losses, however

incurred, but only after first eliminating the earned surplus, if any, of the corporation by applying

the losses against earned surplus and only to the extent that the losses exceed the earned surplus,

if any. Each application of capital surplus shall, to the extent of the application, effect a reduction

of capital surplus.

      (d) A corporation may, by resolution of its board of directors, create a reserve or reserves

out of its earned surplus for any proper purpose or purposes, and may abolish any reserve in the

same manner. Earned surplus of the corporation, to the extent so reserved, is not available for the

payment of dividends or other distributions by the corporation except as expressly permitted by

this chapter.

     7-1.1-65. Procedure for merger. -- (a) Any two (2) or more domestic corporations may

merge into one of the corporations pursuant to a plan of merger approved in the manner provided

in this chapter.

      (b) The board of directors of each corporation shall, by resolution adopted by each

board, approve a plan of merger stating:

      (1) The names of the corporations proposing to merge, and the name of the corporation

into which they propose to merge, which is hereinafter designated as the surviving corporation.

      (2) The terms and conditions of the proposed merger.

      (3) The manner and basis of converting the shares of each merging corporation (other

than those held by the surviving corporation) into shares or obligations or other securities of the

surviving corporation or, in whole or in part, into cash, property, or shares, obligations, or other

securities of any other corporation.

      (4) A statement of any changes in the articles of incorporation of the surviving

corporation to be effected by the merger, or if no changes are desired, a statement that the articles

of incorporation of one of the corporations are the articles of incorporation of the surviving

corporation.

      (5) Any other provisions with respect to the proposed merger that are deemed necessary

or desirable.

     7-1.1-66. Procedure for consolidation. -- (a) Any two (2) or more domestic corporations

may consolidate into a new corporation pursuant to a plan of consolidation approved in the

manner provided in this chapter.

      (b) The board of directors of each corporation shall, by a resolution adopted by each

board, approve a plan of consolidation stating:

      (1) The names of the corporations proposing to consolidate, and the name of the new

corporation into which they propose to consolidate, which is subsequently designated as the new

corporation.

      (2) The terms and conditions of the proposed consolidation.

      (3) The manner and basis of converting the shares of each corporation into shares or

obligations or other securities of the new corporation or, in whole or in part, into cash, property,

or shares, obligations, or other securities of any other corporation.

      (4) With respect to the new corporation, all of the statements required to be stated in

articles of incorporation for corporations organized under this chapter.

      (5) Any other provisions with respect to the proposed consolidation that are deemed

necessary or desirable.

     7-1.1-67. Approval by shareholders of merger or consolidation. -- (a) The board of

directors of each corporation, upon approving the plan of merger or plan of consolidation, shall,

by resolution, direct that the plan be submitted to a vote at a meeting of shareholders, which may

be either an annual or a special meeting. Written notice shall be given to each shareholder of

record, whether or not entitled to vote at the meeting, not less than twenty (20) days before the

meeting, in the manner provided in this chapter for the giving of notice of meetings of

shareholders, and, whether the meeting is an annual or a special meeting, shall state that the

purpose or one of the purposes is to consider the proposed plan of merger or consolidation. A

copy or a summary of the plan of merger or the agreement of consolidation, as the case may be,

together with a statement of the stockholder's right to dissent and a copy or a summary of section

7-1.1-74, shall be included in or enclosed with the notice except where no such right is available.

      (b) At each meeting, a vote of the shareholders shall be taken on the proposed plan of

merger or consolidation. The plan of merger or consolidation is be approved upon receiving the

affirmative vote of the holders of a majority of the shares entitled to vote on the plan of merger or

consolidation of each corporation, unless any class of shares of any corporation is entitled to vote

as a class on it, in which event, as to the corporation, approval of the plan of merger or

consolidation also requires the affirmative vote of the holders of a majority of the shares of each

class of shares entitled to vote as a class on it. Any class of shares of the surviving corporation

and the merged corporation in a merger is entitled to vote as a class, whether or not the class is

otherwise entitled to vote, if the plan of merger contains any provision which, if contained in a

proposed amendment to articles of incorporation, would entitle the class of shares to a class vote.

      (c) (1) Notwithstanding the foregoing provisions of this section, except as may be

required by the articles of incorporation, no approval of a plan of merger by the stockholders of

the surviving corporation in a merger, and no notice to any of the stockholders of the corporation,

are required if:

      (i) The plan of merger does not amend the articles of incorporation of the corporation;

and

      (ii) The plan of merger does not involve the issuance or transfer by the corporation

(either directly or through the medium of options or warrants for, or shares or debt instruments

convertible within one year into, the shares) of shares possessing more than one-third ( 1/3) of the

total combined voting power of all classes of stock then entitled to vote for the election of

directors which will be outstanding immediately after the merger.

      (2) If a plan of merger is adopted by the surviving corporation in a merger without any

approval by its shareholders, pursuant to the provisions of this subsection, that fact shall be

certified in the articles of merger.

      (d) After approval as already stated by each corporation, and at any time prior to the

filing of the articles of merger or consolidation, the merger or consolidation may be abandoned

pursuant to provisions for abandonment, if any, set forth in the plan of merger or consolidation.

      (e) Except as otherwise expressly provided in this chapter, the provisions and

requirements of this section and section 7-1.1-73(a)(1) do not apply to any transaction unless

articles of merger or consolidation have been filed in connection with the transaction under

section 7-1.1-68.

     7-1.1-68. Articles of merger or consolidation. -- (a) Upon approval, articles of merger

or articles of consolidation shall be executed in duplicate by each corporation by its president or a

vice president and by its secretary or an assistant secretary, and verified by one of the officers of

each corporation signing the articles, and shall state:

      (1) The plan of merger or the plan of consolidation.

      (2) As to each corporation (except one whose shareholders are not required to approve

the agreement under section 7-1.1-67, in which event that fact shall be stated), the total number of

shares outstanding entitled to vote on the plan, respectively, and, if the shares of any class are

entitled to vote on the plan as a class, the designation and number of outstanding shares of each

class, and the number of shares of each class voted for and against the plan, respectively.

      (3) If, pursuant to section 7-1.1-69, the merger or consolidation is to become effective at

a time subsequent to the issuance of the certificate of merger or the certificate of consolidation by

the secretary of state, the date when the merger or consolidation is to become effective.

      (b) Duplicate originals of the articles of merger or articles of consolidation shall be

delivered to the secretary of state. If the secretary of state finds that the articles conform to law,

he or she shall, when all fees and franchise taxes have been paid:

      (1) Endorse on each of the duplicate originals the word "Filed," and the month, day, and

year of the filing.

      (2) File one of the duplicate originals in his or her office.

      (3) Issue a certificate of merger or a certificate of consolidation to which he or she

affixes the other duplicate original.

      (c) The certificate of merger or certificate of consolidation, together with the duplicate

original of the articles of merger or articles of consolidation affixed to it by the secretary of state,

shall be returned to the surviving or new corporation, as the case may be, or its representative.

     7-1.1-68.1. Merger of subsidiary corporation. -- (a) Any corporation owning at least

ninety percent (90%) of the outstanding shares of each class of another corporation may merge

the other corporation into itself without approval by a vote of the shareholders of either

corporation. Its board of directors shall, by resolution, approve a plan of merger stating:

      (1) The name of the subsidiary corporation and the name of the corporation owning at

least ninety percent (90%) of its shares, which is subsequently in these provisions designated as

the surviving corporation.

      (2) The manner and basis of converting the shares of the subsidiary corporation (other

than those held by the surviving corporation) into shares or other securities or obligations of the

surviving corporation or of any other corporation, or in whole or in part, into cash or other

consideration to be paid upon the surrender of each share of the subsidiary corporation.

      (b) A copy of the plan of merger shall be mailed to each shareholder of record of the

subsidiary corporation.

      (c) Articles of merger shall be executed in duplicate by the surviving corporation by its

president or a vice president and by its secretary or an assistant secretary, and verified by one of

its officers signing the articles, and shall state:

      (1) The plan of merger;

      (2) The number of outstanding shares of each class of the subsidiary corporation and the

number of the shares of each class owned by the surviving corporation; and

      (3) The date of the mailing to shareholders of the subsidiary corporation of a copy of the

plan of merger.

      (4) If, pursuant to section 7-1.1-69, the merger is to become effective at a time

subsequent to the issuance of the certificate of merger by the secretary of state, the date when the

merger is to become effective.

      (d) On and after the thirtieth day after the mailing of a copy of the agreement of merger

to shareholders of the subsidiary corporation or upon the waiver of the mailing by the holders of

all outstanding shares, duplicate originals of the articles of merger shall be delivered to the

secretary of state. If the secretary of state finds that the articles conform to law, the secretary of

state shall, when all fees and franchise taxes have been paid:

      (1) Endorse on each of the duplicate originals the word "Filed," and the month, day, and

year of the filing;

      (2) File one of the duplicate originals in his or her office, and

      (3) Issue a certificate of merger to which he or she affixes the other duplicate original.

      (e) The certificate of merger, together with the duplicate original of the articles of merger

affixed to it by the secretary of state, shall be returned to the surviving corporation or its

representative.

     7-1.1-69. Effect of merger or consolidation. -- (a) A merger or consolidation becomes

effective upon the issuance of a certificate of merger or the certificate of consolidation by the

secretary of state or on a later date, not more than thirty (30) days after the filing of the articles of

merger or the articles of consolidation, as is stated in the plan.

      (b) When a merger or consolidation becomes effective:

      (1) The several corporations, parties to the plan of merger or consolidation, are a single

corporation, which, in the case of a merger, is that corporation designated in the plan of merger as

the surviving corporation, and, in the case of a consolidation, is the new corporation provided for

in the plan of consolidation.

      (2) The separate existence of all corporations, parties to the plan of merger or

consolidation, except the surviving or new corporation, ceases.

      (3) The surviving or new corporation has all the rights, privileges, immunities, and

powers and is subject to all the duties and liabilities of a corporation organized under this chapter.

      (4) The surviving or new corporation at that time and subsequently possesses all the

rights, privileges, immunities, and franchises, as well of a public as of a private nature, of each of

the merging or consolidating corporations; and all property, real, personal, and mixed, all debts

due on whatever account, including subscriptions to shares, all other choses in action, and all and

every other interest of or belonging to or due to each of the corporations merged or consolidated,

is taken and deemed to be transferred to and vested in the single corporation without further act or

deed; and the title to any real estate, or any interest in real estate, vested in any of the corporations

does not revert or is in any way impaired because of the merger or consolidation.

      (5) The surviving or new corporation is subsequently responsible and liable for all the

liabilities and obligations of each of the corporations merged or consolidated; and any claim

existing or action or proceeding pending by or against any of the corporations may be prosecuted

as if the merger or consolidation had not taken place, or the surviving or new corporation may be

substituted in its place. Neither the rights of creditors nor any liens upon the property of any

corporation is impaired by the merger or consolidation.

      (6) In the case of a merger, the articles of incorporation of the surviving corporation are

deemed to be amended to the extent, if any, that changes in its articles of incorporation are stated

in the plan of merger; and, in the case of consolidation, the statements in the articles of

consolidation and which are required or permitted to be stated in the articles of incorporation of

corporations organized under this chapter are deemed to be the original articles of incorporation

of the new corporation.

      (7) The shares of the corporation or corporations party to the plan that are, under the

terms of the plan, to be converted or exchanged, cease to exist, and the holders of the shares are

entitled only to the shares, obligations, other securities, cash, or other property into which they

have been converted or for which they have been exchanged in accordance with the plan, subject

to any rights under section 7-1.1-73.

     7-1.1-70. 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

in the following manner, if the merger or consolidation is permitted by the laws of the state under

which each foreign corporation is organized:

      (1) Each domestic corporation shall comply with the provisions of this chapter with

respect to the merger or consolidation, as the case may be, of domestic corporations, and each

foreign corporation shall comply with the applicable provisions of the laws of the state under

which it is organized.

      (2) If the surviving or new corporation, as the case may be, is to be governed by the laws

of any state other than this state, it shall comply with the provisions of this chapter with respect to

foreign corporations if it is to transact business in this state, and in every case it shall file with the

secretary of state of this state:

      (i) An agreement that it may be served with process in this state in any proceeding for

the enforcement of any obligation of any domestic corporation which is a party to the merger or

consolidation and in any proceeding for the enforcement of the rights of a dissenting shareholder

of any domestic corporation against the surviving or new corporation;

      (ii) An irrevocable appointment of the secretary of state of this state as its agent to accept

service of process in any proceeding; and

      (iii) An agreement that it will promptly pay to the dissenting shareholders of any

domestic corporation the amount, if any, to which they are entitled under the provisions of this

chapter regarding the rights of dissenting shareholders.

      (b) The effect of the merger or consolidation is the same as in the case of the merger or

consolidation of domestic corporations, if the surviving or new corporation is to be governed by

the laws of this state. If the surviving or new corporation is to be governed by the laws of any

state other than this state, the effect of the merger or consolidation is the same as in the case of

the merger or consolidation of domestic corporations except insofar as the laws of the other state

provide otherwise.

      (c) At any time prior to the filing of the articles of merger or consolidation, the merger or

consolidation may be abandoned pursuant to provisions for abandonment, if any, stated in the

plan of merger or consolidation.

     7-1.1-70.1. Shareholder approval of certain acquisitions. -- Before any domestic

corporation acquires, directly or through a subsidiary, either:

      (1) All or substantially all of the assets of one or more corporations, with or without

good will or the assumption of liabilities, or

      (2) Shares of one or more corporations possessing two-thirds ( 2/3) or more of the total

combined voting power of all classes of stock of the acquired corporation or corporations entitled

at that time to vote for the election of directors, for a consideration which includes (either directly

or through the medium of options or warrants for, or shares or debt instruments convertible within

one year into, those shares) shares of the acquiring corporation possessing more than one-third (

1/3) of the total combined voting power of all classes of stock of the acquiring corporation

entitled at that time to vote for the election of directors which will be outstanding immediately

after the acquisition, the acquisition shall be approved by the shareholders of the acquiring

corporation pursuant to the terms and conditions of section 7-1.1-67 applicable to the surviving

corporation in a merger.

     7-1.1-71. Sale of assets in regular course of business and mortgage or pledge of

assets. -- The sale, lease, exchange, or other disposition of all, or substantially all, the property

and assets of a corporation in the usual and regular course of its business, and the mortgage or

pledge of any or all property and assets of a corporation, whether or not in the usual and regular

course of business, may be made upon terms and conditions and for any consideration, which

may consist in whole or in part of money or property, real or personal, including shares of any

other corporation, domestic or foreign, as is authorized by its board of directors; and in any case

no authorization or consent of the shareholders is required.

     7-1.1-72. Sale of assets other than in regular course of business. -- A sale, lease,

exchange, or other disposition of all, or substantially all, the property and assets, with or without

the good will, of a corporation, if not in the usual and regular course of its business, may be made

upon terms and conditions and for any consideration, which may consist in whole or in part of

money or property, real or personal, including shares of any other corporation, domestic or

foreign, as is authorized in the following manner:

      (1) The board of directors adoption of a resolution recommending the sale, lease,

exchange, or other disposition, and directing the submission of the resolution to a vote at a

meeting of shareholders, which may be either an annual or a special meeting.

      (2) Written notice shall be given to each shareholder of record, whether or not entitled to

vote at the meeting, not less than twenty (20) days before the meeting, in the manner provided in

this chapter for the giving of notice of meeting of shareholders, and, whether the meeting is an

annual or a special meeting, shall state that the purpose, or one of the purposes, is to consider the

proposed sale, lease, exchange, or other disposition. A statement of the stockholder's right to

dissent and a copy or summary of section 7-1.1-74 shall be included in or enclosed with the

notice.

      (3) At the meeting the shareholders may authorize the sale, lease, exchange, or other

disposition and may fix, or may authorize the board of directors to fix, any or all of the terms and

conditions of it and the consideration to be received by the corporation for it. The authorization

requires the affirmative vote of the holders of a majority of the shares of the corporation entitled

to vote on the authorization, unless any class of shares is entitled to vote on it as a class, pursuant

to the articles of incorporation, in which event approval of the resolution also requires the

affirmative vote of the holders of a majority of the shares of each class of shares entitled to vote

as a class on the resolution.

      (4) After the authorization by a vote of shareholders, the board of directors nevertheless,

in its discretion, may abandon the sale, lease, exchange, or other disposition of assets, subject to

the rights of third parties under any related contracts, without any further action or approval by

shareholders.

      (5) A transfer of all or substantially all of the property and assets of a corporation to (i)

one or more subsidiary corporations in which the transferor corporation owns shares possessing at

least two-thirds ( 2/3) of the total combined voting power of all classes of stock entitled to vote at

that time for election of directors, or (ii) for cash, with or without an assumption of liabilities of

the transferor corporation, after the filing of a statement of intent to dissolve pursuant to section

7-1.1-78, is governed by the provisions of section 7-1.1-71 and not by this section. The sale,

lease, exchange, or other disposition of all, or substantially all, the property and assets, with or

without the good will, of one or more subsidiaries in which the parent corporation owns shares

possessing two-thirds ( 2/3) or more of the total combined voting power of all classes of stock

entitled at that time to vote for the election of directors shall be treated as a disposition of all, or

substantially all, the property and assets of the parent corporation within the meaning of this

section if the shares of the subsidiary or subsidiaries constitute all or substantially all the property

and assets of the parent corporation.

     7-1.1-73. Right of shareholders to dissent. -- (a) Any shareholder of a corporation has

the right to dissent from any of the following corporate actions:

      (1) Any plan of merger or consolidation to which the corporation is a party, unless the

corporation is the surviving corporation in a merger and the approval of its stockholders was not

required by virtue of the provisions of either section 7-1.1-67 or section 7-1.1-68.1; or

      (2) Any acquisition which requires the approval of the shareholders under section 7-1.1-

70.1;

      (3) Any sale or exchange of all or substantially all of the property and assets of a

corporation which requires the approval of the shareholders under section 7-1.1-72.

      (b) A shareholder may not dissent as to less than all of the shares registered in his or her

name which are owned beneficially by him or her. A nominee or fiduciary may not dissent on

behalf of any beneficial owner as to less than all of the shares of the owner registered in the name

of the nominee or fiduciary.

      (c) Unless otherwise provided in the articles of incorporation of the issuing corporation,

there is no right to dissent for the holders of the shares of any class or series of stock which, on

the date fixed to determine the stockholders entitled to receive notice of the proposed transaction

(or a copy of the agreement of merger under section 7-1.1-68.1), were:

      (1) Registered on a national securities exchange or included as national market securities

in the national association of securities dealers automated quotations system or any successor

national market system; or

      (2) Held of record by not less than two thousand (2,000) stockholders.

     7-1.1-74. Rights of dissenting shareholders. -- (a) Any shareholder electing to exercise

the right of dissent shall file with the corporation, prior to or at the meeting of shareholders at

which the proposed corporate action is submitted to a vote, a written objection to the proposed

corporate action. If the proposed corporate action is approved by the required vote and the

shareholder has not voted in favor of it, the shareholder may, within ten (10) days after the date

on which the vote was taken, or if a corporation is to be merged without a vote of its shareholders

into another corporation, any of its shareholders may, within fifteen (15) days after the plan of the

merger has been mailed to the shareholders, make written demand on the corporation, or, in the

case of a merger or consolidation, on the surviving or new corporation, domestic or foreign, for

payment of the fair value of the shareholder's shares. If the proposed corporate action is effected,

the corporation shall pay to the shareholder, upon surrender of the certificate or certificates

representing the shares, the fair value of the shares as of the day prior to the date on which the

vote was taken approving the proposed corporate action, excluding any appreciation or

depreciation in anticipation of the corporate action. Any shareholder failing to make demand

within the ten (10) day period or the fifteen (15) day period, as the case may be, is bound by the

terms of the proposed corporate action. Any shareholder making the demand is thereafter only

entitled to payment as provided in this section and is not entitled to vote or to exercise any other

rights of a shareholder.

      (b) No demand may be withdrawn unless the corporation consents to it. If, however, the

demand is withdrawn upon consent, or if the proposed corporate action is abandoned or rescinded

or the shareholders revoke the authority to effect the action, or if, in the case of a merger, on the

date of the filing of the articles of merger the surviving corporation is the owner of all the

outstanding shares of the other corporations, domestic and foreign, that are parties to the merger,

or if no demand or petition for the determination of fair value by a court has been made or filed

within the time provided in this section, or if a court of competent jurisdiction determines that the

shareholder is not entitled to the relief provided by this section, then the right of the shareholder

to be paid the fair value of his or her shares ceases and his or her status as a shareholder is

restored, without prejudice to any corporate proceedings taken during the interim.

      (c) Within ten (10) days after the corporate action is effected, the corporation, or, in the

case of a merger or consolidation, the surviving or new corporation, domestic or foreign, shall

give written notice of the action to each dissenting shareholder who has made demand as

provided in these provisions, and shall make a written offer to each shareholder to pay for the

shares at a specified price deemed by the corporation to be the fair value of the shares. The notice

and offer shall be accompanied by a balance sheet of the corporation the shares of which the

dissenting shareholder holds, as of the latest available date and not more than twelve (12) months

prior to the making of the offer, and a profit and loss statement of the corporation for the twelve

(12) month period ended on the date of the balance sheet.

      (d) If within thirty (30) days after the date on which the corporate action was effected the

fair value of the shares is agreed upon between any dissenting shareholder and the corporation,

payment for the shares shall be made within ninety (90) days after the date on which the

corporate action was effected, upon surrender of the certificate or certificates representing the

shares. Upon payment of the agreed value, the dissenting shareholder ceases to have any interest

in the shares.

      (e) If within the period of thirty (30) days a dissenting shareholder and the corporation

do not agree on the matter, then the corporation, within thirty (30) days after receipt of written

request for the filing from any dissenting shareholder given within sixty (60) days after the date

on which the corporate action was effected, shall, or at its election at any time within the period

of sixty (60) days may, file a petition in any court of competent jurisdiction in the county in this

state where the registered office of the corporation is located praying that the fair value of the

shares is found and determined. If, in the case of a merger or consolidation, the surviving or new

corporation is a foreign corporation without a registered office in this state, the petition shall be

filed in the county where the registered office of the domestic corporation was last located. If the

corporation fails to institute the proceeding as provided, any dissenting shareholder may do so in

the name of the corporation. All dissenting shareholders, wherever they reside, shall be made

parties to the proceeding as an action against their shares quasi in rem. A copy of the petition

shall be served on each dissenting shareholder who is a resident of this state and shall be served

by registered or certified mail on each dissenting shareholder who is a nonresident. Service on

nonresidents shall also be made by publication as provided by law. The jurisdiction of the court is

plenary and exclusive. All shareholders who are parties to the proceeding are entitled to judgment

against the corporation for the amount of the fair value of their shares. The court may, if it so

elects, appoint one or more persons as appraisers to receive evidence and recommend a decision

on the question of fair value. The appraisers have the power and authority that is specified in the

order of their appointment or an amendment of the order. The judgment is payable only upon and

concurrently with the surrender to the corporation of the certificate or certificates representing the

shares. Upon payment of the judgment, the dissenting shareholder ceases to have any interest in

the shares.

      (f) The judgment shall include an allowance for interest at the rate of interest on

judgments in civil actions from the date on which the vote was taken on the proposed corporate

action to the date of payment.

      (g) The costs and expenses of any proceeding shall be determined by the court and

assessed against the corporation, but all or any part of the costs and expenses may be apportioned

and assessed as the court deems equitable against any or all of the dissenting shareholders who

are parties to the proceeding to whom the corporation has made an offer to pay for the shares if

the court finds that the action of the shareholders in failing to accept the offer was arbitrary or

vexatious or not in good faith. The expenses include reasonable compensation for and reasonable

expenses of the appraisers, but exclude the fees and expenses of counsel for and experts

employed by any party; but if the fair value of the shares as determined materially exceeds the

amount which the corporation offered to pay for the shares, or if no offer was made, the court in

its discretion may award to any shareholder who is a party to the proceeding a sum that the court

determines to be reasonable compensation to any expert or experts employed by the shareholder

in the proceeding.

      (h) Within twenty (20) days after demanding payment for his or her shares, each

shareholder demanding payment shall submit the certificate or certificates representing his or her

shares to the corporation for notation on the certificate that the demand has been made. His or her

failure to do so shall, at the option of the corporation, terminate his or her rights under this section

unless a court of competent jurisdiction, for good and sufficient cause shown, directs otherwise. If

shares represented by a certificate on which notation has been made are transferred, each new

certificate issued for the shares shall bear similar notation, together with the name of the original

dissenting holder of the shares, and a transferee of the shares acquires by the transfer no rights in

the corporation other than those which the original dissenting shareholder had after making

demand for payment of the fair value of the shares.

      (i) Shares acquired by a corporation pursuant to payment of the agreed value for the

shares or to payment of the judgment entered for the shares, as provided in this section, may be

held and disposed of by the corporation as in the case of other treasury shares. However, in the

case of a merger or consolidation, they may be held and disposed of as the plan of merger or

consolidation otherwise provides.

     7-1.1-75. Voluntary dissolution by incorporators. -- (a) A corporation which has not

commenced business and which has not issued any shares, may be voluntarily dissolved by its

incorporators at any time in the following manner:

      (1) Articles of dissolution are executed in duplicate by a majority of the incorporators,

and verified by them, and state:

      (i) The name of the corporation.

      (ii) The date of issuance of its certificate of incorporation.

      (iii) That none of its shares has been issued.

      (iv) That the corporation has not commenced business.

      (v) That the amount, if any, actually paid in on subscriptions for its shares, less any part

of the amount disbursed for necessary expenses, has been returned to those entitled to it.

      (vi) That no debts of the corporation remain unpaid.

      (vii) That a majority of the incorporators elect that the corporation be dissolved.

      (2) Duplicate originals of the articles of dissolution are delivered to the secretary of state.

If the secretary of state finds that the articles of dissolution conform to law, he or she shall, when

all fees and franchise taxes have been paid:

      (i) Endorse on each of the duplicate originals the word "Filed," and the month, day, and

year of the filing.

      (ii) File one of the duplicate originals in his or her office.

      (iii) Issue a certificate of dissolution to which he or she affixes the other duplicate

original.

      (b) The certificate of dissolution, together with the duplicate original of the articles of

dissolution affixed to it by the secretary of state, is returned to the incorporators or their

representative. Upon the issuance of the certificate of dissolution by the secretary of state, the

existence of the corporation ceases.

     7-1.1-76. Voluntary dissolution by consent of shareholders. -- (a) A corporation may

be voluntarily dissolved by the written consent of all of its shareholders.

      (b) Upon the execution of the written consent, a statement of intent to dissolve is

executed in duplicate by the corporation by its president or a vice president and by its secretary or

an assistant secretary, and verified by one of the officers signing the statement. The statement

proclaims:

      (1) The name of the corporation.

      (2) The names and respective addresses of its officers.

      (3) The names and respective addresses of its directors.

      (4) A copy of the written consent signed by all shareholders of the corporation.

      (5) A statement that the written consent has been signed by all shareholders of the

corporation or signed in their names by their duly authorized attorneys.

     7-1.1-77. Voluntary dissolution by act of corporation. -- A corporation may be

dissolved by the act of the corporation, when authorized in the following manner:

      (1) The board of directors adopts a resolution recommending that the corporation be

dissolved, and directing that the question of the dissolution be submitted to a vote at a meeting of

the shareholders, which may be either an annual or a special meeting.

      (2) Written notice is given to each shareholder of record entitled to vote at the meeting

within the time and in the manner provided in this chapter for the giving of notice of meetings of

shareholders, and, whether the meeting is an annual or special meeting, states that the purpose, or

one of the purposes, of the meeting is to consider the advisability of dissolving the corporation.

      (3) At the meeting a vote of shareholders entitled to vote at the meeting is taken on a

resolution to dissolve the corporation. The resolution is adopted upon receiving the affirmative

vote of the holders of a majority of the shares of the corporation entitled to vote on the resolution,

unless any class of shares is entitled to vote on the resolution as a class, in which event approval

of the resolution also requires the affirmative vote of the holders of a majority of the shares of

each class of shares entitled to vote as a class and of the total shares entitled to vote on the

resolution.

      (4) Upon the adoption of the resolution, a statement of intent to dissolve is executed in

duplicate by the corporation by its president or a vice president and by its secretary or an assistant

secretary, and verified by one of the officers signing the statement, which statement proclaims:

      (i) The name of the corporation.

      (ii) The names and respective addresses of its officers.

      (iii) The names and respective addresses of its directors.

      (iv) A copy of the resolution adopted by the shareholders authorizing the dissolution of

the corporation.

      (v) The number of shares outstanding, and, if the shares of any class are entitled to vote

as a class, the designation and number of outstanding shares of each class.

      (vi) The number of shares voted for and against the resolution, respectively, and, if the

shares of any class are entitled to vote as a class, the number of shares of each class voted for and

against the resolution, respectively.

      (vii) If, pursuant to section 7-1.1-79, the date when the corporation is to cease to carry on

its business is to be subsequent to the date of the filing, the date when the corporation is to cease

to carry on its business.

     7-1.1-78. Filing of statement of intent to dissolve. -- Duplicate originals of the

statement of intent to dissolve, whether by consent of shareholders or by act of the corporation,

shall be delivered to the secretary of state. If the secretary of state finds that the statement

conforms to law, he or she shall, when all fees and franchise taxes have been paid:

      (1) Endorse on each of the duplicate originals the word "Filed," and the month, day, and

year of the filing.

      (2) File one of the duplicate originals in his or her office.

      (3) Return the other duplicate original to the corporation or its representative.

     7-1.1-79. Effect of statement of intent to dissolve. -- Upon the filing by the secretary of

state of a statement of intent to dissolve, whether by consent of shareholders or by act of the

corporation or upon the later date, not more than thirty (30) days after the filing, as is proclaimed

in the statement, the corporation ceases to carry on its business, except insofar as may be

necessary for the winding up, but its corporate existence continues until a certificate of

dissolution has been issued by the secretary of state or until a decree dissolving the corporation

has been entered by a court of competent jurisdiction as provided in this chapter.

     7-1.1-80. Procedure after filing of statement of intent to dissolve. -- After the filing by

the secretary of state of a statement of intent to dissolve:

      (1) The corporation immediately mails notice of the filing to each known creditor of the

corporation.

      (2) The corporation shall process to collect its assets, sell or otherwise dispose of those

of its properties that are not to be distributed in kind to its shareholders, pay, satisfy, and

discharge its liabilities and obligations and do all other acts required to liquidate its business and

affairs. After paying or adequately providing for the payment of all its obligations, the

corporation distributes the remainder of its assets, either in cash or in kind, among its

shareholders according to their respective rights and interests.

      (3) The corporation, at any time during the liquidation of its business and affairs, may

apply to a court of competent jurisdiction within the state and county in which the registered

office or principal place of business of the corporation is situated, to have the liquidation

continued under the supervision of the court as provided in this chapter.

     7-1.1-81. Revocation of voluntary dissolution proceedings by consent of

shareholders. -- (a) By the written consent of all of its shareholders, a corporation may, at any

time prior to the issuance of a certificate of dissolution by the secretary of state, revoke voluntary

dissolution proceedings previously taken, in the following manner:

      (b) Upon the execution of the written consent, a statement of revocation of voluntary

dissolution proceedings is executed in duplicate by the corporation by its president or a vice

president and by its secretary or an assistant secretary, and verified by one of the officers signing

the statement. The statement proclaims:

      (1) The name of the corporation.

      (2) The names and respective addresses of its officers.

      (3) The names and respective addresses of its directors.

      (4) A copy of the written consent signed by all shareholders of the corporation revoking

the voluntary dissolution proceedings.

      (5) That the written consent has been signed by all shareholders of the corporation or

signed in their names by their authorized attorneys.

     7-1.1-82. Revocation of voluntary dissolution proceedings by act of corporation. --

By the act of the corporation, a corporation may, at any time prior to the issuance of a certificate

of dissolution by the secretary of state, revoke voluntary dissolution proceedings previously

taken, in the following manner:

      (1) The board of directors adopts a resolution recommending that the voluntary

dissolution proceedings be revoked, and directing that the question of the revocation be submitted

to a vote at a special meeting of shareholders.

      (2) Written notice, stating that the purpose, or one of the purposes, of the meeting is to

consider the advisability of revoking the voluntary dissolution proceedings, is given to each

shareholder of record entitled to vote at the meeting within the time and in the manner provided

in this chapter for the giving of notice of special meetings of shareholders.

      (3) At the meeting, a vote of the shareholders entitled to vote at the meeting is taken on a

resolution to revoke the voluntary dissolution proceedings, which requires for its adoption the

affirmative vote of the holders of a majority of the shares entitled to vote on the resolution.

      (4) Upon the adoption of the resolution, a statement of revocation of voluntary

dissolution proceedings is executed in duplicate by the corporation by its president or a vice

president and by its secretary or an assistant secretary, and verified by one of the officers signing

the statement. The statement proclaims:

      (i) The name of the corporation.

      (ii) The names and respective addresses of its officers.

      (iii) The names and respective addresses of its directors.

      (iv) A copy of the resolution adopted by the shareholders revoking the voluntary

dissolution proceedings.

      (v) The number of shares outstanding.

      (vi) The number of shares voted for and against the resolution, respectively.

     7-1.1-83. Filing of statement of revocation of voluntary dissolution proceedings. --

Duplicate originals of the statement of revocation of voluntary dissolution proceedings, whether

by consent of shareholders or by act of the corporation, are delivered to the secretary of state. If

the secretary of state finds that the statement conforms to law, he or she shall, when all fees and

franchise taxes have been paid:

      (1) Endorse on each of the duplicate originals the word "Filed," and the month, day, and

year of the filing.

      (2) File one of the duplicate originals in his or her office.

      (3) Return the other duplicate original to the corporation or its representative.

     7-1.1-84. Effect of statement of revocation of voluntary dissolution proceedings. --

Upon the filing by the secretary of state of a statement of revocation of voluntary dissolution

proceedings, whether by consent of shareholders or by act of the corporation, the revocation of

the voluntary dissolution proceedings becomes effective and the corporation may again carry on

its business.

     7-1.1-85. Articles of dissolution. -- If voluntary dissolution proceedings have not been

revoked, then when all debts, liabilities, and obligations of the corporation have been paid and

discharged, or adequate provision has been made for them, and all of the remaining property and

assets of the corporation have been distributed to its shareholders, articles of dissolution shall be

executed in duplicate by the corporation by its president or a vice president and by its secretary or

an assistant secretary, and verified by one of the officers signing the statement. The statement

proclaims:

      (1) The name of the corporation.

      (2) That the secretary of state has previously filed a statement of intent to dissolve the

corporation, and the date on which the statement was filed.

      (3) That all debts, obligations, and liabilities of the corporation have been paid and

discharged or that adequate provision has been made for the payment.

      (4) That all the remaining property and assets of the corporation have been distributed

among its shareholders in accordance with their respective rights and interests.

      (5) That there are not suits pending against the corporation in any court, or that adequate

provision has been made for the satisfaction of any judgment, order, or decree which may be

entered against it in any pending suit.

     7-1.1-86. Filing of articles of dissolution. -- (a) Duplicate originals of the articles of

dissolution are delivered to the secretary of state. If the secretary of state finds that the articles of

dissolution conform to law, he or she shall, when all fees and franchise taxes have been paid:

      (1) Endorse on each of the duplicate originals the word "Filed," and the month, day, and

year of the filing.

      (2) File one of the duplicate originals in his or her office.

      (3) Issue a certificate of dissolution to which he or she shall affixes the other duplicate

original.

      (b) The certificate of dissolution, together with the duplicate original of the articles of

dissolution affixed to it by the secretary of state, are returned to the representative of the

dissolved corporation. Upon the issuance of the certificate of dissolution the existence of the

corporation ceases, except for the purpose of suits, other proceedings, and appropriate corporate

action by shareholders, directors, and officers as provided in this chapter.

     7-1.1-87. Revocation of certificate of incorporation. -- (a) The certificate of

incorporation of a corporation may be revoked by the secretary of state upon the conditions

prescribed in this section when it is established that:

      (1) The corporation procured its articles of incorporation through fraud; or

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

law; or

      (3) The corporation has failed to file its annual report within the time required by this

chapter, or has failed to pay any fees, when they have become due and payable; or

      (4) The corporation has failed for thirty (30) days to appoint and maintain a registered

agent in this state as required by this chapter; or

      (5) The corporation has failed, after change of its registered office or registered agent, to

file in the office of the secretary of state a statement of the change as required by this chapter; or

      (6) The corporation has failed to file in the office of the secretary of state any

amendment to its articles of incorporation or any articles of merger within the time prescribed by

this chapter; or

      (7) A misrepresentation has been made of any material matter in any application, report,

affidavit, or other document submitted by the corporation pursuant to this chapter.

      (b) No certificate of incorporation of a corporation shall be revoked by the secretary of

state unless:

      (1) The secretary of state shall have given the corporation not less than sixty (60) days

notice thereof by regular mail addressed to the registered office of the corporation in this state on

file with the secretary of state's office; provided, however, that if a prior mailing addressed to the

registered office of the corporation in this state currently on file with the secretary of state's office

has been returned to the secretary of state as undeliverable by the United States Postal Service for

any reason, or if the revocation notice is returned as undeliverable to the secretary of state's office

by the United States Postal Service for any reason, the secretary of state shall give notice as

follows:

      (i) To the corporation at its principal office of record as shown in its most recent annual

report, and no further notice shall be required; or

      (ii) In the case of a domestic corporation which has not yet filed an annual report, then to

any one of the incorporators listed on the articles of incorporation, and no further notice shall be

required; and

      (2) The corporation fails prior to revocation to file the annual report or pay the fees, or

file the required statement of change of registered agent or registered office, or file the articles of

amendment or articles of merger, or correct the misrepresentation.

     7-1.1-88. Issuance of certificates of revocation. -- (a) Upon revoking any certificate of

incorporation, the secretary of state shall:

      (1) Issue a certificate of revocation in duplicate;

      (2) File one certificate in his or her office; and

      (3) Send to the corporation by regular mail a certificate of revocation, addressed to the

registered office of the corporation in this state on file with the secretary of state's office;

provided, however, that if a prior mailing addressed to the registered office of the corporation in

this state currently on file with the secretary of state's office has been returned to the secretary of

state as undeliverable by the United States Postal Service for any reason, or if the revocation

certificate is returned as undeliverable to the secretary of state's office by the United States Postal

Service for any reason, the secretary of state shall give notice as follows:

      (i) To the corporation at its principal office of record as shown in its most recent annual

report, and no further notice shall be required; or

      (ii) In the case of a domestic corporation which has not yet filed an annual report, then to

any one of the incorporators listed on the articles of incorporation, and no further notice shall be

required.

      (b) Upon the issuance of the certificate of revocation, the authority of the corporation to

transact business in this state ceases.

     7-1.1-88.1. Withdrawal of certificate of revocation. -- (a) Within ten (10) years after

issuing a certificate of revocation as provided in section 7-1.1-88, the secretary of state may

withdraw the certificate of revocation and retroactively reinstate the corporation in good standing

as if its certificate of incorporation had not been revoked, except as subsequently provided:

      (1) Upon the filing by the corporation of the documents it had previously failed to file as

set forth in subdivisions (3) through (6) inclusive, of section 7-1.1-87(a);

      (2) Upon the payment by the corporation of a penalty in the amount of fifty dollars

($50.00) for each year or part of a year that has elapsed since the issuance of the certificate of

revocation; and

      (3) Upon the filing by the corporation of a certificate of good standing from the Rhode

Island division of taxation.

      (b) If, as permitted by the provisions of this title, another corporation, whether business

or nonprofit limited partnership or limited liability company, or domestic or foreign, qualified to

transact business in this state, bears or has filed a fictitious business name statement with respect

to or reserved or registered a name which is the same as, or deceptively similar to, the name of a

corporation with respect to which the certificate of revocation is proposed to be withdrawn, then

the secretary of state shall condition the withdrawal of the certificate of revocation upon the

reinstated corporation's amending its articles of incorporation or otherwise complying with the

provisions of this chapter with respect to the use of a name available to it under the laws of this

state so as to designate a name which is not the same as, or deceptively similar to, its former

name.

      (c) Upon the withdrawal of the certificate of revocation and reinstatement of the

corporation in good standing as provided in subsection (a), title to any real estate, or any interest

in real estate, held by the corporation at the time of the issuance of the certificate of revocation

and not conveyed subsequent to the revocation of its certificate of incorporation shall be deemed

to be revested in the corporation without further act or deed.

     7-1.1-89. Appeal from revocation of articles of incorporation. -- Any corporation

aggrieved by the action of the secretary of state in revoking its articles of incorporation may

appeal the action in the manner provided in section 7-1.1-133.

     7-1.1-90. Jurisdiction of court to liquidate assets and business of corporation. -- (a)

The superior court has full power to liquidate the assets and business of a corporation:

      (1) In an action by a shareholder when it is established that, whether or not the corporate

business has been or could be operated at a profit, dissolution would be beneficial to the

shareholders because:

      (i) The directors or those other persons that may be responsible for management pursuant

to section 7-1.1-51(a) are deadlocked in the management of the corporate affairs and the

shareholders are unable to break the deadlock; or

      (ii) The acts of the directors or those in control of the corporation are illegal, oppressive,

or fraudulent; or

      (iii) The shareholders are deadlocked in voting power, and have failed, for a period

which includes at least two (2) consecutive annual meeting dates, to elect successors to directors

whose terms have expired or would have expired upon the election of their successors; or

      (iv) The corporate assets are being misapplied or are in danger of being wasted or lost; or

      (v) Two (2) or more factions of shareholders are divided and there is such internal

dissension that serious harm to the business and affairs of the corporation is threatened; or

      (vi) The holders of one-half ( 1/2) or more of all the outstanding capital stock of the

corporation have voted to dissolve the corporation;

      (2) (i) 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 are being misapplied or are in danger

of being wasted or lost.

      (ii) If it is established that the claim of a creditor has been reduced to judgment and an

execution on the judgment returned unsatisfied or that a corporation has admitted, in writing, that

the claim of a creditor is due and owing, the establishment of the facts are prima facie evidence of

insolvency.

      (iii) Every petition filed by a creditor for the liquidation of the assets and business of a

corporation shall contain a statement as to whether the creditor is or is not an officer, director, or

shareholder of the corporation. Every petition for the liquidation of the assets and business of a

corporation filed by an officer, director, or shareholder of a corporation or by a creditor who is an

officer, director or shareholder, shall contain, to the best of petitioner's knowledge, information,

and belief, the names and addresses of all known creditors of any class of the corporation.

      (3) Upon application by a corporation which has filed a statement of intent to dissolve,

as provided in this chapter, to have its liquidation continued under the supervision of the court.

The application shall contain, to the best of petitioner's knowledge, information, and belief, the

names and addresses of all known creditors of any class of the corporation.

      (4) When an action has been filed by the attorney general to dissolve a corporation and it

is established that liquidation of its business and affairs should precede the entry of a decree of

dissolution.

      (b) Proceedings under subsections (a)(1), (a)(2), or (a)(3) shall be brought in the county

in which the registered or principal office of the corporation is situated.

      (c) It is not necessary to make shareholders parties to any action or proceeding unless

relief is sought against them personally.

     7-1.1-90.1. Avoidance of dissolution by stock buyout. -- Whenever a petition for

dissolution of a corporation is filed by one or more shareholders (subsequently in this section

referred to as the "petitioner") pursuant to either section 7-1.1-90 or a right to compel dissolution

which is authorized under section 7-1.1-51 or is otherwise valid, one or more of its other

shareholders may avoid the dissolution by filing with the court prior to the commencement of the

hearing, or, in the discretion of the court, at any time prior to a sale or other disposition of the

assets of the corporation, an election to purchase the shares owned by the petitioner at a price

equal to their fair value. If the shares are to be purchased by other shareholders, notice shall be

sent to all shareholders of the corporation other than the petitioner, giving them an opportunity to

join in the election to purchase the shares. If the parties are unable to reach an agreement as to the

fair value of the shares, the court shall, upon the giving of a bond or other security sufficient to

assure to the petitioner payment of the value of the shares, stay the proceeding and determine the

value of the shares, in accordance with the procedure set forth in section 7-1.1-74, as of the close

of business on the day on which the petition for dissolution was filed. Upon determining the fair

value of the stock, the court shall state in its order directing that the stock be purchased, the

purchase price and the time within which the payment is to be made, and may decree any other

terms and conditions of sale that it determines to be appropriate, including payment of the

purchase price in installments extending over a period of time, and, if the shares are to be

purchased by shareholders, the allocation of shares among shareholders electing to purchase

them, which, so far as practicable, are to be proportional to the number of shares previously

owned. The petitioner is entitled to interest, at the rate on judgments in civil actions, on the

purchase price of the shares from the date of the filing of the election to purchase the shares, and

all other rights of the petitioner as owner of the shares terminate on that date. The costs of the

proceeding, which include reasonable compensation and expenses of appraisers but not fees and

expenses of counsel or of experts retained by a party, shall be allocated between or among the

parties as the court determines. Upon full payment of the purchase price, under the terms and

conditions specified by the court, or at any other time that is ordered by the court, the petitioner

shall transfer the shares to the purchaser.

     7-1.1-91. Procedure in liquidation of corporation by court. -- (a) In proceedings to

liquidate the assets and business of a corporation the court has general equity jurisdiction and

power to issue any orders, injunctions, and decrees that justice and equity require, to appoint a

receiver or receivers pendente lite, with any powers and duties that the court, from time to time,

directs, and to take any other proceedings that are requisite to preserve the corporate assets

wherever situated, and carry on the business of the corporation until a full hearing can be had.

      (b) After a hearing had upon any notice that the court directs to be given to all parties to

the proceedings and to any other parties in interest designated by the court, the court may appoint

a liquidating receiver or receivers with authority to take charge of any of the corporation's estate

and effects of which he or she has been appointed receiver and to collect the assets of the

corporation, including all amounts owing to the corporation whether by shareholders on account

of any unpaid portion of the consideration for the issuance of shares or otherwise.

      (c) The hearing date for the appointment of a permanent receiver is not to be more than

twenty-one (21) days after commencement of the action, unless the hearing date is extended by

the court for good cause shown.

      (d) The liquidating receiver or receivers has authority subject to court order, to sue and

defend in all courts in his or her own name as receiver of the corporation, or in its name, to

intervene in any action or proceeding relating to its assets or business, to compromise any dispute

or controversy, to preserve the assets of the corporation, to carry on its business, to sell, convey,

and dispose of all or any part of the assets of the corporation wherever situated, either at public or

private sale, to redeem any mortgages, security interests, pledges, or liens of or upon any of its

assets, and generally to do all other acts which might be done by the corporation or that is

necessary for the administration of his or her trust according to the course of equity. The assets of

the corporation or the proceeds resulting from a sale, conveyance, or other disposition of the

assets shall be applied to the expenses of the liquidation and to the payment of the liabilities and

obligations of the corporation, and any remaining assets or proceeds shall be distributed under the

direction of the court among its shareholders according to their respective rights and interests.

The order appointing the receiver or receivers shall state their powers and duties. The powers and

duties may be increased or diminished at any time during the proceeding.

      (e) The court has power to allow from time to time as expenses of the liquidation

compensation to the receiver or receivers and to attorneys in the proceeding, and to direct the

payment of the compensation out of the assets of the corporation or the proceeds of any sale or

disposition of the assets.

      (f) The court appointing the receiver has exclusive jurisdiction of the corporation and its

property, wherever situated, and of all questions arising in the proceedings concerning the

property.

     7-1.1-92. Bond of receivers. -- A receiver shall in all cases give any bond that the court

directs with any sureties that the court requires.

     7-1.1-93. Filing of claims in liquidation proceedings. -- In proceedings to liquidate the

assets and business of a corporation, the court may require all creditors of the corporation to file

with the receiver, in any form that the court prescribes, proofs under oath of their respective

claims. If the court requires the filing of claims it shall fix a date, which is not to be less than four

(4) months from the date of the order, as the last day for the filing of claims, and shall prescribe

the notice that is to be given to creditors and claimants of the fixed date. Prior to the fixed date,

the court may extend the time for the filing of claims. Creditors and claimants failing to file

proofs of claim on or before the fixed date may be barred, by court order, from participating in

the distribution of the assets of the corporation.

     7-1.1-94. Discontinuance of liquidation proceedings. -- The liquidation of the assets

and business of a corporation may be discontinued at any time during the liquidation proceedings

when it is established that cause for liquidation no longer exists. In that event the court shall

dismiss the proceedings, direct the receiver to redeliver to the corporation all its remaining

property and assets, and order any notice to creditors that the court deems proper under the

circumstances.

     7-1.1-95. Decree of involuntary dissolution. -- In proceedings to liquidate the assets and

business of a corporation, when the costs and expenses of the proceedings and all debts,

obligations, and liabilities of the corporation have been paid and discharged and all of its

remaining property and assets distributed to its shareholders, or in case its property and assets are

not sufficient to satisfy and discharge the costs, expenses, debts, and obligations, all the property

and assets have been applied as far as they will go to their payment, the court shall enter a decree

dissolving the corporation, at which time the existence of the corporation ceases.

     7-1.1-96. Filing of decree of dissolution. -- In case the court enters a decree dissolving a

corporation, it is the duty of the clerk of the court to file a certified copy of the decree with the

secretary of state. No fee shall be charged by the secretary of state for that filing.

     7-1.1-97. Deposit with state treasury of amount due certain shareholders. -- Upon the

voluntary or involuntary dissolution of a corporation, the portion of the assets distributable to a

creditor or shareholder who is unknown or cannot be found, or who is under disability and there

is no person legally competent to receive the distributive portion, shall be reduced to cash and

deposited with the general treasury and paid over to the creditor or shareholder or to his or her

legal representative upon satisfactory proof to the general treasury of his or her right to the

payment.

     7-1.1-97.1. Jurisdiction of court to appoint a receiver. -- Upon the establishment of

any of the grounds for liquidation of the assets and business of (1) a domestic corporation or (2) a

foreign corporation, to the extent the foreign corporation has assets within the state, stated in

section 7-1.1-90, and upon the establishment that the liquidation would not be appropriate, the

superior court has full power to appoint a receiver, with any powers and duties that the court,

from time to time, directs, and to take any other proceedings that the court deems advisable under

the circumstances. The provisions of sections 7-1.1-90 -- 7-1.1-97, insofar as they are consistent

with the nature of the proceeding, apply to the proceeding, and in the proceeding the court has the

full powers of a court of equity to make or enter any orders, injunctions, and decrees and grant

any other relief in the proceeding that justice and equity require.

     7-1.1-98. Survival of remedy after dissolution. -- The dissolution of a corporation

either:

      (1) by the issuance of a certificate of dissolution by the secretary of state; or

      (2) by a decree of court when the court has not liquidated the assets and business of the

corporation as provided in this chapter; or

      (3) by expiration of its period of duration, shall not take away or impair any remedy

available to or against the corporation, its directors, officers, or shareholders, for any right or

claim existing, or any liability incurred, prior to the dissolution if action or other proceeding on

the right, claim, or liability is commenced within two (2) years after the date of the dissolution.

Any action or proceeding by or against the corporation may be prosecuted or defended by the

corporation in its corporate name. The shareholders, directors, and officers have power to take

any corporate or other action that is appropriate to protect the remedy, right, or claim. If the

corporation was dissolved by the expiration of its period of duration, the corporation may amend

its articles of incorporation at any time during the period of two (2) years so as to extend its

period of duration.

     7-1.1-98.1. Continuation of certain corporate powers. -- Any corporation dissolved in

any manner under this chapter or any corporation whose existence is terminated under section 44-

12-8 or any corporation whose certificate of incorporation is revoked by the secretary of state

under section 7-1.1-87 nevertheless continues for five (5) years after the date of the dissolution,

termination, or revocation for the purpose of enabling it to settle and close its affairs, to dispose

of and convey its property, to discharge its liabilities, and to distribute its assets, but not for the

purpose of continuing the business for which it was organized. The shareholders, directors, and

officers have power to take any corporate or other action that is appropriate to carry out the

purposes of this section.

     7-1.1-99. Admission of foreign corporation. -- (a) No foreign corporation has the right

to transact business in this state until it has procured a certificate of authority to do so from the

secretary of state. No foreign corporation is entitled to procure a certificate of authority under this

chapter to transact any business in this state which a corporation organized under this chapter is

not permitted to transact. A foreign corporation shall not be denied a certificate of authority

because the laws of the state or country under which the corporation is organized governing its

organization and internal affairs differ from the laws of this state, and nothing contained in this

chapter shall be construed to authorize this state to regulate the organization or the internal affairs

of the corporation.

      (b) Without excluding other activities which may not constitute transacting business in

this state, a foreign corporation is not considered to be transacting business in this state, for the

purposes of this chapter, because of carrying on in this state any one or more of the following

activities:

      (1) Maintaining or defending any action or suit or any administrative or arbitration

proceeding, or effecting the settlement of the suit or the settlement of claims or disputes.

      (2) Holding meetings of its directors or shareholders or carrying on other activities

concerning its internal affairs.

      (3) Maintaining bank accounts.

      (4) Maintaining offices or agencies for the transfer, exchange, and registration of its

securities, or appointing and maintaining trustees or depositaries with relation to its securities.

      (5) Effecting sales through independent contractors.

      (6) Soliciting or procuring orders, whether by mail or through employees or agents or

otherwise, where the orders require acceptance outside of this state before becoming binding

contracts.

      (7) Creating as borrower or lender, or acquiring indebtedness or mortgages or other

security interests in real or personal property.

      (8) Securing or collecting debts or enforcing any rights in property securing the debts.

      (9) Transacting any business in interstate commerce.

      (10) Conducting an isolated transaction completed within a period of thirty (30) days and

not in the course of a number of repeated transactions of like nature.

      (11) Acting as a general partner of a limited partnership which has filed a certificate of

limited partnership as provided in section 7-13-8 or has registered with the secretary of state as

provided in section 7-13-49.

     7-1.1-99.1. Admission of foreign business trusts. -- Any Massachusetts trust or business

trust established by law of any other state, desiring to do business in this state, is deemed to be a

foreign corporation and is required to register under, and comply with the provisions of, this

chapter.

     7-1.1-100. Powers of foreign corporation. -- A foreign corporation which has received a

certificate of authority under this chapter shall, until a certificate of revocation or of withdrawal

has been issued as provided in this chapter, enjoy the same, but no greater, rights and privileges

as a domestic corporation organized for the purposes stated in the application pursuant to which

the certificate of authority is issued; and, except as otherwise provided in this chapter, is subject

to the same duties, restrictions, penalties, and liabilities now or subsequently imposed upon a

domestic corporation of like character.

     7-1.1-101. Corporate name of foreign corporation. -- No certificate of authority shall

be issued to a foreign corporation unless the corporate name of the corporation:

      (1) Contains the word "corporation," "company," "incorporated," or "limited," or

contains an abbreviation of one of the words, or the corporation, for use in this state, adds at the

end of its name one of the words or an abbreviation of the word.

      (2) Does not contain any word or phrase which indicates or implies that it is organized

for any purpose other than one or more of the purposes contained in its articles of incorporation

or that it is authorized or empowered to conduct the business of any types prohibited by section 7-

1.1-3.

      (3) Is not the same as, or deceptively similar to, the name of any domestic corporation,

limited partnership or limited liability company existing under the laws of this state or any

foreign corporation, limited partnership or limited liability company authorized to transact

business in this state, or a name the exclusive right to which is, at the time, filed, reserved or

registered in the manner provided in this title, subject to the following:

      (i) This provision does not apply if the foreign corporation applying for a certificate of

authority files with the secretary of state any one of the following:

      (A) A fictitious business name statement pursuant to section 7-1.1-7.1; or

      (B) The written consent of the other corporation or holder of a filed, reserved or

registered name to use that name or a deceptively similar name and one or more words are added

to make the name distinguishable from the other name; or

      (C) A certified copy of a final decree of a court of competent jurisdiction establishing the

prior right of the foreign corporation to the use of the name in this state; and

      (ii) The name may be the same as, or deceptively similar to, the name of a corporation or

other association, the certificate of incorporation or organization of which has been revoked by

the secretary of state as permitted by law.

     7-1.1-102. Change of name by foreign corporation. -- Whenever a foreign corporation

which is authorized to transact business in this state changes its name to one under which a

certificate of authority would not be granted to it on application, the certificate of authority of the

corporation is suspended and it shall not subsequently transact any business in this state until it

has changed its name to a name which is available to it under the laws of this state or has

otherwise complied with the provisions of this chapter.

     7-1.1-103. Application for certificate of authority. -- (a) A foreign corporation, in order

to procure a certificate of authority to transact business in this state, shall make application for the

certificate of authority to the secretary of state, which application shall state:

      (1) The name of the corporation and the state or country under the laws of which it is

incorporated.

      (2) If the name of the corporation does not contain the word "corporation," "company,"

"incorporated," or "limited," or does not contain an abbreviation of one of those words, then the

name of the corporation with the word or abbreviation which it elects to add for use in this state.

      (3) The date of incorporation and the period of duration of the corporation.

      (4) The address of the principal office of the corporation in the state or country under the

laws of which it is incorporated.

      (5) The address of the proposed registered office of the corporation in this state, and the

name of its proposed registered agent in this state at the address.

      (6) The purpose or purposes of the corporation which it proposes to pursue in the

transaction of business in this state.

      (7) The names and respective addresses of the directors and officers of the corporation.

      (8) A statement of the aggregate number of shares which the corporation has authority to

issue, itemized by classes, par value of shares, shares without par value, and series, if any, within

a class.

      (9) A statement of the aggregate number of issued shares itemized by classes, par value

of shares, shares without par value, and series, if any, within a class.

      (10) An estimate, expressed as a percentage, of the proportion that the estimated value of

the property of the corporation to be located within this state during the following year bears to

the value of all property of the corporation to be owned during the following year, wherever

located, and an estimate, expressed as a percentage, of the proportion that the gross amount of

business to be transacted by the corporation at or from places of business in this state during the

year bears to the gross amount which will be transacted by the corporation during the year.

      (11) Any additional information that is necessary or appropriate in order to enable the

secretary of state to determine whether the corporation is entitled to a certificate of authority to

transact business in this state and to determine and assess the fees payable as prescribed in this

chapter.

      (b) The application shall be made on forms prescribed and furnished by the secretary of

state and executed in duplicate by the corporation by its president or a vice president and by its

secretary or an assistant secretary, and verified by one of the officers signing the application.

     7-1.1-104. Filing of application for certificate of authority. -- (a) Duplicate originals of

the application of the corporation for a certificate of authority shall be delivered to the secretary

of state, together with a copy of its articles of incorporation and all amendments to the articles,

duly authenticated by the proper officer of the state or country under the laws of which it is

incorporated.

      (b) If the secretary of state finds that the application conforms to law, he or she shall,

when all fees have been paid:

      (1) Endorse on each of the documents the word "Filed," and the month, day, and year of

the filing.

      (2) File in his or her office one of the duplicate originals of the application and the copy

of the articles of incorporation and amendments to the articles.

      (3) Issue a certificate of authority to transact business in this state to which he or she

affixes the other duplicate original application.

      (c) The certificate of authority, together with the duplicate original of the application

affixed to it by the secretary of state, shall be returned to the corporation or its representatives.

     7-1.1-105. Effect of certificate of authority. -- Upon the issuance of a certificate of

authority by the secretary of state, the corporation is authorized to transact business in this state

for the purposes stated in its application, subject, however, to the right of this state to suspend or

to revoke the authority as provided in this chapter.

     7-1.1-106. Registered office and registered agent of foreign corporation. -- (a) Each

foreign corporation authorized to transact business in this state shall have and continuously

maintain in this state:

      (1) A registered office which may be, but need not be, the same as its place of business

in this state.

      (2) A registered agent, who may be either an individual resident in this state whose

business is identical with the registered office, or a domestic corporation, or a foreign corporation

authorized to transact business in this state, having a business office identical with the registered

office; provided, however, that in the case where the registered agent of a corporation is an

attorney the business address of the agent need not be identical with the registered office, but may

be at the usual business address of the attorney.

      (b) Foreign corporations who are the holders of mortgages on real estate located within

this state which do not maintain the loan documentation and records within the state shall

authorize the registered agent to accept mortgage discharge payment and to issue a discharge of

the mortgages upon the payment.

     7-1.1-107. Change of registered office or registered agent of foreign corporation. --

(a) A foreign corporation authorized to transact business in this state may change its registered

office or change its registered agent, or both, upon filing in the office of the secretary of state a

statement stating:

      (1) The name of the corporation.

      (2) The address of its then registered office.

      (3) If the address of its registered office is changed, the address to which the registered

office is to be changed.

      (4) The name of its then registered agent.

      (5) If its registered agent is changed, the name of its successor registered agent.

      (6) The address of its registered office and the address of the business office of its

registered agent, as changed.

      (7) That the change was authorized by a resolution adopted by its board of directors.

      (b) The statement shall be executed by the corporation by its president or a vice

president, and verified by him or her, and delivered to the secretary of state. If the secretary of

state finds that the statement conforms to the provisions of this chapter, he or she shall file the

statement in this office, and upon the filing, the change of address of the registered office, or the

appointment of a new registered agent, or both, becomes effective.

      (c) Any registered agent of a foreign corporation may resign as the agent upon filing a

written notice of resignation, executed in duplicate, with the secretary of state, who shall

immediately mail a copy of the notice to the corporation at its principal office in the state or

country under the laws of which it is incorporated. The appointment of the agent terminates upon

the expiration of thirty (30) days after receipt of the notice by the secretary of state.

      (d) If a registered agent changes his or her or its business address to another place within

the state, he or she or it may change the address and the address of the registered office of any

corporations of which he or she or it is registered agent by filing a statement as required above

except that it must be signed only by the registered agent, need not be responsive to subsection (a)

(5) or (a) (7), and must recite that a copy of the statement has been mailed to each corporation.

     7-1.1-108. Service of process on foreign corporation. -- (a) The registered agent

appointed by a foreign corporation authorized to transact business in this state shall be an agent of

the corporation upon whom any process, notice, or demand required or permitted by law to be

served upon the corporation may be served.

      (b) Whenever a foreign corporation authorized to transact business in this state fails to

appoint or maintain a registered agent in this state, or whenever any registered agent cannot with

reasonable diligence be found at the registered office, or whenever the certificate of authority of a

foreign corporation is suspended or revoked, the secretary of state is an agent of the corporation

upon whom any process, notice, or demand may be served. Service on the secretary of state of

any process, notice, or demand shall be made by delivering to and leaving with him or her, or

with any clerk having charge of the corporation department of his or her office, duplicate copies

of the process, notice, or demand. In the event any process, notice, or demand is served on the

secretary of state, he or she shall immediately forward one of the copies by registered mail,

addressed to the corporation at its principal office if known to him or her, in the state or country

under the laws of which it is incorporated. Any service had in this manner on the secretary of

state is returnable in not less than thirty (30) days.

      (c) Every foreign corporation as a condition precedent to carrying on business in this

state shall, and by so carrying on business in this state does, consent that any process, including

the process of garnishment, may be served upon the secretary of state in the manner provided by

this section, except that notice of the service shall be given by the plaintiff or his or her attorney

in the manner as the court in which the action is commenced or pending orders as affording the

corporation reasonable opportunity to defend the action or to learn of the garnishment.

Notwithstanding the preceding requirements, however, once service has been made on the

secretary of state as provided, the court has the authority in the event of failure to comply with the

requirement of notice to the foreign corporation to order notice that is sufficient to apprise it of

the pendency of the action against it, and additionally, may extend the time for answering by the

foreign corporation.

      (d) The secretary of state shall keep a record of all processes, notices, and demands

served upon him or her under this section, and record in the record the time of the service and his

or her action on it.

      (e) Nothing contained in these provisions limits or affects the right to serve any process,

notice, or demand, required or permitted by law to be served upon a corporation in any manner

now or subsequently permitted by law.

     7-1.1-109. Amendment to articles of incorporation of foreign corporation. --

Whenever the articles of incorporation of a foreign corporation authorized to transact business in

this state are amended, the foreign corporation shall, within thirty (30) days after the amendment

becomes effective, file in the office of the secretary of state a copy of the amendment duly

authenticated by the proper officer of the state or country under the laws of which it is

incorporated; but the filing of the copy does not of itself enlarge or alter the purpose or purposes

which the corporation is authorized to pursue in the transaction of business in this state, nor

authorize the corporation to transact business in this state under any other name than the name

stated in its certificate of authority.

     7-1.1-110. Merger of foreign corporation authorized to transact business in this

state. -- Whenever a foreign corporation authorized to transact business in this state is a party to a

statutory merger permitted by the laws of the state or country under the laws of which it is

incorporated, and the corporation is the surviving corporation, it shall, within thirty (30) days

after the merger becomes effective, file with the secretary of state a copy of the articles of merger

duly authenticated by the proper officer of the state or country under the laws of which the

statutory merger was effected; and it is not necessary for the corporation to procure either a new

or amended certificate of authority to transact business in this state unless the name of the

corporation is changed by the merger or unless the corporation desires to pursue in this state other

or additional purposes than those which it is then authorized to transact in this state. Whenever a

foreign corporation authorized to transact business in this state ceases to exist because of a

statutory merger or consolidation, it shall comply with section 7-1.1-112.

     7-1.1-111. Amended certificate of authority. -- (a) A foreign corporation authorized to

transact business in this state shall procure an amended certificate of authority if it changes its

corporate name, increases its number of authorized shares, or desires to pursue in this state other

or additional purposes than those stated in its prior application for a certificate of authority, by

making application for those additional purposes to the secretary of state.

      (b) The requirements in respect to the form and contents of the application, the manner

of its execution, the filing of duplicate originals of the application with the secretary of state, the

issuance of an amended certificate of authority, and the effect of it, is the same as in the case of

an original application for a certificate of authority.

     7-1.1-112. Withdrawal of foreign corporation. -- (a) A foreign corporation authorized

to transact business in this state may withdraw from this state upon procuring from the secretary

of state a certificate of withdrawal. In order to procure a certificate of withdrawal, the foreign

corporation shall deliver to the secretary of state an application for withdrawal, stating:

      (1) The name of the corporation and the state or country under the laws of which it is

incorporated.

      (2) That the corporation is not transacting business in this state.

      (3) That the corporation surrenders its authority to transact business in this state.

      (4) That the corporation revokes the authority of its registered agent in this state to

accept service of process and consents that service of process in any action, suit, or proceeding

based upon any cause of action arising in this state during the time the corporation was authorized

to transact business in this state may subsequently be made on the corporation by service on the

secretary of state.

      (5) The post office address to which the secretary of state may mail a copy of any

process against the corporation that is served on him or her.

      (6) A statement of the aggregate number of shares which the corporation has authority to

issue, itemized by classes, par value of shares, shares without par value, and series, if any, within

a class, as of the date of the application.

      (7) A statement of the aggregate number of issued shares, itemized by classes, par value

of shares, shares without par value, and series, if any, within a class, as of the date of the

application.

      (8) A statement, expressed in dollars, of the amount of stated capital of the corporation,

as of the date of the application.

      (9) Any additional information that may be necessary or appropriate in order to enable

the secretary of state to determine and assess any unpaid fees payable by the foreign corporation.

      (b) The application for withdrawal shall be made on forms prescribed and furnished by

the secretary of state and executed by the corporation by its president or a vice president and by

its secretary or an assistant secretary, and verified by one of the officers signing the application,

or, if the corporation is in the hands of a receiver or trustee, executed on behalf of the corporation

by the receiver or trustee and verified by him or her.

     7-1.1-113. Filing of application for withdrawal. -- (a) Duplicate originals of the

application for withdrawal shall be delivered to the secretary of state. If the secretary of state

finds that the application conforms to the provisions of this chapter, he or she shall, when all fees

and taxes have been paid:

      (1) Endorse on each of the duplicate originals the word "Filed," and the month, day, and

year of the filing.

      (2) File one of the duplicate originals in his or her office.

      (3) Issue a certificate of withdrawal to which he or she affixes the other duplicate

original.

      (b) The certificate of withdrawal, together with the duplicate original of the application

for withdrawal affixed to it by the secretary of state, shall be returned to the corporation or its

representative. Upon the issuance of the certificate of withdrawal, the authority of the corporation

to transact business in this state ceases.

     7-1.1-114. Revocation of certificate of authority. -- (a) The certificate of authority of a

foreign corporation to transact business in this state may be revoked by the secretary of state

under the conditions prescribed in this section when:

      (1) The corporation fails to file its annual report within the time required by this chapter,

or fails to pay any fees, when they become due and payable; or

      (2) The corporation fails to appoint and maintain a registered agent in this state as

required by this chapter; or

      (3) The corporation fails, after changing its registered office or registered agent, to file in

the office of the secretary of state a statement of the change as required by this chapter; or

      (4) The corporation fails to file in the office of the secretary of state any amendment to

its articles of incorporation or any articles of merger within the time prescribed by this chapter; or

      (5) A misrepresentation has been made of any material matter in any application, report,

affidavit, or other document submitted by the corporation pursuant to this chapter.

      (b) No certificate of authority of a foreign corporation shall be revoked by the secretary

of state unless:

      (1) The secretary of state shall have given the corporation not less than sixty (60) days

notice thereof by regular mail addressed to the registered office of the corporation in this state on

file with the secretary of state's office; provided, however, that if a prior mailing addressed to the

registered office of the corporation in this state currently on file with the secretary of state's office

has been returned to the secretary of state as undeliverable by the United States Postal Service for

any reason, or if the revocation notice is returned as undeliverable to the secretary of state's office

by the United States Postal Service for any reason, the secretary of state shall give notice as

follows:

      (i) To the corporation at its principal office of record as shown in its most recent annual

report, and no further notice shall be required; or

      (ii) In the case of a foreign corporation which has not yet filed an annual report, then to

the corporation at its principal office shown in its application for certificate of authority, and no

further notice shall be required; and

      (2) The corporation fails prior to revocation to file the annual report, or pay the fees, or

file the required statement of change of registered agent or registered office, or file the articles of

amendment or articles of merger, or correct the misrepresentation.

     7-1.1-115. Issuance of certificate of revocation. -- (a) Upon revoking any certificate of

authority, the secretary of state shall:

      (1) Issue a certificate of revocation in duplicate.

      (2) File one of the certificates in his or her office.

      (3) Send to the corporation by regular mail a certificate of revocation, addressed to the

registered office of the corporation in this state on file with the secretary of state's office;

provided, however, that if a prior mailing addressed to the registered office of the corporation in

this state currently on file with the secretary of state's office has been returned to the secretary of

state as undeliverable by the United States Postal Service for any reason, or if the revocation

certificate is returned as undeliverable to the secretary of state's office by the United States Postal

Service for any reason, the secretary of state shall give notice as follows:

      (i) To the corporation at its principal office of record as shown in its most recent annual

report, and no further notice shall be required; or

      (ii) In the case of a foreign corporation that has not yet filed an annual report then to the

corporation at its principal office shown in its application for certificate of authority, and no

further notice shall be required.

      (b) Upon the issuance of the certificate of revocation, the authority of the corporation to

transact business in this state ceases.

     7-1.1-115.1. Withdrawal of certificate of revocation. -- (a) Within ten (10) years after

issuing a certificate of revocation as provided in section 7-1.1-115, the secretary of state may

withdraw the certificate of revocation retroactively and retroactively reinstate the corporation in

good standing as though its certificate of authority had not been revoked, except as subsequently

provided;

      (1) Upon the filing by the corporation of the documents it had previously failed to file as

stated in subdivisions (1) -- (3) of section 7-1.1-115(a);

      (2) Upon the payment by the corporation of a penalty in the amount of fifty dollars

($50.00) for each year or part of a year that has elapsed since the issuance of the certificate of

revocation; and

      (3) Upon the filing by the corporation of a certificate of good standing from the Rhode

Island division of taxation.

      (b) If, as permitted by the provisions of this title, another corporation, whether business

or nonprofit, limited partnership or limited liability company, domestic or foreign, qualified to

transact business in this state, bears or has filed a fictitious business name statement with respect

to or reserved or registered a name which is the same as, or deceptively similar to, the name of a

corporation with respect to which the certificate of revocation is proposed to be withdrawn, then

the secretary of state shall condition the withdrawal of the certificate of revocation on the

reinstated corporation's amending its application for a certificate of authority or otherwise

complying with the provisions of this chapter with respect to the use of the name available to it

under the laws of this state.

     7-1.1-116. Application to corporations previously authorized to transact business in

this state. -- Foreign corporations which are authorized to transact business in this state as of

May 14, 1969, for a purpose or purposes for which a corporation might secure authority under

this chapter, are, subject to the limitations stated in their certificates of authority, entitled to all the

rights and privileges applicable to foreign corporations procuring certificates of authority to

transact business in this state under this chapter, and as of May 14, 1969 the corporations are

subject to all the limitations, restrictions, liabilities, and duties prescribed in these provisions for

foreign corporations procuring certificates of authority to transact business in this state under this

chapter.

     7-1.1-117. Transacting business without certificate of authority. -- (a) No foreign

corporation transacting business in this state without a certificate of authority is permitted to

maintain any action, suit, or proceeding in any court of this state, until the corporation has

obtained a certificate of authority. Nor shall any action, suit, or proceeding be maintained in any

court of this state by any successor or assignee of the corporation on any right, claim, or demand

arising out of the transaction of business by the corporation in this state, until a certificate of

authority has been obtained by the corporation or by a corporation which has acquired all or

substantially all of its assets.

      (b) The failure of a foreign corporation to obtain a certificate of authority to transact

business in this state does not impair the validity of any contract or act of the corporation, and

does not prevent the corporation from defending any action, suit, or proceeding in any court of

this state.

      (c) A foreign corporation which transacts business in this state without a certificate of

authority is liable to this state, for the years or parts of years during which it transacted business

in this state without a certificate of authority, in an amount equal to all fees and franchise taxes

which would have been imposed upon the corporation had it duly applied for and received a

certificate of authority to transact business in this state as required by this chapter and

subsequently filed all reports required by this chapter, plus all penalties imposed by this chapter

for failure to pay the fees and franchise taxes. The attorney general shall bring proceedings to

recover all amounts due this state under the provisions of this section.

      (d) The Superior Court has jurisdiction to enjoin any foreign corporation, or any agent of

a foreign corporation, from transacting any business in this state if the corporation fails to comply

with any section of this subchapter applicable to it or if the corporation secured a certificate of the

secretary of state under section 7-1.1-103 on the basis of false or misleading representations. The

attorney general shall, upon his or her own motion or upon the relation of proper parties, proceed

for this purpose by complaint in any county in which the corporation is doing business.

     7-1.1-118. Annual report of domestic and foreign corporations. -- (a) Each domestic

corporation, and each foreign corporation authorized to transact business in this state, shall file,

within the time prescribed by this chapter, an annual report stating:

      (1) The name of the corporation and the state or country under the laws of which it is

incorporated.

      (2) A brief statement of the character of the business in which the corporation is actually

engaged in this state.

      (3) The names and respective addresses of the directors and officers of the corporation.

      (4) A statement of the aggregate number of shares which the corporation has authority to

issue, itemized by classes, par value of shares, shares without par value, and series, if any, within

a class.

      (5) A statement of the aggregate number of issued shares, itemized by classes, par value

of shares, shares without par value, and series, if any, within a class.

      (6) Any additional information that is by the secretary of state.

      (b) The annual report shall be made on forms prescribed and furnished by the secretary

of state, and the information contained therein shall be given as of the date of the execution of the

report. It shall be executed by the corporation by its president, a vice president, secretary, an

assistant secretary, or treasurer, or, if the corporation is in the hands of a receiver or trustee, it

shall be executed on behalf of the corporation by the receiver or trustee.

     7-1.1-119. Filing of annual report of domestic and foreign corporations. -- The

annual report of a domestic or foreign corporation shall be delivered to the secretary of state

between January 1 and the March 1 of each year, except that the first annual report of a domestic

or foreign corporation shall be filed between January 1 and March 1 of the year following the

calendar year in which its certificate of incorporation or its certificate of authority was issued by

the secretary of state. Proof to the satisfaction of the secretary of state that prior to March 1 the

report was deposited in the United States mail in a sealed envelope, properly addressed, with

postage prepaid, is deemed to be a compliance with this requirement. If the secretary of state

finds that the report conforms to the requirements of this chapter, he or she shall file the report. If

he or she finds that it does not conform, he or she shall promptly return the report to the

corporation for any necessary corrections, in which event the penalties subsequently prescribed

for failure to file the report within the time previously provided do not apply, if the report is

corrected to conform to the requirements of this chapter and returned to the secretary of state

within thirty (30) days from the date on which it was mailed to the corporation by the secretary of

state.

     7-1.1-120. Fees and charges collected by secretary of state. -- (a) The secretary of state

shall charge and collect in accordance with the provisions of this chapter:

      (1) Fees for filing documents and issuing certificates.

      (2) Miscellaneous charges.

      (3) License fees.

      (b) The secretary of state shall, between the first and fifteenth day of each month, make

an itemized return, in writing, to the state controller of the amount of all fees and charges

collected by him or her, and pay to the general treasurer all of the state moneys in his or her

hands.

     7-1.1-121. Fees for filing documents and issuing certificates. -- The secretary of state

shall charge and collect for filing:

      (1) Articles of incorporation and issuing a certificate of incorporation, seventy dollars

($70.00).

      (2) Articles of amendment and issuing a certificate of amendment, fifty dollars ($50.00).

      (3) Restated articles of incorporation, seventy dollars ($70.00).

      (4) Articles of merger or consolidation and issuing a certificate of merger or

consolidation, one hundred dollars ($100).

      (5) An application to reserve a corporate name, fifty dollars ($50.00).

      (6) A notice of transfer of a reserved corporate name, fifty dollars ($50.00).

      (7) (i) Filing a statement of change of registered agent and registered office or filing a

statement of change of registered agent, twenty dollars ($20.00).

      (ii) Filing a statement of change of registered office only, without fee.

      (8) A statement of the establishment of a series of shares, ten dollars ($10.00).

      (9) A statement of cancellation of shares, ten dollars ($10.00).

      (10) A statement of reduction of stated capital, ten dollars ($10.00).

      (11) A statement of intent to dissolve, without fee.

      (12) A statement of revocation of voluntary dissolution proceedings, ten dollars

($10.00).

      (13) Articles of dissolution, fifty dollars ($50.00).

      (14) An application of a foreign corporation for a certificate of authority to transact

business in this state and issuing a certificate of authority, one hundred fifty dollars ($150).

      (15) An application of a foreign corporation for an amended certificate of authority to

transact business in this state and issuing an amended certificate of authority, seventy-five dollars

($75.00).

      (16) A copy of an amendment to the articles of incorporation of a foreign corporation

holding a certificate of authority to transact business in this state, fifty dollars ($50.00).

      (17) A copy of articles of merger of a foreign corporation holding a certificate of

authority to transact business in this state, one hundred fifty dollars ($150).

      (18) An application for withdrawal of a foreign corporation and issuing a certificate of

withdrawal, fifty dollars ($50.00).

      (19) An annual report, fifty dollars ($50.00).

      (20) Any other statement or report, except an annual report, of a domestic or foreign

corporation, ten dollars ($10.00).

     7-1.1-122. Miscellaneous charges. -- The secretary of state shall charge and collect:

      (1) For furnishing a certified copy of any document, instrument, or paper relating to a

corporation, fifty cents (50/c) per page and five dollars ($5.00) for the certificate and affixing the

seal to it.

      (2) At the time of any service of process on him or her as resident agent of a corporation,

fifteen dollars ($15.00), which amount may be recovered as taxable costs by the party to the suit

or action making the service if the party prevails in the suit or action.

     7-1.1-123. License fees payable by domestic corporations. -- (a) The secretary of state

shall charge and collect from each domestic corporation license fees, based on the number of

shares which it has authority to issue or the increase in the number of shares which it has

authority to issue, at the time of:

      (1) Filing articles of incorporation;

      (2) Filing articles of amendment increasing the number of authorized shares; and

      (3) Filing articles of merger or consolidation increasing the number of authorized shares

which the surviving or new corporation, if a domestic corporation, has the authority to issue

above the aggregate number of shares which the constituent domestic corporations and

constituent foreign corporations authorized to transact business in this state had authority to issue.

      (b) The license fees are at the rate of (i) one-fifth cent (1/5/c) per share for each

authorized share if the total number of new shares being authorized is seventy-five million

(75,000,000) shares or greater, or (ii) one hundred and sixty dollars ($160) if the total number of

new shares being authorized is less than seventy-five million (75,000,000) shares.

      (c) The license fees payable on an increase in the number of authorized shares is

imposed only on the increased number of shares, and the number of previously authorized shares

is to be taken into account in determining the rate applicable to the increased number of

authorized shares.

     7-1.1-124. License fees payable by foreign corporations. -- (a) The secretary of state

shall charge and collect from each foreign corporation license fees, based on the proportion

represented in this state of the number of shares which it has authority to issue or the increase in

the number of shares which it has authority to issue, at the time of:

      (1) Filing an application for a certificate of authority to transact business in this state;

      (2) Filing articles of amendment which increased the number of authorized shares; and

      (3) Filing articles of merger or consolidation which increased the number of authorized

shares which the surviving or new corporation, if a foreign corporation, has authority to issue

above the aggregate number of shares which the constituent domestic corporations and

constituent foreign corporations authorized to transact business in this state had authority to issue.

      (b) The license fees are at the rate of (i) one-fifth cent (1/5/c) per share if the total

number of new shares being authorized is seventy-five million (75,000,000) shares or greater, or

(ii) one hundred and sixty dollars ($160) if the total number of new shares being authorized is less

than seventy-five million (75,000,000) shares.

      (c) The license fees payable on an increase in the number of authorized shares is

imposed only on the increased number of the shares represented in this state, and the number of

previously authorized shares represented in this state is to be taken into account in determining

the rate applicable to the increased number of authorized shares.

      (d) The number of authorized shares represented in this state is that proportion of its total

authorized shares which the sum of the value of its property located in this state and the gross

amount of business transacted by it at or from places of business in this state bears to the sum of

the value of all of its property, wherever located, and the gross amount of its business, wherever

transacted. The proportion is determined from information contained in the application for a

certificate of authority to transact business in this state or in the application for an amended

certificate of authority to transact business in this state.

     7-1.1-125. -- 7-1.1-127. [Reserved.] --

     7-1.1-128. Penalties imposed upon corporations. -- (a) Each corporation, domestic or

foreign, that fails or refuses to file its annual report for any year within the time prescribed by this

chapter is subject to a penalty of ten percent (10%) of the amount of the franchise tax assessed

against it for the period beginning July 1 of the year in which the report should have been filed.

The penalty shall be assessed by the tax administrator at the time of the assessment of the

franchise tax. If the amount of the franchise tax as originally assessed against the corporation is

subsequently adjusted, the amount of the penalty shall likewise be adjusted to ten percent (10%)

of the amount of the adjusted franchise tax. The amount of the franchise tax and the amount of

the penalty shall be separately stated in any related notice to the corporation.

      (b) Each corporation, domestic or foreign, that fails or refuses to answer truthfully and

fully within the time prescribed by this chapter interrogatories propounded by the secretary of

state in accordance with the provisions of this chapter, is guilty of a misdemeanor and upon

conviction of it may be fined in any amount not exceeding five hundred dollars ($500).

     7-1.1-129. Penalties imposed upon officers and directors. -- Each officer and director

of a domestic or foreign corporation who fails or refuses within the time prescribed by this

chapter to answer truthfully and fully interrogatories propounded to him or her by the secretary of

state in accordance with the provisions of this chapter, or who signs any articles, statement,

report, application, or other document filed with the secretary of state which is known to the

officer or director to be false in any material respect, is guilty of a misdemeanor, and upon

conviction of it may be fined in any amount not exceeding five hundred dollars ($500).

     7-1.1-130. Interrogatories by secretary of state. -- The secretary of state may propound

to any domestic or foreign corporation subject to the provisions of this chapter, and to any of its

officers or directors, any interrogatories that may be reasonably necessary and proper to enable

the secretary of state to ascertain whether the corporation has complied with all the applicable

provisions of this chapter. The interrogatories shall be answered within thirty (30) days after their

mailing, or within any additional time that is fixed by the secretary of state, and the answers to the

interrogatories shall be full and complete and shall be made in writing and under oath. If the

interrogatories are directed to an individual they shall be answered by him or her, and if directed

to a corporation they shall be answered by the president, vice president, secretary, or assistant

secretary of the corporation. The secretary of state need not file any document to which the

interrogatories relate until the interrogatories are answered as provided in these provisions, and

not then if the interrogatory answers disclose that the document is not in conformity with the

provisions of this chapter. The secretary of state shall certify to the attorney general, for any

action that the attorney general deems appropriate, all interrogatories and their answers which

disclose a violation of any of the provisions of this chapter.

     7-1.1-131. Information disclosed by interrogatories. -- Interrogatories propounded by

the secretary of state and the answers to the interrogatories are not open to public inspection nor

shall the secretary of state disclose any facts or information obtained from them except insofar as

the secretary's official duty requires the facts or information to be made public or in the event the

interrogatories or their answers are required for evidence in any criminal proceedings or in any

other action by this state.

     7-1.1-132. Power of secretary of state. -- The secretary of state has the reasonably

necessary power and authority to enable him or her to administer this chapter efficiently and to

perform the duties imposed upon the secretary by this chapter.

     7-1.1-133. Appeal from secretary of state. -- (a) If the secretary of state fails to approve

any articles of incorporation, amendment, merger, consolidation or dissolution, or any other

document required by this chapter to be approved by the secretary of state before the document is

filed in his or her office, the secretary shall, within ten (10) days after the delivery of the

document to him or her, give written notice of his or her disapproval to the person or corporation,

domestic or foreign, delivering the document, specifying the reasons for the disapproval. From

the disapproval the person or corporation may appeal to the superior court of the county in which

the registered office of the corporation is, or is proposed to be, situated by filing with the clerk of

the court a petition setting forth a copy of the articles or other document sought to be filed and a

copy of the written disapproval of the document by the secretary of state; at which time the matter

shall be tried de novo by the court, and the court shall either sustain the action of the secretary of

state or direct the secretary to take any action that the court deems proper.

      (b) If the secretary of state revokes the certificate of authority to transact business in this

state of any foreign corporation pursuant to the provisions of sections 7-1.1-114 and 7-1.1-115, in

addition to the remedy provided in section 7-1.1-115.1, the foreign corporation may likewise

appeal to the superior court of the county where the registered office of the corporation in this

state is situated, by filing with the clerk of the court a petition setting forth a copy of its certificate

of authority to transact business in this state and a copy of the notice of revocation given by the

secretary of state; at that time the matter shall be tried de novo by the court, and the court shall

either sustain the action of the secretary of state or direct the secretary to take any action that the

court deems proper.

      (c) Appeals from all final orders and judgments entered by the superior court under this

section in review of any ruling or decision of the secretary of state may be taken as in other civil

actions.

     7-1.1-134. Certificates and certified copies to be received in evidence. -- All

certificates issued by the secretary of state in accordance with the provisions of this chapter, and

all copies of documents filed in his or her office in accordance with the provisions of this chapter

when certified by the secretary, shall be taken and received in all courts, public offices, and

official bodies as prima facie evidence of the facts stated in them. A certificate by the secretary of

state under the great seal of this state, as to the existence or nonexistence of the facts relating to

corporations shall be taken and received in all courts, public offices, and official bodies as prima

facie evidence of the existence or nonexistence of the facts stated in them.

     7-1.1-135. Forms to be furnished by secretary of state. -- All reports required by this

chapter to be filed in the office of the secretary of state shall be made on forms which shall be

prescribed and furnished by the secretary of state. Forms for all other documents to be filed in the

office of the secretary of state may be furnished by the secretary of state on request for the forms,

but the use of the forms, unless otherwise specifically prescribed in this chapter, is not mandatory.

     7-1.1-136. Unauthorized assumption of corporate powers. -- All persons who assume

to act as a corporation without authority so to do are jointly and severally liable for all debts and

liabilities incurred or arising as a result of that action.

     7-1.1-137. Application to existing corporations organized under general acts. -- The

provisions of this chapter apply to all existing corporations organized under any general act of

this state providing for the organization of corporations for a purpose or purposes for which a

corporation might be organized under this chapter, where the power has been reserved to amend,

repeal, or modify the act under which the corporation was organized and where the act is repealed

by this chapter.

     7-1.1-138. Application to foreign and interstate commerce. -- The provisions of this

chapter apply to commerce with foreign nations and among the several states only insofar as the

provisions are permitted under the constitution of the United States.

     7-1.1-138.1. Applicability to corporations created by special acts. -- The provisions of

this chapter apply to all existing corporations previously or subsequently created by any special

act of the general assembly of a kind that could be organized under this chapter, except insofar as

the provisions are inconsistent with the provisions of any applicable special act passed after May

5, 1920 or with the provisions of any applicable special act passed that are not subject to

amendment or repeal at the will of the general assembly. A corporation created by special act of

the kind that could be organized under this chapter but whose charter is not subject to

amendment, repeal, or modification by the general assembly, may at a called meeting for the

purpose, by a unanimous vote of its stockholders or members, adopt the provisions of this chapter

upon the filing in the office of the secretary of state of a certified copy of the vote, attested by its

president or vice president and its secretary or assistant secretary under its corporate seal, and the

payment to the secretary of state of the fee prescribed by section 7-1.1-123. The corporation shall

subsequently be governed in all respects by the provisions of this chapter and its charter shall

subsequently be subject to amendment or repeal at the will of the general assembly.

     7-1.1-139. Reservation of power. -- The general assembly at all times has power to

prescribe any regulations, provisions, and limitations that it deems advisable, which regulations,

provisions, and limitations are binding on any corporation subject to the provisions of this

chapter. The general assembly has power to amend, repeal, or modify this chapter at pleasure.

     7-1.1-140. Effect of repeal of prior acts. -- The repeal of a prior act by this chapter does

not affect any right accrued or established, or any liability or penalty incurred, under the

provisions of the act, prior to the repeal.

     7-1.1-141. Effect of invalidity of part of this chapter. -- If a court of competent

jurisdiction adjudges to be invalid or unconstitutional any clause, sentence, paragraph, section, or

part of this chapter, the judgment or decree does not affect, impair, invalidate, or nullify the

remainder of this chapter, but the effect is confined to the clause, sentence, paragraph, section, or

part of this chapter adjudged to be invalid or unconstitutional.

     SECTION 2. Title 7 of the General Laws entitled “Corporations, Associations, and

Partnerships” is hereby amended by adding thereto the following chapter:

     CHAPTER 1.2

     RHODE ISLAND BUSINESS CORPORATION ACT

     Part I. General Provisions.

     7-1.2-101. Short title. --This chapter is and may be cited as the “Rhode Island Business

Corporation Act.”

     7-1.2-102. Reservation of power. --The general assembly at all times has power to

prescribe any regulations, provisions, and limitations that it deems advisable, which regulations,

provisions, and limitations are binding on any corporation subject to the provisions of this

chapter. The general assembly has power to amend, repeal, or modify this chapter at pleasure.

     7-1.2-103. Effect of repeal of prior acts. -- The repeal of a prior act by this chapter does

not impair, diminish or affect any right, privilege or immunity accrued or established, any suit

pending, any right of action conferred, or any duty, restriction, liability or penalty imposed or

required, under the provisions of the act, prior to the repeal.

     7-1.2-104. Severability. -- If any provision of this chapter or its application to any person

or circumstance is held invalid by a court of competent jurisdiction, the invalidity does not affect

other provisions or applications of the chapter that can be given effect without the invalid

provision or application, and to this end the provisions of the chapter are severable.

     7-1.2-105. Execution, Filing and Recording of Instruments. - (a) Whenever any

instrument is to be filed with the secretary of state or in accordance with this chapter, the

instrument must be executed as follows:

     (1) The articles of incorporation, and any other instrument to be filed before the election

of the initial board of directors if the initial directors were not named in the articles of

incorporation, must be signed by the incorporator or incorporators (or, in the case of any such

other instrument, such incorporator’s or incorporators’ successors and assigns).

     (2) All other instruments must be signed:

     (i) By any authorized officer of the corporation; or

     (ii) If it appears from the instrument that there are no authorized officers, then by a

majority of the directors or by the director or directors authorized by a majority of the directors;

or

     (iii) If it appears from the instrument that there are no authorized officers or directors,

then by the holders of record of all outstanding shares, or by those holders of record designated

by a majority of all outstanding shares; or

     (b) Whenever this chapter requires any instrument to be acknowledged, such

requirement is satisfied by either:

     (1) The formal acknowledgment by any individual signing the instrument that it is his act

and deed or the act and deed of the corporation, and that the facts stated therein are true. This

acknowledgment must be made before a individual who is authorized by the law of the place of

execution to take acknowledgment; or

     (2) The signature, without more, of the individual or individuals signing the instrument,

in which case such signature or signatures constitutes the affirmation or acknowledgment of the

signatory, under penalties of perjury, that the instrument is that individual’s act and deed or the

act and deed of the corporation, and that the facts stated therein are true.

     (c) Whenever any instrument is to be filed with the secretary of state or in accordance

with this section or chapter, such requirement means that:

     (1) The signed instrument must be delivered to the office of the secretary of state;

     (2) All taxes and fees authorized by law to be collected by the secretary of state in

connection with the filing of the instrument must be tendered to the secretary of state; and

     (3) Upon delivery of the instrument, the secretary of state shall record the date and time

of its delivery. Upon such delivery and tender of the required taxes and fees, the secretary of state

shall certify that the instrument has been filed in the secretary of state’s office by endorsing upon

the signed instrument the word “Filed”, and the date and time of its filing. This endorsement is

the “filing date” of the instrument, and is conclusive of the date and time of its filing in the

absence of actual fraud.

     (d) Any instrument filed in accordance with subsection (c) of this section is effective

upon its filing date. Any instrument may provide that it is not to become effective until a

specified time subsequent to the time it is filed, but not later than the 90th day after the date of its

filing.

     (e) If another section of this chapter specifically prescribes a manner of executing,

acknowledging or filing a specified instrument or a time when that instrument becomes effective

which differs from the corresponding provisions of this section, then such other section governs.

     (f) Whenever any instrument authorized to be filed with the secretary of state under any

provision of this chapter, has been so filed and is an inaccurate record of the corporate action

therein referred to, or was defectively or erroneously executed, sealed or acknowledged, the

instrument may be corrected by filing with the secretary of state a certificate of correction of the

instrument which must be executed, acknowledged and filed in accordance with this section. The

certificate of correction must specify the inaccuracy or defect to be corrected and set forth the

portion of the instrument in corrected form. The corrected instrument must be specifically

designated as such in its heading, specify the inaccuracy or defect to be corrected, and set forth

the entire instrument in corrected form. An instrument corrected in accordance with this section

is effective as of the date the original instrument was filed, except as to those individuals who are

substantially and adversely affected by the correction and as to those individuals the instrument as

corrected is effective from its filing date.

     (g) Notwithstanding that any instrument authorized to be filed with the secretary of state

under this chapter is when filed inaccurately, defectively or erroneously executed, sealed or

acknowledged, or otherwise defective in any respect, the secretary of state has no liability to any

individual for the preclearance for filing, the acceptance for filing or the filing and indexing of

such instrument by the secretary of state.

     (h) Any signature on any instrument authorized to be filed with the secretary of state

under this chapter may be a facsimile or an electronically transmitted signature.

      7-1.2-106. Definitions. - As used in this chapter: (1) “Articles of incorporation” means

the original or restated articles of incorporation and all of their amendments including agreements

of merger.

     (2) “Authorized shares” means the shares of all classes which the corporation is

authorized to issue.

     (3) “Corporation” or “domestic corporation” means a corporation for profit subject to the

provisions of this chapter, except a foreign corporation.

     (4) “Electronic transmission” means any form of communication, not directly involving

the physical transmission of paper, that creates a record that may be retained, retrieved, and

reviewed by a recipient thereof, and that may be directly reproduced in paper form by such a

recipient through an automated process.

     (5) “Employee” includes officers but not directors. A director may accept duties which

also make him an employee.

     (6) “Foreign corporation” means a corporation for profit organized under laws other than

the laws of this state for a purpose or purposes for which a corporation may be organized under

this chapter.

     (7) “Individual” means a natural person.

     (8) “Insolvent” means the inability of a corporation to pay its debts as they become due in

the usual course of its business.

     (9) “Person” means an individual or an entity. An entity includes domestic and foreign

business corporation, domestic and foreign nonprofit corporation; estate; trust; domestic and

foreign unincorporated entity; and state, united States and foreign government.

     (10) “Shares” means the units into which the proprietary interests in a corporation are

divided.

     (11) “Subscriber” means one who subscribes for shares in a corporation, whether before

or after incorporation.

     (12) “Shareholder” means one who is a holder of record of shares in a corporation.

     (13) The singular shall be construed to include the plural, the plural the singular, and the

masculine the feminine, when consistent with the intent of this chapter.

     Part II. Incorporation.

     7-1.2-201. Incorporators and organization of the corporation. - (a) One or more

individuals may act as incorporator or incorporators of a corporation by filing articles of

incorporation for the corporation with the secretary of state.

     (b) After incorporation:

     (1) If initial directors are named in the articles of incorporation, the initial directors shall

hold an organizational meeting, at the call of a majority of the directors, to complete the

organization of the corporation by appointing officers, adopting bylaws, and transacting on any

other business to come before the meeting.

     (2) If initial directors are not named in the articles of incorporation, the incorporator or

incorporators shall hold an organizational meeting at the call of the majority of the incorporators:

     (i) To elect directors and complete the organization of the corporation; or

     (ii) To elect a board of directors who will complete the organization of the corporation.

     (c) The incorporator or incorporators calling a meeting under this section shall give at

least three (3) days’ notice of the meeting by mail to each incorporator. The notice must state the

time and place of the meeting.

     (d) The act or decision done or made by a majority of the incorporators are the act of the

incorporators, provided that an action permitted to be taken at the meeting or meetings of

incorporators under this section may be taken without a meeting if a consent, in writing, stating

the action to be taken, is signed by all of the incorporators.

     7-1.2-202. Articles of incorporation. - (a) The articles of incorporation must state:

     (1) A corporate name that satisfies the requirements of Section 7-1.2-401.

     (2) The total number of shares which the corporation has authority to issue, and if the

corporation is to be authorized to issue more than one class of shares;

     (i) The total number of shares of each class; and

     (ii) A statement of all or any of the designations and the powers, preferences, and rights,

including voting rights, and the qualifications, limitations, or restrictions of them, which are

permitted by the provisions of this chapter in respect of any class or classes of shares of the

corporation and the fixing of which by the articles of association is desired, and an express grant

of the authority as it may then be desired to grant to the board of directors to fix by vote or votes

any of them that may be desired but which is not fixed by the articles.

     (3) The address of its initial registered office, and the name of its initial registered agent

at the address.

     (4) The name and address of each incorporator.

     (b) The articles of incorporation may state:

     (1) A par value of authorized shares or classes of shares.

     (2) Any provisions electing to provide preemptive rights to shareholders pursuant to the

provisions of Section 7-1.2-613.

     (3) Any provision, not inconsistent with law, which the incorporators elect to set forth in

the articles of incorporation for the regulation of the internal affairs of the corporation, including,

but not limited to, a provision eliminating or limiting the personal liability of a director to the

corporation or to its shareholders for monetary damages for breach of the director’s duty as a

director; provided that the provision does not eliminate or limit the liability of a director for:

     (i) Any breach of the director’s duty of loyalty to the corporation or its shareholders;

     (ii) Acts or omissions not in good faith or which involve intentional misconduct or a

knowing violation of law;

     (iii) Liability imposed pursuant to the provisions of Section 7-1.2-811; or

     (iv) Any transaction from which the director derived an improper personal benefit (unless

the transaction is permitted by Section 7-1.2-807); and also including;

     (v) Any provision which under this chapter is required or permitted to be set forth in the

bylaws.

     No provision eliminating or limiting the personal liability of a director will be effective

with respect to causes of action arising prior to the inclusion of the provision in the articles of

incorporation of the corporation.

     (4) If, pursuant to Section 7-1.2-105(d), the corporate existence is to begin at a time

subsequent to the issuance of the certificate of incorporation by the secretary of state, the date

when corporate existence begins.

     (c) The provisions permitted by subsection (b)(3) may also be included in the articles of

incorporation or legislative charter of any existing or future financial institution, insurance

company, public utility, or other quasi public corporation having purposes enumerated as

exceptions to this chapter in Section 7-1.2-301.

     (d) The period of duration of a corporation is perpetual unless otherwise stated in the

articles of incorporation.

     (e) It is not necessary to set forth in the articles of incorporation any of the corporate

powers enumerated in this chapter.

     7-1.2-203. Bylaws. - (a) The bylaws may contain any provisions for the regulation and

management of the affairs of the corporation not inconsistent with law or the articles of

incorporation. The initial bylaws of a corporation must be adopted by its incorporators or by its

board of directors at its organization meeting. Subsequently, the bylaws may be amended by the

shareholders, or, unless otherwise provided in the articles of incorporation or bylaws, by the

board of directors, but any amendment to the bylaws by the board of directors may be changed by

the shareholders.

     (b) Emergency Bylaws.

     (1) The board of directors of any corporation may adopt emergency bylaws, subject to

repeal or change by action of the shareholders, which are, notwithstanding any different provision

elsewhere in this chapter or in the articles of incorporation or bylaws, operative during any

emergency in the conduct of the business of the corporation resulting from an attack on the

United States or any nuclear or atomic disaster. The emergency bylaws may make any provision

that may be practical and necessary for the circumstances of the emergency, including provisions

that:

     (i) A meeting of the board of directors may be called by any officer or director in any

manner and under conditions prescribed in the emergency bylaws;

     (ii) The director or directors in attendance at the meeting, or any greater number fixed by

the emergency bylaws, constitutes a quorum; and

     (iii) The officers or other individuals designated on a list approved by the board of

directors before the emergency, all in the order of priority and subject to the conditions, and for a

period of time (not longer than reasonably necessary after the termination of the emergency) that

may be provided in the emergency bylaws or in the resolution approving the list, are, to the extent

required to provide a quorum at any meeting of the board of directors, deemed directors for the

meeting.

     (2) The board of directors, either before or during any emergency, may provide, and from

time to time modify, lines of succession in the event that during an emergency any or all officers

or agents of the corporation are for any reason rendered incapable of discharging their duties.

     (3) The board of directors, either before or during any emergency, may, effective in the

emergency, change the head office or designate several alternative head offices or regional

offices, or authorize the officers so to do.

     (4) To the extent not inconsistent with any adopted emergency bylaws, the bylaws of the

corporation remain in effect during any emergency, and upon its termination the emergency

bylaws cease to be operative.

     (5) Unless otherwise provided in emergency bylaws, notice of any meeting of the board

of directors during any emergency may be given only to those directors that it may be feasible to

reach at the time and by any means that may be feasible at the time, including publication or

radio.

     (6) To the extent required to constitute a quorum at any meeting of the board of directors

during any emergency, the officers of the corporation who are present are, unless otherwise

provided in emergency bylaws, deemed, in order of rank and within the same rank in order of

seniority, directors for the meeting.

     (7) No officer, director, or employee acting in accordance with any emergency bylaws is

liable except for willful misconduct. No officer, director, or employee is liable for any action

taken by him in good faith in an emergency in furtherance of the ordinary business affairs of the

corporation even though not authorized by the bylaws then in effect.

     Part III. Purposes and Powers.

     7-1.2-301. Purposes. - Corporations may be organized under this chapter for any lawful

purpose or purposes, except for the purpose of carrying on within this state the business of a

bank, savings bank, trust company, building and loan association, loan and investment company,

safe deposit company, railroad, electric railroad or street railway company, telegraph or telephone

company, gas or electric light, heat or power company, canal, aqueduct, or water company,

turnpike company, or any corporation which now has or may subsequently have the right to take

or condemn land or other property within this state under the power of eminent domain, or to

exercise or acquire franchises in streets or highways of this state, and further except for the

purpose of rendering the professional services specified in chapter 5.1 of this title must be

organized under the provisions of that chapter.

      7-1.2-302. Powers. - (a) In addition to the powers enumerated below, every corporation,

its officers, directors and shareholders possess and may exercise all the powers and privileges

granted by this chapter or by any other law or by its articles of incorporation, together with any

powers incidental thereto, so far as such powers and privileges are necessary or convenient to the

conduct, promotion or attainment of its business.

     (b) Each corporation has power to:

     (1) Have perpetual existence unless a limited period of duration is stated in its articles of

incorporation.

     (2) Sue and be sued, complain and defend, in its corporate name.

     (3) Have a corporate seal which may be altered at pleasure, and to use the seal by causing

it, or a facsimile of it, to be impressed or affixed or reproduced in any other manner.

     (4) Purchase, take, receive, lease, or otherwise acquire, own, hold, improve, use, and

otherwise deal in and with, real or personal property, or any interest in that property, wherever

situated.

     (5) Sell, convey, mortgage, pledge, lease, exchange, transfer, and otherwise dispose of all

or any part of its property and assets.

     (6) Lend money and use its credit to assist its employees.

     (7) Purchase, take, receive, subscribe for, or otherwise acquire, own, hold, vote, use,

employ, sell, mortgage, lend, pledge, or otherwise dispose of, and otherwise use and deal in and

with, shares or other interests in, or obligations of, other domestic or foreign corporations,

associations, partnerships, limited liability companies or individuals, or direct or indirect

obligations of the United States or of any other government, state, territory, governmental district

or municipality or of any of their instrumentalities.

     (8) Make contracts and guarantees and incur liabilities, borrow money at the rate of

interest that the corporation may determine, issue its notes, bonds, and other obligations, and

secure any of its obligations by mortgage or pledge of all or any of its property, franchises, and

income.

     (9) Lend money for its corporate purposes, invest and reinvest its funds, and take and

hold real and personal property as security for the payment of the funds loaned or invested.

     (10) Conduct its business, carry on its operations, and have offices and exercise the

powers granted by this chapter, within or without this state.

     (11) Elect or appoint officers and agents of the corporation, and define their duties, and

fix their compensation.

     (12) Make and alter bylaws, not inconsistent with its articles of incorporation or with the

laws of this state, for the administration and regulation of the affairs of the corporation.

     (13) Make donations for the public welfare or for charitable, scientific, or educational

purposes.

     (14) Transact any lawful business which the board of directors finds will aid

governmental authority.

     (15) Pay pensions and establish pension plans, pension trusts, profit sharing plans, stock

bonus plans, stock option plans, and other incentive plans for any or all of its directors, officers,

and employees.

     (16) Provide insurance for its benefit on the life of any of its directors, officers, or

employees, or on the life of any shareholder for the purpose of acquiring at his death shares of its

share owned by the shareholder.

     (17) Be a promoter, partner, member, associate, or manager of any partnership, limited

liability company, joint venture, trust, or other enterprise.

     (18) Make payments or donations, or do any other act, not inconsistent with law, that

furthers the business and affairs of the corporation.

     (19) Indemnify any individual pursuant to Section 7-1.2-814.

     (20) Make guarantees, although not in furtherance of its corporate purposes, when

authorized at a meeting of shareholders by the affirmative vote of the holders of a majority of the

shares of the corporation entitled to vote on guarantees, or a greater percentage that is provided in

the articles of incorporation or bylaws.

     (21) If authorized by a like vote, to mortgage, pledge, or give a security interest in all or

any of its property, franchises, and income to secure a guarantee or to secure obligations other

than its own.

     (c) Every corporation is governed by the provisions and be subject to the restrictions and

liabilities contained in this chapter.

     7-1.2-303. Defense of Ultra Vires. - No act of a corporation and no conveyance or

transfer of real or personal property to or by a corporation is invalid because the corporation was

without capacity or power to do the act or to make or receive the conveyance or transfer, but the

lack of capacity or power may be asserted:

     (a) In a proceeding by a shareholder against the corporation to enjoin the doing of any act

or the transfer of real or personal property by or to the corporation. If the unauthorized act or

transfer sought to be enjoined is being, or is to be, performed or made pursuant to a contract to

which the corporation is a party, the court may, if all of the parties to the contract are parties to

the proceeding and if it deems the same to be equitable, set aside and enjoin the performance of

the contract, and in so doing may allow to the corporation or to the other parties to the contract, as

the case may be, compensation for the loss or damage sustained by either of them which may

result from the action of the court in setting aside and enjoining the performance of the contract,

but anticipated profits to be derived from the performance of the contract shall not be awarded by

the court as a loss or damage sustained.

     (b) In a proceeding by the corporation, whether acting directly or through a receiver,

trustee, or other legal representative, or through shareholders in a representative suit, against the

incumbent or former officers or directors of the corporation.

     (c) In a proceeding by the attorney general, as provided in this chapter, to dissolve the

corporation, or in a proceeding by the attorney general to enjoin the corporation from the

transaction of unauthorized business.

     Part IV. Name.

     7-1.2-401. Corporate name. - (a) The corporate name:

     (1) Must contain the word “corporation,” “company,” “incorporated,” or “limited,” or an

abbreviation of one of these words.

     (2) Is not be the same as, or deceptively similar to, the name of any entity on file with the

secretary of state or a name the exclusive right to which is, at the time filed, reserved or registered

in the manner provided in this chapter, or the name of a corporation, whether business or

nonprofit, limited partnership, limited liability partnership or limited liability company which has

in effect a registration of its name as provided in this title, subject to the following:

     (b) This provision does not apply if the applicant files with the secretary of state a

certified copy of a final decree of a court of competent jurisdiction establishing the prior right of

the applicant to the use of the name in this state.

     (c) The name may be the same as the name of a corporation or other association the

certificate of incorporation or organization of which has been revoked by the secretary of state as

permitted by law and the revocation has not been withdrawn within one year from the date of the

revocation.

     (d) A corporation with which another corporation, domestic or foreign, is merged, or

which is formed by the reorganization of one or more domestic or foreign corporations or upon a

sale, lease, or other disposition to, or exchange with, a domestic corporation of all or substantially

all the assets of another corporation, domestic or foreign, including its name, may have the same

name as that used in this state by any of the corporations if at the time the other corporation was

organized under the laws of, or is authorized to transact business in, this state.

     7-1.2-402. Fictitious business name. - (a) Any corporation organized and existing under

the laws of this state or authorized to transact business in this state may transact business in this

state under a fictitious name, provided that it files a fictitious business name statement in

accordance with this section prior to the time it commences to transact the business under the

fictitious name.

     (b) The fictitious business name statement must be filed with the secretary of state on

forms to be furnished by the secretary of state and must be executed by an authorized officer of

the corporation and must state:

     (1) The fictitious business name to be used;

     (2) The name of the applicant corporation and the state or territory under the laws of

which it is incorporated, the date of its incorporation, and a brief statement of the business in

which it is engaged; and

     (3) The address of its registered office within the state.

     (c) The fictitious business name statement expires upon the filing of the statement of

abandonment of use of a fictitious business name registered in accordance with this section or

upon the dissolution of the applicant corporation.

     (d) The statement of abandonment of use of a fictitious business name under this section

may be filed with the secretary of state on forms furnished by the secretary of state and must be

executed by an authorized officer of the corporation and must state:

     (1) The fictitious business name being abandoned;

     (2) The date on which the original fictitious business name statement being abandoned

was filed;

     (3) The name of the applicant corporation and the state or territory under the laws of

which it is incorporated; and

     (4) The address of its registered office within the state.

     (e) No domestic or foreign corporation transacting business under a fictitious business

name contrary to the provisions of this section, or its assignee, may maintain any action upon or

on account of any contract made, or transaction had, in the fictitious business name in any court

of this state until a fictitious business name statement has been filed in accordance with this

section.

     (f) No corporation may be permitted to transact business under a fictitious business name

pursuant to this section which is the same as, or deceptively similar to, the name of any domestic

corporation, any domestic limited partnership, domestic limited liability partnership or any

domestic limited liability company existing under the laws of this state, or the name of any

foreign corporation, foreign limited partnership, foreign limited liability partnership or foreign

limited liability company authorized to transact business in the state, or any corporate name filed,

reserved or registered under this title.

     7-1.2-403. Reserved name. - (a) The exclusive right to the use of a corporate name may

be reserved by:

     (1) Any individual intending to organize a corporation under this chapter.

     (2) Any domestic corporation intending to change its name.

     (3) Any foreign corporation intending to make application for a certificate of authority to

transact business in this state.

     (4) Any foreign corporation authorized to transact business in this state and intending to

change its name.

     (5) Any individual intending to organize a foreign corporation and intending to have the

corporation make application for a certificate of authority to transact business in this state.

     (b) The reservation is made by filing with the secretary of state an application to reserve a

specified corporate name, executed by the applicant. If the secretary of state finds that the name

is available for corporate use, the secretary of state shall reserve the name for the exclusive use of

the applicant for a non-renewable period of one hundred and twenty (120) days.

     (c) The right to the exclusive use of a specified corporate name so reserved may be

transferred to any other person by filing in the office of the secretary of state a notice of the

transfer, executed by the applicant for whom the name was reserved, and specifying the name and

address of the transferee.

     7-1.2-404. Registered name. - (a) Any corporation organized and existing under the laws

of any state or territory of the United States may register its corporate name under this chapter,

provided its corporate name is not the same as, or deceptively similar to, the name of any

domestic corporation, limited partnership, limited liability partnership or limited liability

company existing under the laws of this state, or the name of any foreign corporation, limited

partnership, limited liability partnership or limited liability company authorized to transact

business in this state, or any corporate name reserved, filed or registered under this title.

     (b) The registration is made by:

     (1) Filing with the secretary of state:

     (i) An application for registration executed by an authorized officer of the corporation,

stating the name of the corporation, the state or territory under the laws of which it is

incorporated, the date of its incorporation, a statement that it is carrying on or doing business, and

a brief statement of the business in which it is engaged; and

     (ii) A certificate stating that the corporation is in good standing under the laws of the state

or territory wherein it is organized, executed by the secretary of state of the state or territory or by

any other official that may have custody of the records pertaining to corporations; and

     (2) Paying to the secretary of state a registration fee.

     (c) The registration is effective for a period of one year from the effective date of the

application.

     (d) A corporation, which has in effect a registration of its corporate name, may renew the

registration from year to year by annually filing an application for renewal stating the facts

required to be stated in an original application for registration and a certificate of good standing

as required for the original registration. A renewal application must be filed prior to the

expiration of the one-year period from the filing of an original application for registration or its

last renewal and extends the registration for the following year.

     Part V. Office and Agent.

     7-1.2-501. Registered office and registered agent - Designation of registered agent

without authority. - (a) Each corporation shall have and continuously maintain in this state:

     (1) A registered office, which may be, but need not be, the same as its place of business.

     (2) A registered agent, who may be (i) an individual resident in this state, (ii) a domestic

corporation, a domestic limited partnership, a domestic limited liability partnership, a domestic

limited liability company, or (iii) a foreign corporation, a foreign limited partnership, a foreign

limited liability partnership or a foreign limited liability company authorized to transact business

in this state, in each case, having a business office identical with the office of such registered

agent which generally is open during normal business hours to accept service of process and

otherwise perform the functions of a registered agent; provided, however, that in the case where

the registered agent of a corporation is an attorney, the business address of the agent need not be

identical with the registered office, but may be the usual business address of the attorney.

     (b) Any incorporator, officer, agent, or servant of a corporation, who designates a

registered agent for that corporation without the registered agent’s authority, is guilty of a

misdemeanor and, upon conviction, may be punished by a fine of not more than one thousand

dollars ($1,000) or by imprisonment of not more than one (1) year, or both.

     7-1.2-502. Change of registered office or registered agent. - (a) A corporation may

change its registered office or change its registered agent, or both, upon filing in the office of the

secretary of state a statement stating:

     (1) The name of the corporation.

     (2) The address of its then registered office.

     (3) If the address of its registered office has changed, the new address of the registered

office.

     (4) The name of its then registered agent.

     (5) If its registered agent has changed, the name of its successor registered agent.

     (6) The address of its registered office and the address of the business office of its

registered agent, as changed.

     (b) The statement must be executed by the corporation by its authorized representative,

and delivered to the secretary of state. If the secretary of state finds that the statement conforms

to the provisions of this chapter, the secretary of state shall file the statement in his office, and

upon that filing or upon a later date not more than thirty (30) days after the filing, as is set forth in

the statement, the change of address of the registered office, or the appointment of a new

registered agent, or both, as the case may be, becomes effective.

     (c) Any registered agent of a corporation may resign as an agent upon filing a written

notice of the resignation with the secretary of state, who shall immediately notify the corporation

of the resignation at its registered office. The appointment of the agent terminates upon the

expiration of thirty (30) days after receipt of the notice by the secretary of state.

     (d) If a registered agent changes his or its business address to another place within the

state, he or it may change the address and the address of the registered office of any corporations

of which he or it is a registered agent by filing a statement as required above, except that it need

be signed only by the registered agent and need not be responsive to subsection (a)(5) and must

recite that a copy of the statement has been mailed to each corporation.

     7-1.2-503. Service of process on corporation. - (a) The registered agent appointed by a

corporation is an agent of the corporation upon whom any process, notice, or demand required or

permitted by law to be served upon the corporation may be served.

     (b) Whenever a corporation fails to appoint or maintain a registered agent in this state, or

whenever its registered agent cannot with reasonable diligence be found at the registered office,

then the secretary of state is an agent of the corporation upon whom any process, notice, or

demand may be served. Service on the secretary of state of any process, notice, or demand is

made by delivering to and leaving with him or with any clerk having charge of the corporation

department of his office, duplicate copies of the process, notice, or demand. In the event any

process, notice, or demand is served on the secretary of state, the secretary of state shall

immediately forward one of the copies by certified mail, addressed to the corporation at its

registered office. Any service upon the secretary of state is returnable in not less than thirty (30)

days.

     (c) The secretary of state shall maintain a record of any such service setting forth the

name of the plaintiff and defendant, the title, docket number and nature of the proceeding in

which process has been served upon the Secretary of State, the fact that service has been effected

pursuant to this subsection, the return date thereof, and the day and hour when the service was

made. The secretary of state shall not be required to retain such information for a period longer

than five (5) years from receipt of the service of process.

     (d) Nothing contained in these provisions limits or affects the right to serve any process,

notice, or demand required or permitted by law to be served upon a corporation in any other

manner permitted by law.

     Part VI. Shares Issuance and Distributions.

     7-1.2-601. Right of corporation to acquire and, dispose of and cancel its own shares.

- (a) Unless a corporation’s articles of incorporation provide otherwise, subject to subsection (f),

a corporation may at any time, by resolution of its board of directors, redeem purchase, take,

receive, or otherwise acquire, hold, own, pledge, transfer, or dispose of its own shares.

     (b) In this Section 7-1.2-601, “redeemable shares” means shares issued pursuant to

Section 7-1.2-602(c)(1). When redeemable shares are called for redemption, those shares are not

outstanding shares for the purpose of voting or determining the total number of shares entitled to

vote on any matter on and after the date on which written notice of redemption has been sent to

holders thereof and a sum sufficient to redeem such shares has been set aside to pay the

redemption price to the holders of the shares upon surrender of certificates therefor.

     (c) When redeemable shares are redeemed or purchased by the corporation, the

redemption or purchase effects a cancellation of the shares and a statement of cancellation must

be filed pursuant to subsection (e).

     (d) When shares of a corporation other than redeemable shares are purchased, a

corporation may, at any time, by resolution of its board of directors, cancel all or any part of the

shares of the corporation of any class or series reacquired by it by filing a statement of

cancellation as provided in subsection (e).

     (e) A statement of cancellation adopted by the board of directors must be delivered to the

secretary of state for filing as follows:

     (1) The statement of cancellation shall be executed by an authorized officer of the

corporation, and must state:

     (i) The name of the corporation.

     (ii) The number of shares canceled through redemption or purchase, itemized by classes

and series.

     (iii) The aggregate number of issued shares, itemized by classes and series, after giving

effect to the cancellation.

     (iv) If the articles of incorporation provide that the canceled shares are not to be reissued,

then the number of shares which the corporation has authority to issue, itemized by classes and

series, after giving effect to the cancellation.

     (2) An original statement of cancellation must be delivered to the secretary of state. If

the secretary of state finds that the statement of cancellation conforms to law, the secretary of

state shall, when all fees and franchise taxes have been paid:

     (i) Endorse on the original the word “Filed”, and the month, day, and year of the filing.

     (ii) File the original in his office.

     (3) Upon filing of the statement of cancellation, the shares are restored to the status of

authorized but unissued shares unless the articles of incorporation provide that the shares, when

redeemed or purchased, are not to be reissued, in which case the filing of the statement of

cancellation constitutes an amendment to the articles of incorporation and reduces the number of

shares of the class canceled which the corporation is authorized to issue by the number of shares

canceled.

     (f) No redemption or purchase of shares may be made by a corporation if, after giving it

effect:

     (1) The corporation would be insolvent; or

     (2) The corporation’s total assets would be less than the sum of its total liabilities plus

(unless the articles of incorporation permit otherwise) the amount that would be needed, if the

corporation were to be dissolved at the time of the redemption, to satisfy the preferential rights

upon dissolution of shareholders whose preferential rights are superior to those redeeming shares

(unless such preferential rights are waived by a majority of the shareholders entitled to such

preferential rights, voting by class).

     The board of directors may base a determination that a redemption is not prohibited under

subsection (f) either on financial statements prepared on the basis of accounting practices and

principles that are reasonable in the circumstances or on a fair valuation or other method that is

reasonable in the circumstances.

     (g) Nothing contained in this section is construed to forbid the cancellation of shares in

any other manner permitted by this chapter.

     7-1.2-602. Authorized shares; shares in classes or series; issuance of shares. - (a)

Every corporation has the power to create and issue the number of shares stated in its articles of

incorporation or any amendment thereto.

     (b) Classes and series. As stated in the articles of incorporation or in any amendment

thereto, or in the resolution or resolutions providing for the issue of such shares adopted by the

board of directors pursuant to authority expressly vested in it by the provisions of its articles of

incorporation, a corporation may issue one or more classes of shares, including one or more

classes of common shares, or one or more series of shares within any class thereof, any or all of

which classes or series of shares may be certificated or uncertificated, with par value or without

par value, and which classes or series may have such voting powers, full or limited, or no voting

powers, and such designations, preferences and relative, participating, optional or other special

rights, and qualifications, limitations or restrictions thereof as are stated and expressed in the

articles of incorporation or any amendment thereto, or in the resolution or resolutions providing

for the issue of such shares adopted by the board of directors pursuant to the authority expressly

vested in it by the provisions of its articles of incorporation.

     (c) Without limiting the authority contained in these provisions, a corporation, when

provided for in its articles of incorporation, may issue shares of preferred or special classes or

series:

     (1) Redeemable for cash, property, promissory notes or rights, including securities of any

other corporation, at the option of either the holder or the corporation or upon the happening of a

specified event, at the time or times, at the price or prices, or the rate or rates, and with the

adjustments stated and expressed or provided for in the articles of incorporation or any

amendment thereto, or in the vote or votes providing for the issuance of the shares adopted by the

board of directors as previously provided; provided, however, that immediately following any

such redemption the corporation must have outstanding one or more shares of one or more classes

or series, which share, or shares together, have unlimited voting rights.

     (2) Entitling the holders of the shares to cumulative, noncumulative, or partially

cumulative dividends.

     (3) Having preference over any other class or classes or series of shares as to the payment

of dividends.

     (4) Having preference in the assets of the corporation over any other class or classes or

series of shares upon the voluntary or involuntary liquidation of the corporation.

     (5) To the extent not inconsistent with this chapter, having limited or no voting rights, or

having special voting rights including the power to elect one or more directors.

     (6) Convertible into, or exchangeable for, at the option of either the holder or the

corporation or upon the happening of a specified event, shares of any other class or classes or any

other series of shares of the corporation, at such price or prices or at such rate or rates of

exchange and with such adjustments as are stated in the articles of incorporation or in the

resolution or resolutions providing for the issuance of such shares adopted by the board of

directors.

     (d) If the articles of incorporation expressly vest authority in the board of directors, then,

to the extent that the articles of incorporation have not established series and fixed and

determined the variations in the relative rights and preferences as between the series, the board of

directors has authority to divide any or all of the classes into series and, within the limitations, if

any, stated in the articles of incorporation, to fix and determine the relative rights and preferences

of the shares of any series established.

     (e)(1) Open-End Investment Company. Notwithstanding the provisions of subsections

(a) and (b) of this section, the board of directors of a corporation that is registered or intends to

register as an open-end investment company under the Investment Company Act of 1940, as

heretofore or hereafter amended, after the registration as an open-end company takes effect, may

increase or decrease the aggregate number of shares or the number of shares of any class or series

that the corporation has authority to issue unless a provision has been included in the charter of

the corporation after July 1, 2001 prohibiting such an action by the board of directors to increase

or decrease the aggregate number of shares or the number of shares of any class or series that the

corporation has authority to issue.

     (2) Conditional license of franchise. Any shares of a corporation which holds (directly or

indirectly) a license or franchise from a governmental agency to conduct its business or is a

member of a national securities exchange, which license, franchise or membership is conditioned

upon some or all of the holders of its shares possessing prescribed qualifications may be made

subject to redemption by the corporation to the extent necessary to prevent the loss of such

license, franchise or membership or to reinstate it.

     (f) Dividends. The holders of preferred or special shares of any class or of any series of

shares are entitled to receive dividends at the rates, on the conditions and at the times that are

stated and expressed in the articles of incorporation or in the vote or votes providing for the issue

of the shares adopted by the board of directors as previously provided, payable in preference to,

or in relation to, the dividends, payable on any other class or classes of shares, or of any other

series of shares, and cumulative, non-cumulative or partially cumulative as is stated and

expressed. When dividends upon the preferred and special shares, if any, to the extent of the

preferences to which the shares are entitled, have been paid or declared and set apart for payment,

a dividend on the remaining class or classes or series of shares may then be paid out of the

remaining assets of the corporation available for dividends.

     (g) Rights upon liquidation. The holders of the preferred or special shares of any class or

of any series of shares are entitled to the rights upon the dissolution of, or upon any distribution

of the assets or liquidation, voluntary or involuntary, of the corporation as are stated and

expressed in the articles of incorporation or in the vote or votes providing for the issue of the

shares adopted by the board of directors as previously provided.

     (h) Facts ascertainable outside the articles of incorporation. Any of the voting powers,

designations, preferences, rights and qualifications, limitations or restrictions of any class or

series of shares may be made dependent upon facts ascertainable outside the articles of

incorporation or outside the resolution or resolutions providing for the issue of such shares

adopted by the board of directors pursuant to authority expressly vested in it by its articles of

incorporation, provided that the manner in which such facts operate upon the voting powers,

designations, preferences, rights and qualifications, limitations or restrictions of such class or

series of shares is clearly and expressly set forth in the articles of incorporation or in the

resolution or resolutions providing for the issue of such shares adopted by the board of directors.

The term “facts,” as used in this subsection, includes, but is not limited to, the occurrence of any

event, including a determination or action by any person, including the corporation.

     (h) Amendment of rights and restrictions by board of directors. Subject to subsection (i),

unless otherwise provided in the articles of incorporation, if no shares have been issued of a class

or series established by resolution of the board of directors, the voting powers, designations,

preferences, and relative, participating optional or other rights, if any or the qualifications,

limitations or restrictions thereof, may be amended by a resolution or resolutions adopted by the

board of directors.

     (i)(1) Issuance. Before any corporation issues any shares of any class or of any series of

any class of which the voting powers, designations, preferences, and relative, participating,

optional, or other rights, if any, or the qualifications, limitations, or restrictions of the share, if

any, have not been stated in the articles of incorporation but are provided for in a vote or votes

adopted by the board of directors pursuant to authority expressly vested in it by the provisions of

the articles of incorporation, a certificate presenting a copy of the vote or votes and the number of

shares of the class or series must be signed by an authorized officer of the corporation and filed in

accordance with Section 7-1.2-105. Upon the filing the certificate constitutes an amendment to

the articles of incorporation.

     (2) Increase or decrease of shares. Unless otherwise provided in any vote or votes, the

number of shares of any class or series as stated in the vote or votes may be increased or

decreased (but not below the number of shares then outstanding) by a certificate likewise made,

signed, and filed presenting a statement that a specified increase or decrease in the number of

shares had been authorized and directed by a vote or votes likewise adopted by the board of

directors. If the number of shares is decreased, the number of shares specified in the certificate

resume the status which they had before to the adoption of the prior resolution.

     7-1.2-603. Subscription for shares. - (a) A subscription for shares entered into before

incorporation is irrevocable for a period of six (6) months unless the subscription agreement

provides a longer or shorter period or all the subscribers agree to revocation. A subscription for

shares is not be enforceable against a subscriber unless in writing and signed by the subscriber or

by an agent of the subscriber.

     (b) The board of directors may determine the payment terms of subscriptions for shares

that were entered into before incorporation, unless the subscription agreement specifies them. A

call for payment by the board of directors must be uniform so far as practicable as to all shares of

the same class or series, unless the subscription agreement specifies otherwise.

     (c) Shares issued pursuant to subscriptions entered into before incorporation are fully

paid and nonassessable when the corporation receives the consideration specified in the

subscription agreement.

     (d) If a subscriber defaults in payment of money or property under a subscription

agreement entered into before incorporation, the corporation may collect the amount owed as any

other debt. Alternatively, unless the subscription agreement provides otherwise, the corporation

may rescind the agreement and may sell the shares if the debt remains unpaid more than 20 days

after the corporation sends written demand for payment to the subscriber.

     (e) A subscription agreement entered into on or after incorporation is a contract between

the subscriber and the corporation subject to Section 7-1.2-604.

     7-1.2-604. Issuance of and consideration for shares. - (a) Shares with par value may

be issued for such consideration having a value not less than the par value thereof, as determined

from time to time by the board of directors, or by the shareholders if the articles of incorporation

so provides.

     (b) Shares without par value may be issued for such consideration as is determined from

time to time by the board of directors, or by the shareholders if the articles of incorporation so

provides.

     (c) The board of directors may authorize shares to be issued for consideration consisting

of any tangible or intangible property or benefit to the corporation, including cash, promissory

notes, services performed, contracts for services to be performed, or other securities of the

corporation.

     (d) Before the corporation issues shares, the board of directors must determine that the

consideration received or to be received for shares to be issued is adequate. The determination by

the board is conclusive insofar as the adequacy of consideration for the issuance of the shares

relates to whether the shares are validly issued, fully paid and nonassessable.

     (e) When the corporation receives the consideration for which the board of directors

authorized the issuance of shares, the shares issued therefor are fully paid and nonassessable.

     (f) The corporation may place in escrow shares issued for a contract for future services or

benefits or a promissory note, or make other arrangements to restrict the transfer of the shares,

and may credit distributions in respect of the shares against their purchase price, until the services

are performed, the note is paid, or the benefits received. If the services are not performed, the

note is not paid, or the benefits are not received, the shares escrowed or restricted and the

distributions credited may be cancelled in whole or part.

     7-1.2-605. Par value per share. -- Solely for the purpose of any statute or regulation

imposing any tax or fee based upon the capitalization of a corporation, unless otherwise stated in

the articles of incorporation, all authorized shares of a corporation organized under this chapter

are deemed to have a nominal or par value of one cent ($0.01) per share. If any federal or other

statute or regulation applicable to a particular corporation requires that the shares of such

corporation have a par value, such shares have the par value determined by the board of directors

in order to satisfy the requirements of such statute or regulation.

     7-1.2-606. Share rights and options. - Subject to any provisions in respect to rights and

options stated in its articles of incorporation, a corporation may create and issue, whether or not

in connection with the issuance and sale of any of its shares or other securities, rights or options

entitling the holders to purchase from the corporation shares of any class or classes. Those rights

or options are evidenced, and the recipients thereof designated, in any manner that the board of

directors approves and, subject to the provisions of the articles of incorporation, shall state the

terms upon which, the time or times within which and the price or prices at which the shares may

be purchased from the corporation upon the exercise of any right or option. In the absence of

fraud in the transaction, the judgment of the board of directors as to the adequacy of the

consideration received for the rights or options is conclusive.

     7-1.2-607. Expenses of organization, reorganization and financing. - The reasonable

charges and expenses of organization or reorganization of a corporation, and the reasonable

expenses of and compensation for the sale or underwriting of its shares, may be paid or allowed

by the corporation out of the consideration received by it in payment for its shares without

rendering the shares not fully paid or assessable.

     7-1.2-608. Form and Content of Certificates. -- (a) The shares of a corporation may but

need not be represented by certificates as determined by the Board of Directors. Every holder of

shares represented by certificates and upon request every holder of uncertificated shares is

entitled to have a certificate signed by the officer or officers designated for the purpose by the

bylaws of the corporation, and in absence of any designation, by the chairperson or the vice

chairperson of the board of directors, or the president or a vice president, and by the treasurer or

the assistant treasurer, or the secretary or an assistant secretary of the corporation, representing

the number of shares registered in certificate form and may be sealed with the seal of the

corporation or a facsimile of the seal. Any or all of the signatures on the certificate may be a

facsimile. In case any officer, transfer agent, or registrar who has signed or whose facsimile

signature has been placed upon the certificate has ceased to be the officer, transfer agent, or

registrar before the certificate is issued, it may be issued by the corporation with the same effect

as if he were the officer, transfer agent, or registrar at the date of its issue.

     (b) Every certificate representing shares issued by a corporation which is authorized to

issue shares of more than one class must state upon the face or back of the certificate, or state that

the corporation will furnish to any shareholder upon request and without charge, a full statement

of the designations, preferences, limitations, and relative rights of the shares of each class

authorized to be issued and, if the corporation is authorized to issue any preferred or special class

in series, the variations in the relative rights and preferences between the shares of each series so

far as the series have been fixed and determined and the authority of the board of directors to fix

and determine the relative rights and preferences of subsequent series.

     (c) Each certificate representing shares must state upon the face of the certificate:

     (1) That the corporation is organized under the laws of this state.

     (2) The name of the person to whom issued.

     (3) The number and class of shares, and the designation of the series, if any, which the

certificate represents.

     (4) The par value of each of the shares, if any.

     (d) No certificate may be issued for any share until the share is fully paid.

     (e) Within a reasonable time after the issuance or transfer of uncertificated shares, the

corporation shall send to the registered owner of the shares a written notice containing the

information and statements required to be presented or stated on certificates pursuant to

subsections (b) and (c) and Section 7-1.2-609(b).

     (f) Except as otherwise expressly provided by law, the rights and obligations of the

holders of uncertificated shares and the rights and obligations of the holders of certificates

representing shares of the same class and series are identical.

     7-1.2-609. Share transfer and ownership restrictions. - (a) The shares of a corporation

are personal property and are transferable in accordance with the provisions of Section 6A-8-204,

as amended from time to time, except as may otherwise be provided in this chapter.

     (b) The articles of incorporation, bylaws, an agreement among all or less than all of the

shareholders, or an agreement between all or less than all of the shareholders and the corporation

may impose restrictions on the transfer or registration of transfer of shares of the corporation. A

restriction does not affect shares issued before the restriction was adopted unless the holders of

the shares are parties to the restriction agreement or voted in favor of the restriction.

     (c) A restriction on the transfer or registration of transfer of shares is valid and

enforceable against the holder or a transferee of the holder if the restriction is authorized by this

chapter and its existence is noted conspicuously on the front or back of the certificate or is

contained in the initial transaction statement required by Section 6A-8-204(2). Unless noted, a

restriction is not enforceable against a person without knowledge of the restriction.

     (d) A restriction on the transfer, ownership or registration of transfer of shares is

authorized:

     (1) To maintain the corporation’s status when it is dependent on the number or identity of

its shareholders;

     (2) To preserve exemptions under federal or state securities law;

     (3) To permit a corporation to qualify as: (i) a real estate investment trust under the

provisions of the Internal Revenue Code of 1986, as heretofore or hereafter amended, or

regulations adopted thereunder; or (ii) an investment company under the Investment Company

Act of 1940, as heretofore or hereafter amended, or regulations adopted thereunder; and

     (4) For any other reasonable purpose.

     (e) A restriction on the transfer or registration of transfer of shares may:

     (1) Obligate the shareholder first to offer the corporation or other persons (separately,

consecutively, or simultaneously) an opportunity to acquire the restricted shares;

     (2) Obligate the corporation or other persons (separately, consecutively, or

simultaneously) to acquire the restricted shares;

     (3) Require the corporation, the holders of any class of its shares, or another person to

approve the transfer of the restricted shares, if the requirement is not manifestly unreasonable;

     (4) Prohibit the transfer of the restricted shares to designated persons or classes of

persons, if the prohibition is not manifestly unreasonable.

     (f) For the purposes of this section, “shares” includes a security convertible into or

carrying a right to subscribe for or acquire shares.

     7-1.2-610. Fractional shares. - (a) A corporation may: (1) Issue fractions of a share,

     (2) Arrange for the disposition of fractional interests by those entitled to those interests,

     (3) Pay in cash the fair value of fractions of a share as of the time when those entitled to

receive the fractions are determined, or

     (4) Issue scrip in registered or bearer form which entitles the holder to receive a

certificate for a full share upon the surrender of the scrip aggregating a full share.

     (b) A certificate for a fractional share, but not scrip, entitles unless it otherwise provides,

the holder to exercise voting rights, to receive dividends on that share, and to participate in any of

the assets of the corporation in the event of liquidation. The board of directors may issue scrip

subject to the condition that it becomes void if not exchanged for certificates representing full

shares before a specified date, or subject to the condition that the shares for which scrip is

exchangeable may be sold by the corporation and the proceeds from the sale distributed to the

holders of scrip, or subject to any other conditions which the board of directors deems advisable.

     7-1.2-611. Bonds - Facsimile signatures and seals. - The seal of the corporation and any

or all signatures of the officers or other agents of the corporation upon a bond and any coupon

attached to the bond may be facsimiles if the bond is countersigned by an officer or other agent of

a trustee or other certifying or authenticating authority. In case any officer or other agent who has

signed or whose facsimile signature has been placed upon the bond or coupon has ceased to be

the officer or agent before the bond is issued, it may be issued by the corporation with the same

effect as if he were the officer or agent at the date of its issue.

     7-1.2-612. Liability of subscribers and shareholders. - (a) A holder of or subscriber to

shares of a corporation is under no obligation to the corporation or its creditors with respect to the

shares other than the obligation to pay to the corporation the unpaid portion of the consideration

for which the shares were issued or to be issued, which in no event may be less than the amount

of the consideration for which the shares could be lawfully issued.

     (b) Any person becoming an assignee or transferee of shares or of a subscription for

shares in good faith and without knowledge or notice that the full consideration for the shares has

not been paid is not personally liable to the corporation or its creditors for any unpaid portion of

the consideration. An executor, administrator, conservator, guardian, trustee, assignee for the

benefit of creditors, or receiver is not personally liable to the corporation as a holder of or

subscriber to shares of a corporation but the estate and funds in his hands is so liable.

     (c) No pledgee or other holder of shares as collateral security is personally liable as a

shareholder.

     7-1.2-613. Shareholder’s preemptive rights. -- (a) Except to the extent limited or

denied by this section or by the articles of incorporation, shareholders of a corporation

incorporated prior to July 1, 2005 have a preemptive right to acquire unissued shares or securities

convertible into shares or carrying a right to subscribe to or acquire shares. Unless otherwise

provided in the articles of incorporation:

     (1) No preemptive right exists:

     (i) To acquire any shares issued to directors, officers, or employees pursuant to approval

by the affirmative vote of the holders of a majority of the shares entitled to vote on the acquisition

or when authorized by and consistent with a plan previously approved by a vote of shareholders;

or

     (ii) To acquire any shares sold other than for money.

     (2) Holders of shares of any class that is preferred or limited as to dividends or assets are

not entitled to any preemptive right.

     (3) Holders of shares of any class are not entitled to any preemptive right to shares of any

class that is preferred or limited as to dividends or assets or to any obligations, unless convertible

into shares of that class or carrying a right to subscribe to or acquire shares of that class.

     (4) Holders of shares without voting power have no preemptive right to shares with

voting power.

     (5) The preemptive right is only an opportunity to acquire shares or other securities under

terms and conditions that the board of directors may fix for the purpose of providing a fair and

reasonable opportunity for the exercise of the right.

     (b) The shareholders of a corporation incorporated on or after January 1, 2005 do not

have a preemptive right to acquire a corporation’s unissued shares or securities convertible into

shares or carrying a right to subscribe for or acquire shares except to the extent the articles of

incorporation so provide. A statement included in the articles of incorporation that “the

corporation elects to have preemptive rights” (or words of similar import) means that the

following principles apply except to the extent the articles of incorporation expressly provide

otherwise:

     (1) The shareholders of the corporation have a preemptive right, granted on uniform

terms and conditions prescribed by the board of directors, to provide a fair and reasonable

opportunity to exercise the right, to acquire proportional amounts of the corporation’s unissued

shares upon the decision of the board of directors to issue them.

     (2) A shareholder may waive his preemptive right. A waiver evidenced by a writing is

irrevocable even though it is not supported by consideration.

     (3) There is no preemptive right with respect to:

     (i) shares issued as compensation to directors, officers, agents, or employees of the

corporation, its subsidiaries or affiliates;

     (ii) shares issued to satisfy conversion or option rights created to provide compensation to

directors, officers, agents, or employees of the corporation, its subsidiaries or affiliates;

     (iii) shares authorized in articles of incorporation that are issued within six months from

the effective date of incorporation; or

     (iv) shares sold otherwise than for money.

     (4) Holders of shares of any class without general voting rights but with preferential

rights to distributions or assets have no preemptive rights with respect to shares of any class.

     (5) Holders of shares of any class with general voting rights but without preferential

rights to distributions or assets have no preemptive rights with respect to shares of any class with

preferential rights to distributions or assets unless the shares with preferential rights are

convertible into or carry a right to subscribe for or acquire shares without preferential rights.

     (6) Shares subject to preemptive rights that are not acquired by shareholders may be

issued to any person for a period of one year after being offered to shareholders at a consideration

set by the board of directors that is not lower than the consideration set for the exercise of

preemptive rights. An offer at a lower consideration or after the expiration of one year is subject

to the shareholders’ preemptive rights.

     (c) For purposes of this section, “shares” includes a security convertible into or carrying a

right to subscribe for or acquire shares.

     7-1.2-614. Distributions to Shareholders. -- (a) Distributions of other than shares.

     (i) A board of directors may authorize and the corporation may make distributions to its

shareholders subject to restriction the articles of incorporation and the limitation in subsection

(iii).

     (ii) If the board of directors does not fix the record date for determining shareholders

entitled to a distribution (other than one involving a purchase, redemption, or other acquisition of

the corporation’s shares), it is the date the board authorizes the distribution.

     (iii) No distribution may be made if, after giving it effect:

     (1) the corporation would be insolvent; or

     (2) the corporation’s total assets would be less than the sum of its total liabilities plus

(unless the articles of incorporation permit otherwise) the amount that would be needed, if the

corporation to be dissolved at the time of the distribution, to satisfy the preferential rights upon

dissolution of shareholders whose preferential rights are superior to those receiving the

distribution (unless such preferential rights are waived by a majority of the shareholders entitled

to such preferential rights, voting by class).

     (iv) The board of directors may base a determination that a distribution is not prohibited

under subsection (iii) either on financial statements prepared on the basis of accounting practices

and principles that are reasonable in the circumstances or on a fair valuation or other method that

is reasonable in the circumstances.

     (v) Except as provided in subsection (vii), the effect of a distribution under subsection

(iii) is measured:

     (1) in the case of distribution by purchase, redemption, or other acquisition of the

corporation’s shares, as of the earlier of (a) the date money or other property is transferred or debt

incurred by the corporation or (b) the date the shareholder ceases to be a shareholder with respect

to the acquired shares;

     (2) in the case of any other distribution of indebtedness, as of the date the indebtedness is

distributed; and

     (3) in all other cases, as of (a) the date the distribution is authorized if the payment occurs

within one hundred twenty (120) days after the date of authorization or (b) the date the payment

is made if it occurs more than one hundred twenty (120) days after the date of authorization.

     (vi) A corporation’s indebtedness to a shareholder incurred by reason of a distribution

made in accordance with this section is at parity with the corporation’s indebtedness to its

general, unsecured creditors except to the extent subordinated by agreement.

     (vii) Indebtedness of a corporation, including indebtedness issued as a distribution, is not

considered a liability for purposes of determinations under subsection (iii) if its terms of the

indebtedness provide that payment of principal and interest are made only if and to the extent that

payment of a distribution to shareholders could then be made under this section. If the

indebtedness is issued as a distribution, each payment of principal or interest is treated as a

distribution, the effect of which is measured on the date the payment is actually made.

     (b) Distributions of shares.

     (i) Unless the articles of incorporation provide otherwise, shares may be issued pro rata

and without consideration to the corporation’s shareholders or to the shareholders of one or more

classes or series. An issuance of shares under this subsection is a share distribution.

     (ii) Shares of one class or series may not be issued as a share distribution in respect to

shares of another class or series unless (A) the articles of incorporation so authorize, (B) a

majority of the votes entitled to be cast by the class or series to be issued approve the issue, or (C)

there are not outstanding shares of the class or series to be issued.

     (iii) If the board of directors does not fix the record date for determining shareholders

entitled to share distribution, it is the date the board of directors authorizes the share distribution.

     Part VII. Shareholders.

     7-1.2-701. Meetings of shareholders. - (a) Meetings of shareholders may be held at any

place, either within or without this state, that may be stated in or fixed in accordance with the

bylaws. If no other place is stated or fixed, all meetings will be held at the registered office of the

corporation. An annual meeting of shareholders may be held at any time that is stated or fixed in

accordance with the bylaws. Failure to hold the annual meeting at the designated time does not

work a forfeiture or dissolution of the corporation. If the annual meeting is not held within any

thirteen (13) month period the superior court may, in its discretion, on the application of any

shareholder, summarily order a meeting to be held.

     (b) Special meetings of the shareholders may be called by the board of directors, or by a

person or persons that may be authorized by the articles of incorporation or by the bylaws.

     (c) Notice of any meeting of shareholders must be delivered not less than ten (10) nor

more than sixty (60) days before the date of the meeting to each shareholder entitled to vote at the

meeting in the manner prescribed by Section 7-1.2-702.

     (d) Unless the bylaws require otherwise, if an annual or special shareholders’ meeting is

adjourned to a different date, time, or place, notice need not be given of the new date, time, or

place if the new date, time, or place is announced at the meeting before adjournment. If a new

record date for the adjourned meeting is or must be fixed pursuant to the articles of incorporation,

the bylaws or otherwise, however, notice of the adjourned meeting must be given under this

section to persons who are shareholders as of the new record date.

     (e) A shareholder’s attendance at a meeting:

     (i) waives objection to lack of notice or defective notice of the meeting, unless the

shareholder at the beginning of the meeting objects to holding the meeting or transacting business

at the meeting; and

     (ii) waives objection to consideration of a particular matter at the meeting that is not

within the purpose or purposes described in the meeting notice, unless the shareholder objects to

considering the matter when it is presented.

     (f) Upon the application of any shareholder, director, or person aggrieved, the superior

court for the county where the principal office of the corporation is located, shall immediately

hear and determine the petition of the aggrieved with respect to the following: (i) the validity of

any election or appointment of any director or officer of a corporation and the right of any person

to hold the office; (ii) if any office is claimed by more than one individual, the individual entitled

to the office; (iii) the voting and other rights of persons claiming rights in respect of the contested

election or appointment; or (iv) failure of the corporation to hold an annual meeting within any

thirteen month period. The superior court may confirm the election or appointment, order a new

election, or direct any other relief that may be just and proper.

     (g) If authorized by the board of directors in its sole discretion or by the bylaws, and

subject to such guidelines and procedures as the board of directors may adopt or the bylaws may

prescribe, shareholders and proxy holders not physically present at a meeting of shareholders

may, by means of remote communication:

     (i) participate in a meeting of shareholders; and

     (ii) be deemed present in person and vote at a meeting of shareholders whether such

meeting is to be held at a designated place or solely by means of remote communication,

provided that (A) the corporation shall implement reasonable measures to verify that each person

deemed present and permitted to vote at the meeting by means of remote communication is a

shareholder or proxy holder, (B) the corporation shall implement reasonable measures to provide

such shareholders and proxy holders a reasonable opportunity to participate in the meeting and to

vote on matters submitted to the shareholders, including an opportunity to read or hear the

proceedings of the meeting substantially concurrently with such proceedings, and (C) if any

shareholder or proxy holder votes or takes other action at the meeting by means of remote

communication, the corporation shall maintain a record of that vote or other action.

     7-1.2-702. Notice to shareholders. -- (a) Any notice to shareholders given by the

corporation under any provision of this chapter, the articles of incorporation, or the bylaws is

effective if given in writing, or by facsimile or a form of electronic transmission consented to by

the shareholder to whom the notice is given. Any consent to alternative notice is revocable by the

shareholder by written notice to the corporation. Any consent to alternative notice is deemed

revoked if:

     (1) the corporation is unable to deliver by facsimile or electronic transmission two (2)

consecutive notices given by the corporation in accordance with such consent; and

     (2) such inability becomes known to the secretary or an assistant secretary of the

corporation or to the transfer agent, or other person responsible for the giving of notice; provided,

however, the inadvertent failure to treat such inability as a revocation does not invalidate the

action.

     (b) If mailed, the notice is deemed to be delivered when deposited in the United States

mail addressed to the shareholder at his address as it appears on the stock transfer books of the

corporation, with prepaid postage on the mail.

     (c) In the case of any corporation which has fifty (50) or more shareholders of record, if

two (2) successive notices, reports, or other communications addressed to a shareholder of the

corporation at the address of the shareholder appearing on the books of the corporation have been

returned to the corporation by the United States postal service marked to indicate that the United

States postal service is unable to deliver the notices, reports, or other communications to the

shareholder at the address, all future notices, reports, or other communications are deemed to

have been given without further mailing if they are available for the shareholder upon written

demand of the shareholder at the principal executive office of the corporation for a period of one

year from the date of the giving of the notice, report, or other communication to other

shareholders.

     (d) A shareholder may waive any notice required by this section, the articles of

incorporation, or bylaws before or after the date and time stated in the notice. The waiver must

be in writing, be signed by the shareholder entitled to the notice, and be delivered to the

corporation for inclusion in the minutes or filing with the corporate records.

     7-1.2-703. Closing of transfer books and fixing record date. - (a) For the purpose of

determining shareholders entitled to notice of or to vote at any meeting of shareholders or any

adjournment of a meeting of shareholders, or entitled to receive payment of any dividend, or in

order to make a determination of shareholders for any other proper purpose, the board of directors

of a corporation may provide that stock transfer books are closed for a stated period, not less than

that specified in any applicable bylaw and not more than sixty (60) days. In lieu of closing the

stock transfer books, the bylaws, or in the absence of an applicable bylaw, the board of directors

may fix in advance a date as the record date for any determination of shareholders, the date in any

case to be not more than sixty (60) days prior to the date on which the particular action, requiring

the determination of shareholders, is to be taken. If the stock transfer books are not closed and no

record date is fixed for the determination of shareholders entitled to notice of or to vote at a

meeting of shareholders, or shareholders entitled to receive payment of a dividend, the date on

which notice of the meeting is mailed or the date on which the resolution of the board of directors

declaring the dividend is adopted, as the case may be, is the record date for the determination of

shareholders. When a determination of shareholders entitled to vote at any meeting of

shareholders has been made as provided in this section, the determination applies to any

adjournment of the meeting.

     (b) In order that the corporation may determine the shareholders entitled to consent to

corporate action in writing without a meeting, the board of directors may fix a record date, which

record date may not precede the date upon which the resolution fixing the record date is adopted

by the board of directors. If no record date has been fixed by the board of directors, the record

date for determining shareholders entitled to consent to corporate action in writing without a

meeting, when no prior action by the board of directors is required by this chapter, is the first date

on which a signed written consent setting forth the action taken or proposed to be taken is

delivered to the corporation by delivery to its registered office in this state, its principal place of

business, or an officer or agent of the corporation having custody of the book in which

proceedings of meetings of shareholders are recorded. Delivery made to a corporation’s

registered office must be by hand or by certified or registered mail, return receipt requested. If no

record date has been fixed by the board of directors and prior action by the board of directors is

required by this chapter, the record date for determining shareholders entitled to consent to

corporate action in writing without a meeting is the close of business on the day on which the

board of directors adopts the resolution taking such prior action.

     (c) A determination of shareholders entitled to notice of or to vote at a shareholders’

meeting is effective for any adjournment of the meeting unless the board of directors fixes a new

record date.

     7-1.2-704. Voting list. -- (a) After fixing a record date for a meeting, a corporation shall

prepare a list of the names of all its shareholders who are entitled to notice of a shareholders’

meeting.

     (b) The shareholders’ list must be available for inspection by any shareholder, at least ten

(10) days before the meeting is given for which the list was prepared and continuing through the

meeting, at the corporation’s registered office or principal place of business. A shareholder, his

agent, or attorney is entitled on written demand to inspect the list during regular business hours

during the period it is available for inspection.

     (c) The corporation shall make the shareholders’ list available to any shareholder in

attendance, whether in person or by remote communication, and any shareholder, his agent, or

attorney is entitled to inspect the list at any time during the meeting or any adjournment.

     (d) The persons who appear from the list to be shareholders entitled to vote at the meeting

may vote at the meeting.

     (e) If the right to vote at any meeting is challenged, the person presiding at the meeting,

shall rely on the list to determine the right of the challenged person to vote.

     7-1.2-705. Quorum of shareholders required for shareholders’ action. -- (a) Unless

otherwise provided in the articles of incorporation or bylaws, a majority of the shares entitled to

vote, represented in person or by proxy, constitutes a quorum at a meeting of shareholders, but in

no event does a quorum consist of less than one-third (1/3) of the shares entitled to vote at the

meeting. If a quorum is present, unless the vote of a greater number or voting by classes is

required by this chapter or the articles of incorporation or bylaws, in all matters other than the

election of directors, the affirmative vote of the majority of shares present in person or

represented by proxy at the meeting and entitled to vote on the subject matter is the act of the

shareholders.

     (b) Directors are elected by a plurality of the votes of the shares present in person or

represented by proxy at the meeting and entitled to vote on the election of directors. No

amendment to the bylaws made by the board of directors pursuant to Section 7-1.2-203 may

require a greater number or voting by classes.

     7-1.2-706. Greater voting requirements. - Whenever, with respect to any action to be

taken by the shareholders of a corporation, the articles of incorporation require the vote of the

holders of a greater proportion of the shares, or of any class or series of the shares, than required

by this chapter with respect to the action, the provisions of the articles of incorporation control.

An amendment of the articles of incorporation which changes or deletes a provision is authorized

by the same vote as would be required to take action under the provision.

     7-1.2-707. Action by shareholders without a meeting. - (a) Any action required or

permitted to be taken at a meeting of shareholders by this chapter or the articles of incorporation

or bylaws of a corporation, may be taken without a meeting if all the shareholders entitled to vote

on the action consent to the action in writing.

     (b)(1) Except for actions pursuant to Section 7-1.2-1002 or Section 7-1.2-1102, any

action required or permitted to be taken at a meeting of shareholders by this chapter or the

certificate of incorporation or bylaws of a corporation, may be taken without a meeting upon the

written consent of less than all the shareholders entitled to vote on the action, if:

     (i) shareholders who consent would be entitled to cast at least the minimum number of

votes that would be required to take the action at a meeting at which all shareholders entitled to

vote on the action are present and voting in person or by proxy; and

     (ii) Action pursuant to this section is authorized by the articles of incorporation.

     (2) Prompt notice of the action must be given to all shareholders who would have been

entitled to vote upon the action if the meeting were held.

     (c) Whenever action is taken pursuant to this section, the written consents of the

shareholders consenting to the action must be filed with the minutes of proceedings of

shareholders.

     (d) Any action taken pursuant to this section has the same effect for all purposes as if the

action had been taken at a meeting of the shareholders.

     (e) If any other provision of this chapter requires the filing of a certificate upon the taking

of an action by shareholders, and action is taken in the manner authorized by this section, the

certificate must state that the action was taken without a meeting pursuant to the written consents

of the shareholders and must include the number of shares represented by the consents.

     (f) The record date for determining shareholders entitled to express consent in writing

without a meeting, is determined in accordance with Section 7-1.2-703 and if no record date is

fixed for the determination of shareholders entitled to vote by written consent, the date on which

such request for written consent is delivered, in accordance with Section 7-1.2-702, to

shareholders is the record date for the determination of shareholders entitled to express such

written consent.

     7-1.2-708. Voting of shares. - (a) Each outstanding share, regardless of series or class, is

entitled to one vote on each matter submitted to a vote at a meeting of shareholders, except to the

extent that the voting rights of the shares of any class or classes are limited, enlarged, or denied

by the articles of incorporation as permitted by this chapter. If the articles of incorporation

provide for more or less than one vote for any share, on any matter, every reference in this

chapter to a majority or other proportion of shares refers to a majority or other proportion of votes

entitled to be cast.

     (b) Shares held, directly or indirectly, by another corporation if a majority of the shares

entitled to vote for the election of directors of the other corporation is held by the corporation,

may not be voted at any meeting or counted in determining the total number of outstanding shares

at any given time. Nothing contained in these provisions is construed as limiting the right of any

corporation to vote shares, including, but not limited to, its own shares, held in a fiduciary

capacity.

     (c) Every shareholder entitled to vote at a meeting of shareholders or to express consent

without a meeting may authorize another person or persons to act for him by proxy, executed, in

writing, by the shareholder or by his duly authorized attorney in fact. No proxy is valid after

three (3) years from the date of its execution, unless otherwise provided in the proxy.

     (1) Without limiting the manner in which a shareholder may authorize another person or

persons to act for him as proxy pursuant to this subsection (c), the following constitutes a valid

means by which a shareholder may grant that authority:

     (i) A shareholder may execute a writing authorizing another person or persons to act for

him as proxy. Execution may be accomplished by the shareholder or his authorized officer,

director, employee or agent signing the writing or causing his signature to be affixed to the

writing by any reasonable means including, but not limited to, facsimile signature.

     (ii) A shareholder may authorize another person or persons to act for him as proxy by

transmitting or authorizing the transmission of a telegram, cablegram, or other means of

electronic transmission, including Internet and telephonic transmissions, to the person who will

be the holder of the proxy or to a proxy solicitation firm, proxy support service organization or an

agent authorized by the person who will be the holder of the proxy to receive the transmission,

provided that the telegram, cablegram or other means of electronic transmission must either state

or be submitted or communicated with information from which it can be determined that the

telegram, cablegram or other electronic transmission, including Internet and telephonic

transmissions, was authorized by the shareholder. If it is determined that the telegrams,

cablegrams or other electronic transmissions, including Internet and telephonic transmissions, are

valid, the inspectors or, if there are no inspectors, the other persons making that determination,

shall specify the information upon which they relied.

     (2) Any reliable reproduction of the writing or transmission created pursuant to this

section may be substituted or used in lieu of the original writing or transmission for any and all

purposes for which the original writing or transmission could be used, provided that the copy,

facsimile telecommunication or other reproduction is a complete reproduction of the entire

original writing or transmission.

     (3) The death or incapacity of the shareholder appointing a proxy does not affect the right

of the corporation to accept the proxy’s authority unless notice of the death or incapacity is

received by the secretary or other officer or agent authorized to tabulate votes before the proxy

exercises his authority under the appointment.

     (d) The articles of incorporation may provide that at each election of directors, or at

elections held under specified circumstances, every shareholder entitled to vote at the election has

the right to vote, in person or by proxy, the number of shares owned by him for as many persons

as there are directors to be elected and for whose election he has a right to vote, or to cumulate his

votes by giving one candidate as many votes as the number of directors multiplied by the number

of his shares equals, or by distributing the votes on the same principle among any number of the

candidates.

     (e) Shares standing in the name of another corporation, domestic or foreign, may be voted

by any officer, agent, or proxy that the bylaws of the corporation may prescribe, or, in the

absence of a provision, as the board of directors of the corporation may determine.

     (f) Shares held by an administrator, executor, guardian, custodian under a gift to minors

act, conservator or trustee may be voted by him, either in person or by proxy, without a transfer

of the shares into his name.

     (g) Shares held by two (2) or more persons as joint tenants or as tenants in common may

be voted at any meeting of the shareholders by any one of the persons, unless another joint tenant

or tenant in common seeks to vote any of the shares in person or by proxy. In the latter event, the

written agreement, if any, which governs the manner in which the shares are voted, controls if

presented at the meeting. If there is no agreement presented at the meeting, the majority in

number of the joint tenants or tenants in common present control the manner of voting. If there is

no majority, or if there are two (2) joint tenants or tenants in common, both of whom seek to vote

the shares, the shares, for the purpose of voting, must be divided equally among the joint tenants

or tenants in common present.

     (h) Shares standing in the name of a receiver may be voted by the receiver, and shares

held by or under the control of a receiver may be voted by the receiver without the transfer of

those shares into his name if authority to do so is contained in an appropriate order of the court by

which the receiver was appointed.

     (i) A shareholder whose shares are pledged is entitled to vote the shares until the shares

have been transferred into the name of the pledgee, and thereafter the pledgee is entitled to vote

the shares so transferred.

     (j) On and after the date on which written notice of redemption of redeemable shares has

been mailed to the holders of the shares and a sum sufficient to redeem the shares has been

deposited with a bank or trust company with irrevocable instruction and authority to pay the

redemption price to the holders of the shares upon surrender of certificates for the shares, the

shares are not be entitled to vote on any matter and are not be deemed to be outstanding shares.

     (k)(1) An executed proxy is irrevocable if it specifies that it is irrevocable and if, and

only so long as, it is coupled with an interest sufficient in law to support an irrevocable power

coupled with it. A proxy may be made irrevocable regardless of whether the interest with which

it is coupled is an interest in the shares itself or an interest in the corporation generally.

     (2) Without limiting the generality of subsection (k)(1) and subject to that subsection, a

proxy is coupled with an interest and is irrevocable if it is held by any of the following or a

nominee of any of the following:

     (i) A pledgee under a valid pledge;

     (ii) A person who has agreed to purchase the shares under an executory contract of sale;

     (iii) A creditor or creditors of the corporation who extend or continue credit to the

corporation in consideration of the proxy if the proxy states that it was given in consideration of

the extension or continuation of credit, the amount of the credit, and the name of the person

extending or continuing credit; and

     (iv) A person who has contracted to perform services for the corporation if a proxy is

required by the contract of employment, as part of the consideration for the contract of

employment, if the proxy states that it was given in consideration of the contract of employment,

the name of the employee, and the period of employment contracted for; provided the proxies are

respectively be revocable after the pledge is redeemed, or the executory contract of sale is

performed, or the debt of the corporation is paid, or the period of employment has terminated.

     (3) A provision contained in a proxy making it irrevocable is not enforceable against a

purchaser for value of the shares subject to the provision without actual knowledge of the

existence of the provision, unless notice of the proxy and its irrevocability appears plainly on the

certificate or certificates representing the shares; provided that if such shares are uncertificated, a

provision contained in a proxy making it irrevocable is enforceable against a purchaser for value

of the shares subject to the provision without actual knowledge of the existence of the provision if

and only if notice of the proxy and its irrevocability was provided in writing to such purchaser

prior to the consummation of the purchase of such shares.

     7-1.2-709. Voting trusts and agreements among shareholders. -- (a) Any number of

shareholders of a corporation may create a voting trust for the purpose of conferring upon a

trustee or trustees the right to vote or otherwise represent their shares, for a period not to exceed

ten (10) years, by entering into a written voting trust agreement specifying the terms and

conditions of the voting trust, by depositing a counterpart of the agreement with the corporation at

its registered office, and by transferring their shares to the trustee or trustees for the purposes of

the agreement. The trustee or trustees shall keep a record of the holders of voting trust

certificates evidencing a beneficial interest in the voting trust, giving the names and addresses of

all the holders and the number and class of the shares in respect of which the voting trust

certificates held by each are issued, and shall deposit a copy of the record with the corporation at

its registered office. The counterpart of the voting trust agreement and the copy of the record

deposited with the corporation are subject to the same right of examination by a shareholder of

the corporation, in person or by agent or attorney, as are the books and records of the corporation,

and the counterpart and the copy of the record is subject to examination by any holder of record

of voting trust certificates, either in person or by agent or attorney, at any reasonable time for any

proper purpose. The trust certificates must state that they are issued pursuant to the voting trust

agreement, and that fact must be stated in the stock ledger of the corporation.

     (b) Agreements among shareholders regarding the voting of their shares are valid and

enforceable in accordance with their terms for a period of not to exceed ten (10) years. An

agreement is not subject to the provision of this section regarding voting trusts unless it is stated

in the agreement that it is a voting trust.

     (c) The provisions of this section are construed as permissive and should not be

interpreted to invalidate any voting or other agreement among shareholders, or any irrevocable

proxy which is otherwise not illegal.

     (d) A voting trust or shareholders agreement may at any time or times be extended for an

additional period not in excess of ten (10) years, but the extension is binding only with respect to

those shares owned of record or beneficially by parties to the extension.

     7-1.2-710. Voting and inspection rights of bondholders and debenture holders. - The

articles of incorporation may, to the extent and in the manner provided in the articles, confer on

the holders of bonds or other evidences of indebtedness of the corporation rights to vote in the

election of directors and on any other matters on which shareholders may vote and rights to

inspect the books and records of the corporation.

     7-1.2-711. Actions by shareholders. – (a) Subchapter Definitions. In this subchapter:

     (1) “Derivative proceeding” means a civil suit in the right of a domestic corporation or, to

the extent provided in subsection (h) of this Section 7-1.2-711, in the right of a foreign

corporation.

     (2) “Shareholder” includes a beneficial owner whose shares are held in a voting trust or

held by a nominee on the beneficial owner’s behalf.

     (b) Standing. A shareholder may not commence or maintain a derivative proceeding

unless the shareholder: (i) was a shareholder of the corporation at the time of the act or omission

complained of or became a shareholder through transfer by operation of law from one who was a

shareholder at that time; and (ii) fairly and adequately represents the interests of the corporation

in enforcing the right of the corporation.

     (c) Demand. No shareholder may commence a derivative proceeding until:

     (1) a written demand had been made upon the corporation to take suitable action; and

     (2) 90 days have expired from the date the demand was made unless the shareholder has

earlier been notified that the demand has been rejected by the corporation or unless irreparable

injury to the corporation would result by waiting for the expiration of the 90 day period.

     (d) Stay of proceedings. If the corporation commences an inquiry into the allegations

made in the demand or complaint, the court may stay any derivative proceeding for such period

as the court deems appropriate.

     (e) Dismissal.

     (1) On motion by the corporation, the court shall dismiss a derivative proceeding if one

of the groups specified in subsections (ii) or (vi) has determined in good faith after conducting a

reasonable inquiry upon which its conclusions are based that the maintenance of the derivate

proceedings is not in the best interests of the corporation.

     (2) Unless a panel is appointed pursuant to subsection (vi), the determination in

subsection (i) must be made by:

      (i) a majority vote of independent directors present at a meeting of the board of directors

if the independent directors constitute a quorum; or

     (ii) a majority vote of a committee consisting of two or more independent directors

appointed by majority vote of independent directors present at a meeting of the board of directors,

whether or not such independent directors constituted a quorum.

     (3) None of the following by itself causes a director to be considered not independent for

purposes of this section:

     (i) the nomination or election of the directors or persons who are defendants in the

derivative proceedings or against whom action is demanded;

     (ii) the naming of the director as a defendant in the derivative proceeding or as a person

against whom action is demanded; or

     (iii) the approval by the director of the act being challenged in the derivative proceeding

or demand if the act resulted in no personal benefit to the director.

     (4) If a derivative proceeding is commenced after a determination has been made

rejecting a demand by a shareholder, the complaint must allege with particularity facts

establishing either (A) that a majority of the board of directors did not consist of independent

directors at the time the determination was made or (B) that the requirements of subsection (a)

have not been met.

     (5) If a majority of the board of directors does not consist of independent directors at the

time the determination is made, the corporation has the burden of proving that the requirements of

subsection (i) have been met. If a majority of the board of directors consists of independent

directors at the time the determination is made, the plaintiff has the burden of proving that the

requirements of subsection (i) have not been met.

     (6) The court may appoint a panel of one or more independent persons upon motion by

the corporation to make a determination whether the maintenance of the derivative proceeding is

in the best interests of the corporation. In such case, the plaintiff has the burden of proving that

the requirements of subsection (i) have not been met.

     (f) Discontinuance or settlement. A derivative proceeding may not be discontinued or

settled without the court’s approval. If the court determines that a proposed discontinuance or

settlement will substantially affect the interests of the corporation’s shareholders or a class of

shareholders, the court shall direct that notice be given to the shareholders affected.

     (g) Payment of expenses. On termination of the derivative proceeding the court may:

     (1) order the corporation to pay the plaintiff’s reasonable expenses (including counsel

fees) incurred in the proceeding if it finds that the proceeding has resulted in a substantial benefit

to the corporation;

     (2) order the plaintiff to pay any defendant’s reasonable expenses (including counsel

fees) incurred in defending the proceeding if it finds that the proceeding was commenced or

maintained without reasonable cause or for an improper purpose; or

     (3) order a party to pay an opposing party’s reasonable expenses (including counsel fees)

incurred because of the filing of a pleading, motion or other paper, if it finds that the pleading,

motion or other paper was not well grounded in fact, after reasonable inquiry, or warranted by

existing law or a good faith argument for the extension, modification or reversal of existing law

and was interposed for an improper purpose, such as to harass or cause unnecessary delay or

needless increase in the cost of litigation.

     (h) Applicability to foreign corporations. In any derivative proceeding in the right of a

foreign corporation, the matters covered by this subchapter are governed by the laws of the

jurisdiction of incorporation of the foreign corporation except for subsections (d), (f), and (g) of

this Section 7-1.2-711.

     Part VIII. Directors and Officers.

     7-1.2-801. Board of directors. - (a) Except as may be otherwise provided in this chapter

or in the articles of incorporation, the business and affairs of a corporation are managed by a

board of directors. Directors need not be residents of this state or shareholders of the corporation

unless the articles of incorporation or bylaws require it. The articles of incorporation or bylaws

may prescribe other qualifications for directors. The board of directors has authority to fix the

compensation of directors unless otherwise provided in the articles of incorporation.

     (b) A director shall discharge his duties as a director, including his duties as a member of

a committee:

     (1) In good faith;

     (2) With the care that a person in a like position would reasonably believe appropriate

under similar circumstances; and

     (3) In a manner he reasonably believes to be in the best interests of the corporation.

     (c) In discharging his duties, a director is entitled to rely on information, opinions,

reports, or statements, including financial statements and other financial data, if prepared or

presented by:

     (1) One or more officers or employees of the corporation whom the director reasonably

believes to be reliable and competent in the matters presented;

     (2) Legal counsel, public accountants, or other persons as to matters the director

reasonably believes are within the person’s professional or expert competence; or

     (3) A committee of the board of directors of which he is not a member if the director

reasonably believes the committee merits confidence.

     (d) A director is not acting in good faith if he has knowledge concerning the matter in

question that makes reliance otherwise permitted by subsection (c) unwarranted.

     (e) A director is not liable for any action taken as a director, or any failure to take any

action, if he performed the duties of his office in compliance with this section.

     (f) For the purposes of subsections (b) through (e), “corporation” also includes any

financial institution, insurance company, public utility or other quasi-public corporation having

purposes enumerated as exceptions to this chapter in Section 7-1.2-301 and the provisions of

subsections (b) through (e) of this section are applicable to the directors of that corporation.

     7-1.2-802. Number and election of directors. - The board of directors of a corporation

consists of one or more members. The number of directors is fixed by, or in the manner provided

in, the articles of incorporation or the bylaws except as to the number constituting the initial

board of directors, which number is fixed by the articles of incorporation. The number of

directors may be increased or decreased from time to time by amendment to, or in the manner

provided in, the articles of incorporation or the bylaws, but no decrease has the effect of

shortening the term of any incumbent director. If the articles of incorporation provide for the

election of directors in the manner specified in subsection (d) of Section 7-1.2-708, the number of

directors may not be decreased unless approved by the shareholders with less than the number of

shares previously entitled to elect one director voting against the decrease. In the absence of a

bylaw fixing the number of directors, the number is the same as that provided for in the articles of

incorporation. The names and addresses of the members of the first board of directors must be

stated in the articles of incorporation. Those persons hold office until the first annual meeting of

shareholders, and until their successors have been elected and qualified. At the first annual

meeting of shareholders and at each subsequent annual meeting, the shareholders shall elect

directors to hold office until the next succeeding annual meeting, except in the case of the

classification of directors as permitted by this chapter. Each director holds office for the term for

which he is elected and until his successor has been elected and qualified. Any director may

resign at any time upon notice given in writing to the corporation.

     7-1.2-803. Classification of directors. - When the board of directors consists of nine (9)

or more members, in lieu of electing the whole number of directors annually, the articles of

incorporation may provide that the directors be divided into either two (2) or three (3) classes,

each class to be as nearly equal in number as possible, the term of office of directors of the first

class to expire at the first annual meeting of shareholders after their election, that of the second

class to expire at the second annual meeting after their election, and that of the third class, if any,

to expire at the third annual meeting after their election. At each annual meeting after the

classification, the number of directors equal to the number of the class whose term expires at the

time of the meeting will be elected to hold office until the second succeeding annual meeting, if

there are two (2) classes, or until the third succeeding annual meeting, if there are three (3)

classes. No classification of directors is effective prior to the first annual meeting of

shareholders. The articles of incorporation may confer upon holders of any class or series of

shares the right to elect one or more directors who serve for any term and have any voting powers

stated in the articles of incorporation. The terms of office and voting powers of the directors

elected in the manner provided in the articles of incorporation may be greater than or less than

those of any other director or class of directors.

     7-1.2-804. Vacancies. - Any vacancy occurring in the board of directors may be filled by

the affirmative vote of a majority of the remaining directors though less than a quorum of the

board of directors. A director elected to fill a vacancy is elected for the unexpired term of his

predecessor in office. Any directorship to be filled by reason of an increase in the number of

directors may be filled by the board of directors for a term of office continuing only until the next

election of directors by the shareholders. If at any time, by reason of death, resignation or other

cause, a corporation should have no directors in office, then any officer or any shareholder or an

executor, administrator, trustee or guardian of a shareholder, or other fiduciary entrusted with like

responsibility for the person or estate of a shareholder, may call a special meeting of shareholders

in accordance with the provisions of the articles of incorporation or the bylaws, or may apply to

the superior court for a decree summarily ordering a meeting for the purposes of conducting an

election.

     7-1.2-805. Removal of directors. - (a) Any or all of the directors may be removed for

cause by vote of the shareholders. The articles of incorporation or the specific provisions of a

bylaw adopted by the shareholders may provide for the removal by action of the board, except in

the case of any director elected by cumulative voting, or by the holders of the shares of any class

or series, or holders of bonds, voting as a class, when entitled by the provisions of the articles of

incorporation.

     (b) Unless the articles of incorporation provide that directors may be removed only for

cause, any or all of the directors may be removed without cause by vote of the shareholders.

     (c) The removal of directors, with or without cause, as provided in subsections (a) and (b)

is subject to the following:

     (1) In the case of a corporation having cumulative voting, no director may be removed

when the votes cast against his removal would be sufficient to elect him if voted cumulatively at

an election at which the same total number of votes were cast and the entire board, or the entire

class of directors of which he is a member, were then being elected; and

     (2) When by the provisions of the articles of incorporation the holders of the shares of

any class or series, or holders of bonds, voting as a class, are entitled to elect one or more

directors, any director so elected may be removed only by the applicable vote of the holders of

the shares of that class or series or the holders of the bonds, voting as a class.

     (d) An action to procure a judgment removing a director for cause may be brought by the

attorney general or by the holders of ten percent (10%) of the outstanding shares, whether or not

entitled to vote. The court having jurisdiction may bar from reelection any directors so removed

for a period fixed by the court.

     7-1.2-806. Quorum of directors. - A majority of the number of directors fixed by or in

the manner provided in the articles of incorporation or the bylaws, or by the shareholders or in the

absence of a bylaw or shareholder action fixing the number of directors, then of the number stated

in the articles of incorporation, constitutes a quorum for the transaction of business unless a

greater number is required by the articles of incorporation or the bylaws. The act of the majority

of the directors present at a meeting at which a quorum is present is the act of the board of

directors, unless the act of a greater number is required by the articles of incorporation or the

bylaws.

     7-1.2-807. Director and officer conflicts of interest. - (a) No contract or transaction

between a corporation and one or more of its directors or officers, or between a corporation and

any other corporation, partnership, association, or other organization in which one or more of its

directors or officers are directors or officers or have a financial interest, is void or voidable nor

are the directors or officers liable with respect to the contract or transaction solely for this reason,

or solely because the director or officer is present at or participates in the meeting of the board or

committee of the board which authorizes the contract or transaction, or solely because his or their

votes are counted for that purpose, if:

     (1) The material facts as to his or their interest or relationship are disclosed or are known

to the board of directors or the committee, and the board of directors or committee authorizes,

approves, or ratifies the contract or transaction by the affirmative votes of a majority of the

disinterested directors, even though the disinterested directors are less than a quorum; or

     (2) The material facts as to his or their interest or relationship are disclosed or are known

to the shareholders entitled to vote on the contract or transaction, and the contract or transaction is

specifically authorized, approved, or ratified by vote of the shareholders; or

     (3) The contract or transaction is fair and reasonable as to the corporation.

     (b) Common or interested directors may be counted in determining the presence of a

quorum at a meeting of the board of directors or of a committee which authorizes the contract or

transaction.

     7-1.2-808. Executive and other committees. - Unless otherwise restricted or limited by

the articles of incorporation or the bylaws, the board of directors, by resolution adopted by a

majority of the full board of directors, may designate from among its members an executive

committee and one or more other committees each of which, to the extent provided in the

resolution or in the articles of incorporation or the bylaws of the corporation, have and may

exercise all the authority of the board of directors, but no committee has the authority of the board

of directors in reference to amending the articles of incorporation, adopting a plan of merger,

recommending to the shareholders the sale, lease, exchange, or other disposition of all or

substantially all the property and assets of the corporation other than in the usual and regular

course of its business, recommending to the shareholders a voluntary dissolution or revocation of

the corporation, or amending the bylaws of the corporation. The designation of any committee

and the delegation to the committee of authority does not operate to relieve the board of directors,

or any member of the board, of any responsibility imposed by law.

     7-1.2-809. Place, notice, and form of notice of directors’ and committee meetings. -

(a) Meetings of the board of directors, or any committee designated by the board, regular or

special, may be held either within or without this state.

     (b) Regular meetings of the board of directors or any committee designated by the board

may be held with or without notice as prescribed in the bylaws. Unless the articles of

incorporation or the bylaws provide for an alternative period, special meetings of the board of

directors or any committee designated by the board must be preceded by at least two (2) days’

notice of the date, time, and place of the meeting. Attendance of a director at a meeting

constitutes a waiver of notice of the meeting, except where a director attends a meeting for the

express purpose of objecting to the transaction of any business because the meeting is not

lawfully called or convened. Neither the business to be transacted at, nor the purpose of, any

regular or special meeting of the board of directors or any committee designated by the board of

directors need be specified in the notice or waiver of notice of the meeting unless required by the

bylaws. Except as may be otherwise restricted by the articles of incorporation or bylaws,

members of the board of directors or any committee designated by the board of directors may

participate in a meeting of the board or committee by means of a conference telephone or similar

communications equipment, by means of which all persons participating in the meeting can hear

each other at the same time and participation by those means constitutes presence in person at a

meeting.

     7-1.2-810. Action by directors without a meeting. - Unless otherwise provided by the

articles of incorporation or bylaws, any action required by this chapter to be taken at a meeting of

the directors of a corporation, or any action which may be taken at a meeting of the directors or of

a committee, may be taken without a meeting if all of the directors, or all of the members of the

committee, as the case may be, consent thereto in writing or by electronic transmission, before or

after the action, and the writing or writings or electronic transmission or transmissions are filed

with the minutes of proceedings of the board or committee. The consent has the same effect as a

unanimous vote for all purposes, and that may be stated in any certificate or other document filed

with the secretary of state.

     7-1.2-811. Liability of directors in certain cases. - (a) In addition to any other liabilities

imposed by law upon directors of a corporation:

     (1) Directors of a corporation who vote for or assent to the declaration of any dividend or

other distribution of the assets of a corporation to its shareholders contrary to the provisions of

this chapter or contrary to any restrictions contained in the articles of incorporation, are jointly

and severally liable to the corporation for the amount of the dividend which is paid or the value of

the assets which are distributed in excess of the amount of the dividend or distribution which

could have been paid or distributed without a violation of the provisions of this chapter or the

restrictions in the articles of incorporation.

     (2) Directors of a corporation who vote for or assent to the purchase of its own shares

contrary to the provisions of this chapter are jointly and severally liable to the corporation for the

amount of consideration paid for the shares which is in excess of the maximum amount which

could have been paid for the shares without a violation of the provisions of this chapter.

     (3) Directors of a corporation who vote for or assent to any distribution of assets of a

corporation to its shareholders during the liquidation of the corporation without the payment and

discharge of, or making adequate provision for, all known debts, obligations, and liabilities of the

corporation are jointly and severally liable to the corporation for the value of the assets which are

distributed, to the extent that the debts, obligations, and liabilities of the corporation are not

subsequently paid and discharged.

     (b) A director who is present at a meeting of its board of directors at which action on any

corporate matter is taken is presumed to have assented to the action taken unless his dissent is

entered in the minutes of the meeting or unless he files his written dissent to the action with the

person acting as the secretary of the meeting before the meeting’s adjournment or forwards the

dissent by registered mail to the secretary of the corporation immediately after the adjournment of

the meeting. The right to dissent does not apply to a director who voted in favor of the action.

     (c) A director is not liable under this section if under the circumstances he acted with due

care and in good faith, and without limiting the generality of what has just been stated, is not

liable if he relied in good faith upon financial statements of the corporation represented to him to

be correct and to be based upon generally accepted accounting principles by the president or the

officer of the corporation having charge of its books of account, or stated in a written report by an

independent public or certified public accountant or firm of accountants fairly to reflect the

financial condition of the corporation.

     (d) Any director against whom a claim is asserted under or pursuant to this section for the

payment of a dividend or other distribution of assets of a corporation and who is held liable on the

claim, is entitled to contribution from the shareholders who accepted or received any dividend or

assets, knowing the dividend or distribution to have been made in violation of this chapter, in

proportion to the amounts received by them respectively.

     7-1.2-812. Officers. -- (a) The officers of a corporation consist of a president, a secretary,

and a treasurer, and such other officers as are authorized by the bylaws or the board of directors

each of whom is elected by the board of directors or by the shareholders at a time and in a manner

as prescribed by the bylaws. Any other officers and assistant officers and agents as that are

necessary may be elected or appointed by the board of directors or by the shareholders or chosen

in another manner prescribed by the bylaws. Any two (2) or more offices may be held by the

same person. A failure to elect officers does not dissolve or otherwise affect the corporation.

     (b) All officers of the corporation, as between themselves and the corporation, have the

authority and perform any duties in the management of the corporation that may be provided in

the bylaws, or that may be determined by resolution of the board of directors, subject to any

limitations on the authority contained in the bylaws.

     7-1.2-813. Resignation and removal of officers. - An officer may resign at any time by

delivering notice to the corporation. Any officer may be removed at any time with or without

cause by the board of directors or by any other manner permitted by the articles of incorporation

or the bylaws. Election, appointment or removal of an officer or agent does not of itself create

contract rights.

      7-1.2-814. Indemnification. - (a) Definitions. As used in this section:

     (1) “Director” or “officer” means any individual who is or was a director of the

corporation and any individual who, while a director or officer of the corporation, is or was

serving at the request of the corporation as a director, officer, partner, trustee, employee, or agent

of another foreign or domestic corporation, limited liability company, partnership, joint venture,

trust, other enterprise, employee benefit plan, or other entity. A director or officer is considered

to be serving an employee benefit plan at the corporation’s request if his duties to the corporation

also impose duties on, or otherwise involve services by, him to the plan or participants on or

beneficiaries of the plan. “Director” or “officer” includes, unless the context requires otherwise,

the estate or personal representative of the director or officer.

     (2) “Corporation” includes:

     (i) any domestic or foreign corporation, profit or nonprofit;

     (ii) any domestic or foreign predecessor entity of the corporation in a merger or other

transaction in which the predecessor’s existence ceased upon consummation of the transaction;

and

     (iii) any of the classes of quasi public corporations with purposes enumerated as

exceptions in Section 7-1.2-301 to the extent that the corporations are not subject to other

provisions of the general laws or special acts authorizing indemnification of their directors and

officers.

     (3) “Expenses” include attorneys’ fees.

     (4) “Liability” means the obligation to pay a judgment, penalties, fines (including an

excise tax assessed with respect to an employee benefit plan), settlements, or reasonable expenses

actually incurred by the person in connection with the proceeding.

     (5) “Official capacity” means:

     (i) When used with respect to a director, the office of director in the corporation; and

     (ii) When used with respect to an officer, as contemplated in subsection (i), the office in a

corporation held by the officer. “Official capacity” does not include service for a individual other

than a director, as contemplated in subsection (a)(1), the elective or appointive office in the

corporation held by the officer or the employment or agency relationship undertaken by the

employee or agent on behalf of the corporation, but in each case does not include service for any

other foreign or domestic corporation or any partnership, joint venture, trust, other enterprise, or

employee benefit plan.

     (6) “Party” includes a individual who was, is, or is threatened to be made, a named

defendant or respondent in a proceeding.

     (7) “Proceeding” means any threatened, pending or completed action, suit, or proceeding,

whether civil, criminal, administrative, or investigative.

     (b) Permissible indemnification.

     (1) Except as otherwise provided in this section, a corporation has power to indemnify

any individual made a party to any proceeding by reason of the fact that he is or was a director if:

     (i) He conducted himself in good faith; and

     (ii) He reasonably believed,

     (A) In the case of conduct in his official capacity with the corporation, that his conduct

was in its best interests, and

     (B) In all other cases, that his conduct was at least not opposed to its best interests; and

     (iii) In the case of any criminal proceeding, he had no reasonable cause to believe his

conduct was unlawful; or

     (iv) He engaged in conduct for which broader indemnification has been made permissible

or obligatory under a provision of the articles of incorporation.

     (2) A director’s conduct with respect to an employee benefit plan for a purpose he

reasonably believed to be in the interests of the participants and beneficiaries of the plan is

deemed to be for a purpose which is not opposed to the best interests of the corporation in

accordance with (b)(1)(ii)(B).

     (3) The termination of any proceeding by judgment, order, settlement, conviction, or

upon a plea of nolo contendere or its equivalent, is not, of itself, be determinative that the

individual did not meet the requisite standard of conduct set forth in this subsection.

     (4) Unless ordered by a court under subsection (d), a corporation may not indemnify a

director:

     (i) in connection with a proceeding by or in the right of the corporation, except for

reasonable expenses incurred in connection with the proceeding (if it is determined that the

director has met the relevant standard of conduct under (b)(1)(i) and (ii)), or

     (ii) in connection with any proceeding for which the director was adjudged liable to the

corporation on the basis that he received an improper personal benefit, whether or not involving

action in his official capacity.

     (c) Mandatory Indemnification. Unless limited by the articles of incorporation, a director

who has been wholly successful, on the merits or otherwise, in the defense of any proceeding

referred to in subsection (b) is indemnified against reasonable expenses incurred by him in

connection with the proceeding; and

     (d) Court-ordered indemnification.

     (1) A court of appropriate jurisdiction, upon application of a director and any notice that

the court requires, has authority to order indemnification in the following circumstances:

     (i) If the court determines a director is entitled to reimbursement under subsection (d), the

court shall order indemnification, in which case the director is also entitled to recover the

expenses of securing the reimbursement; or

     (ii) If the court determines that the director is fairly and reasonably entitled to

indemnification in view of all the relevant circumstances, whether or not he has met the standard

of conduct set forth in subsection (b)(1) or (b)(2) or has been adjudged liable in the circumstances

described in subsection (b)(4)(ii), the court may order such indemnification as the court shall

deem proper, except that indemnification with respect to any proceeding by or in the right of the

corporation or in which liability has been adjudged in the circumstances described in subsection

(b)(4)(i) are limited to expenses.

     (2) A court of appropriate jurisdiction may be the same court in which the proceeding

involving the director’s liability took place.

     (e) Advance for expenses. Reasonable expenses incurred by a director who is a party to a

proceeding may be paid or reimbursed by the corporation in advance of the final disposition of

the proceeding upon receipt by the corporation of:

     (1) A written affirmation by the director of his good faith belief that he has met the

standard of conduct necessary for indemnification by the corporation as authorized in this section,

and

     (2) A written undertaking by or on behalf of the director to repay the amount if the court

determines that he has not met that standard of conduct, and after a determination that the facts

then known to those making the determination would not preclude indemnification under this

section. The undertaking required by this subdivision must be an unlimited general obligation of

the director but need not be secured and may be accepted without reference to financial ability to

make repayment. Determinations and authorizations of payments under this subsection are made

in the manner specified in subsection (f).

     (f) Determination and authorization of indemnification.

     (1) No indemnification under subsection (b) may be made by the corporation unless

authorized in the specific case after a determination has been made that indemnification of the

director is permissible in the circumstances because he has met the standard of conduct set forth

in subsection (b). The determination must be made:

     (i) By the board of directors by a majority vote of a quorum consisting of directors not at

the time parties to the proceeding; or

     (ii) If such a quorum cannot be obtained, then by a majority vote of a committee of the

board, duly designated to act in the matter by a majority vote of the full board (in which

designation directors who are parties may participate), consisting solely of two (2) or more

directors not at the time parties to the proceeding; or

     (iii) By special legal counsel, selected by the board of directors or a committee of the

board by vote as set forth in subsection(f)(1)(i) or (f)(1)(ii), or, if the requisite quorum of the full

board cannot be obtained for the vote and the committee cannot be established, by a majority vote

of the full board (in which selection directors who are parties may participate); or

     (iv) By the shareholders.

     (2) Authorization of indemnification and determination as to reasonableness of expenses

are made in the same manner as the determination that indemnification is permissible, except that

if the determination that indemnification is permissible is made by special legal counsel,

authorization of indemnification and determination as to reasonableness of expenses must be

made in a manner specified in subsection (f)(1)(iii) for the selection of the counsel. Shares held

by directors who are parties to the proceeding may not be voted on the subject matter under this

subsection.

     (g) Variation by Corporate Action. The indemnification provided by this section is not

deemed exclusive of any other rights to which those seeking indemnification are entitled under

any bylaw, agreement, vote of shareholders or disinterested directors or otherwise, both as to

action in his official capacity and as to action in another capacity while holding office, and

continues as to a individual who has ceased to be a director, officer, partner, trustee, employee, or

agent and inures to the benefit of the heirs, executors, and administrators of [a person][an

individual]. Nothing contained in this section limits the corporation’s power to pay or reimburse

expenses incurred by a director in connection with his appearance as a witness in a proceeding at

a time when he has not been made a named defendant or respondent in the proceeding.

     (h) Officers. Unless limited by the articles of incorporation:

     (1) An officer of the corporation is indemnified under this section as and to the same

extent provided for a director, and is entitled to the same extent as a director to seek

indemnification pursuant to the provisions of this section;

     (2) A corporation has the power to indemnify and to advance expenses to an officer,

employee, or agent of the corporation to the same extent that it may indemnify and advance

expenses to directors pursuant to this section; and

     (3) A corporation, in addition, has the power to indemnify and to advance expenses to an

officer, employee, or agent who is not a director to a further extent, consistent with law, that is

provided by its articles of incorporation, bylaws, general or specific action of its board of

directors, or contract.

     (i) Insurance. A corporation has power to purchase and maintain insurance on behalf of

any individual who is or was a director, officer, employee, or agent of the corporation, or who,

while a director, officer, employee, or agent of the corporation, is or was serving at the request of

the corporation as a director, officer, partner, trustee, employee, or agent of another foreign or

domestic corporation, partnership, joint venture, trust, other enterprise, or employee benefit plan,

against any liability asserted against him and incurred by him in any corporate capacity or arising

out of his status as a director, officer, employee, or agent of the corporation, whether or not the

corporation would have the power to indemnify him against the liability under the provisions of

this section.

     (j) Shareholder approval. Any indemnification of, or advance of expenses to, a director

in accordance with this section, if arising out of a proceeding by or in the right of the corporation,

must be reported in writing to the shareholders with or before the notice of the next shareholders’

meeting.

     Part IX. Amendment of Articles of Incorporation.

     7-1.2-901. Right to amend articles of incorporation. - (a) A corporation may amend its

articles of incorporation, from time to time, in any and all respects as is desired, to the extent that

its articles of incorporation, as amended, contain only provisions that might be lawfully contained

in original articles of incorporation filed as of the time of the filing of the amendment, and, if a

change in shares or the rights of shareholders, or an exchange, reclassification, subdivision,

combination or cancellation of shares or rights of shareholders is to be made, the provisions that

may be necessary to effect the change, exchange, reclassification, subdivision, combination or

cancellation.

     7-1.2-902. Right to amend legislative charters. -- Any corporation created by special

act of the general assembly which is organized under this chapter, whose charter is subject to

amendment or repeal at the will of the general assembly may make amendment to its charter that

corporations organized under this chapter may make to their articles of incorporation under

Section 7-1.2-901. The proposed amendment is effected and evidenced in the same manner, by

the same vote and upon the same terms and conditions as are prescribed in Sections 7-1.2-903

and 7-1.2-904.

     7-1.2-903. Procedure to amend articles of incorporation. - (a) Amendments to the

articles of incorporation are made in the following manner: (1) The board of directors adopts a

resolution setting forth the proposed amendment and directing that it be submitted to a vote at a

meeting of shareholders, which may be either the annual or a special meeting. If no shares have

been issued, the amendment is adopted by resolution of the board of directors and the provisions

subsequently stated for adoption by shareholders do not apply. The resolution may incorporate

the proposed amendment in restated articles of incorporation which contain a statement that,

except for the designated amendment, the restated articles of incorporation correctly state without

change the corresponding provisions of the articles of incorporation as previously amended, and

that the restated articles of incorporation, together with the designated amendment, supersede the

original articles of incorporation and all amendments to those articles.

     (2) Written notice stating the proposed amendment or a summary of the changes to be

affected by the amendment must be given to each shareholder entitled to vote on the amendment

within the time and in the manner provided in this chapter for the giving of notice of meetings of

shareholders. If the meeting is an annual meeting, the proposed amendment or the summary may

be included in the notice of the annual meeting.

     (3) At the meeting a vote of the shareholders entitled to vote on the amendment must be

taken on the proposed amendment. The proposed amendment is adopted upon receiving the

affirmative vote of the holders of a majority of the shares entitled to vote on the amendment

unless any class of shares is entitled to vote on the amendment as a class, pursuant to either the

articles of incorporation or the provisions of Section 7-1.2-904, in which event approval of the

proposed amendment also requires the affirmative vote of the holders of a majority of the shares

of each class of shares entitled to vote as a class on the amendment.

     (b) Any number of amendments may be submitted to the shareholders, and voted upon by

them, at one meeting.

     (c) The resolution authorizing a proposed amendment to the articles of incorporation may

provide that at any time prior to the filing of the amendment with the secretary of state,

notwithstanding authorization of the proposed amendment by the shareholders of the corporation,

the board of directors may abandon the proposed amendment without further action by the

shareholders.

     (d) Whenever the articles of incorporation require for action by the board of directors, by

the holders of any class or series of shares or by the holders of any other securities having voting

power the vote of a greater number or proportion than is required by any section of this title, the

provision of the articles of incorporation requiring such greater vote may not be altered, amended

or repealed except by such greater vote.

     7-1.2-904. Class voting on amendments. -- (a) Except as otherwise provided in this

section, the holders of the outstanding shares of a class are entitled to vote as a class upon a

proposed amendment, whether or not entitled to vote on the amendment by the provisions of the

articles of incorporation, if the amendment would:

     (1) Increase or decrease the aggregate number of authorized shares of the class.

     (2) Increase or decrease the par value of the shares of the class.

     (3) Effect an exchange, reclassification, or cancellation of all or part of the shares of the

class.

     (4) Effect an exchange, or create a right of exchange, of all or any part of the shares of

another class into the shares of the class.

     (5) Change the designations, preferences, limitations, or relative rights of the shares of

the class.

     (6) Change the shares of the class, whether with or without par value, into the same or a

different number of shares, either with or without par value, of the same class or another class or

classes.

     (7) Create a new class of shares having rights and preferences prior and superior to the

shares of the class, or increase the rights and preferences or the number of authorized shares of

any class having rights and preferences prior or superior to the shares of the class.

     (8) In the case of a preferred or special class of shares, divide the shares of the class into

series and fix and determine the designation of the series and the variations in the relative rights

and preferences between the shares of the series, or authorize the board of directors to do so.

     (9) Limit or deny any existing preemptive rights of the shares of the class.

     (10) Cancel or otherwise affect dividends on the shares of the class which have accrued

but have not been declared.

     (b) If the proposed amendment would affect only the shares of one series of a class and

not the entire class, then only the shares of the series so affected is considered a separate class for

the purpose of this section. Any class and any series within a class is considered a separate class

for purposes of this section if the effect of the proposed amendment upon the class or series

would be different than the effect of the amendment upon the other classes or other series within

the class. If the proposed amendment would affect two (2) or more classes or series within a

class in the same way but would not affect the remaining classes or series within the class in the

same way, the two (2) or more classes or series affected in the same way are together considered

a separate class for purposes of this section. Except as otherwise provided in the articles of

incorporation or the certificate referred to in Section 7-1.2-602, if the proposed amendment would

have no effect upon one or more classes or series of a class, the classes or series are not entitled to

any vote on the proposed amendment and, for the purposes of this section, are not counted in

determining the number of shares constituting the class.

     7-1.2-905. Articles of amendment. -- (a) The corporation may amend its articles of

incorporation by filing with the secretary of state articles of amendment which must state:

     (1) The name of the corporation.

     (2) The amendment so adopted.

     (3) The date of the adoption of the amendment by the shareholders or by the board of

directors where no shares have been issued.

     (b) No amendment affects any existing cause of action in favor of or against the

corporation, or any pending suit to which the corporation is a party, or the existing rights of

persons other than shareholders; and, in the event the corporate name is changed by amendment,

no suit brought by or against the corporation under its former name abates for that reason.

     7-1.2-906. Restated articles of incorporation. -- (a) The corporation may at any time

restate its articles of incorporation as previously amended by filing with the secretary of state

restated articles of incorporation. The restated articles of incorporation may include one or more

amendments to the articles of incorporation adopted in accordance with the provisions of Section

7-1.2-901.

     (b) The restated articles of incorporation must state all of the provisions of the articles of

incorporation as previously amended, the additional amendments to the articles of incorporation,

if any, together with a statement that such additional amendments were adopted in accordance

with the provisions of Section 7-1.2-903, and a further statement that, except for the designated

amendments, if any, the restated articles of incorporation correctly set forth without change the

corresponding provisions of the articles of incorporation as previously amended, and that the

restated articles of incorporation, together with the designated amendments, if any, supersede the

original articles of incorporation and all previous amendments to the articles of incorporation.

     7-1.2-907. Amendment of articles of incorporation in reorganization proceedings. -

(a) Whenever a plan of reorganization of a corporation has been confirmed by decree or order of

a court of competent jurisdiction in proceedings for the reorganization of the corporation,

pursuant to the provisions of any applicable statute of the United States relating to reorganizations

of corporations, the articles of incorporation of the corporation may be amended, in the manner

provided in this section, in as many respects as are necessary to carry out the plan and put into

effect, as long as the articles of incorporation, as amended, contain only provisions that might be

lawfully contained in original articles of incorporation at the time of making the amendment.

     (b) Articles of amendment approved by decree or order of the court must be executed by

the trustee or trustees of such corporation appointed in the reorganization proceedings (or a

majority thereof), or if none be appointed and acting, by the person or persons that the court

designates or appoints for the purpose, and must state the name of the corporation, the

amendments of the articles of incorporation approved by the court, the date of the decree or order

approving the articles of amendment, the title of the proceedings in which the decree or order was

entered, and a statement that the decree or order was entered by a court having jurisdiction of the

proceedings for the reorganization of the corporation pursuant to the provisions of an applicable

statute of the United States.

     (c) This section does not apply to such corporation upon the entry of a final decree in the

reorganization proceedings closing the case and discharging the trustee or trustees, if any.

     Part X. Merger.

     7-1.2-1001. Procedure for merger. - (a) Any two (2) or more domestic corporations

may merge into one of the corporations, or into a new corporation, pursuant to a plan of merger

approved in the manner provided in this chapter.

     (b) The board of directors of each corporation shall, by resolution adopted by each board,

approve a plan of merger stating:

     (1) The names of the corporations proposing to merge, and the name of the corporation

which will survive or result from the merger, which is hereinafter designated as the surviving

corporation.

     (2) The terms and conditions of the proposed merger.

     (3) The manner and basis of converting the shares of each merging corporation (other

than those held by the surviving corporation, if any) into shares or obligations or other securities

of the surviving corporation or, in whole or in part, into cash, property, or shares, obligations, or

other securities of any other corporation.

     (4) Any amendments to the articles of incorporation of the surviving corporation to be

effected by the merger, or if no amendments are desired, a statement that the articles of

incorporation of one of the corporations are the articles of incorporation of the surviving

corporation, or in the case of a new corporation, all of the statements required to be stated in

articles of incorporation for corporations organized under this chapter.

     (5) Any other provisions with respect to the proposed merger that are deemed necessary

or desirable.

     7-1.2-1002. Approval by shareholders of merger -- (a) The board of directors of each

corporation, upon approving the plan of merger, shall, by resolution, direct that the plan be

submitted to a vote at a meeting of shareholders, which may be either an annual or a special

meeting. Written notice must be given to each shareholder, whether or not entitled to vote at the

meeting, not less than twenty (20) days before the meeting, in the manner provided in this chapter

for the giving of notice of meetings of shareholders, and, whether the meeting is an annual or a

special meeting, must state that the purpose or one of the purposes is to consider the proposed

plan of merger. A copy or a summary of the plan of merger, as the case may be, together with a

statement of the shareholder’s right to dissent and a copy or a summary of Section 7-1.2-1202,

must be included in or enclosed with the notice except where no such right is available.

     (b) At each meeting, shareholders shall vote on the proposed plan of merger. The plan of

merger is approved upon receiving the affirmative vote of the holders of a majority of the shares

entitled to vote on the plan of merger of each corporation, unless any class of shares of any

corporation is entitled to vote as a class on it, in which event, as to the corporation, approval of

the plan of merger also requires the affirmative vote of the holders of a majority of the shares of

each class of shares entitled to vote as a class on it. Any class of shares of the surviving

corporation and the merged corporation in a merger is entitled to vote as a class, whether or not

the class is otherwise entitled to vote, if the plan of merger contains any provision which, if

contained in a proposed amendment to articles of incorporation, would entitle the class of shares

to a class vote.

     (c)(1) Notwithstanding the foregoing provisions of this section, except as may be

required by the articles of incorporation, no approval of a plan of merger by the shareholders of

the surviving corporation in a merger, and no notice to any of the shareholders of the corporation,

are required if:

     (i) The plan of merger does not amend the articles of incorporation of the corporation;

     (ii) The plan of merger does not involve the issuance or transfer by the corporation

(either directly or through the medium of options or warrants for, or shares or debt instruments

convertible within one year into, the shares) of shares possessing more than twenty percent (20%)

of the total combined voting power of all classes of shares then entitled to vote for the election of

directors which will be outstanding immediately after the merger; and

     (iii) Each shareholder of the corporation whose shares were outstanding immediately

before the effective date of the merger will hold the same number of shares, with identical

preferences, limitations, and relative rights, immediately after the effective date of change.

     (2) If a plan of merger is adopted by the surviving corporation in a merger without any

approval by its shareholders, pursuant to the provisions of this subsection, that fact must be

certified in the articles of merger.

     (d) After approval as already stated by each corporation, and at any time prior to the

filing of the articles of merger, the merger may be abandoned pursuant to provisions for

abandonment, if any, set forth in the plan of merger.

     7-1.2-1003. Articles of merger. - (a) Upon approval, articles of merger must be executed

by each corporation by its authorized representative and must state:

     (1) The plan of merger.

     (2) If, pursuant to Section 7-1.2-1005, the merger is to become effective at a time

subsequent to the issuance of the certificate of merger by the secretary of state, the date when the

merger is to become effective.

     (b) The original articles of merger must be delivered to the secretary of state. If the

secretary of state finds that the articles conform to law, and, unless the surviving corporation is a

Rhode Island corporation, that all fees and franchise taxes have been paid, the secretary of state

shall:

     (1) Endorse on the original the word “Filed,” and the month, day, and year of the filing;

     (2) File the original in his office; and

     (3) Issue a certificate of merger;

     (c) The secretary of state shall return the certificate of merger to the surviving or new

corporation, as the case may be, or its representative.

     7-1.2-1004. Merger of subsidiary corporation. -- (a) Any corporation owning at least

ninety percent (90%) of the outstanding shares of each class of another corporation may merge

the other corporation into itself without approval by a vote of the shareholders of either

corporation. Its board of directors shall, by resolution, approve a plan of merger stating:

     (1) The name of the subsidiary corporation and the name of the corporation owning at

least ninety percent (90%) of its shares, which is subsequently in these provisions designated as

the surviving corporation.

     (2) The manner and basis of converting the shares of the subsidiary corporation (other

than those held by the surviving corporation) into shares or other securities or obligations of the

surviving corporation or of any other corporation, or in whole or in part, into cash or other

consideration to be paid upon the surrender of each share of the subsidiary corporation.

     (b) A copy of the plan of merger must be mailed to each shareholder of the subsidiary

corporation.

     (c) Articles of merger must be executed by the surviving corporation by an authorized

officer and must state:

     (1) The plan of merger; and

     (2) If, pursuant to Section 7-1.2-1005, the merger is to become effective at a time

subsequent to the issuance of the certificate of merger by the secretary of state, the date when the

merger is to become effective.

     (d) On and after the thirtieth day after the mailing of a copy of the agreement of merger to

shareholders of the subsidiary corporation or upon the waiver of the mailing by the holders of all

outstanding shares, original articles of merger must be delivered to the secretary of state. If the

secretary of state finds that the articles conform to law, the secretary of state shall, when all fees

and franchise taxes have been paid:

     (1) Endorse on the original the word “Filed,” and the month, day, and year of the filing;

     (2) File the original in his office; and

     (3) Issue a certificate of merger.

     (e) The secretary of state shall return the certificate of merger to the surviving

corporation or its representative.

     7-1.2-1005. Effect of merger. -- (a) A merger becomes effective upon the issuance of a

certificate of merger by the secretary of state or on a later date as is stated in the plan.

     (b) When a merger becomes effective:

     (1) The several corporations, parties to the plan of merger, are a single corporation, which

is that corporation designated in the plan of merger as the surviving or new corporation.

     (2) The separate existence of all corporations, parties to the plan of merger, except the

surviving or new corporation, ceases.

     (3) The surviving or new corporation has all the rights, privileges, immunities, and

powers and is subject to all the duties and liabilities of a corporation organized under this chapter.

     (4) The surviving or new corporation at that time and subsequently possesses all the

rights, privileges, immunities, and franchises, as well of a public as of a private nature, of each of

the merging corporations; and all property, real, personal, and mixed, all debts due on whatever

account, including subscriptions to shares, all other choses in action, and all and every other

interest of or belonging to or due to each of the corporations merged, is taken and deemed to be

transferred to and vested in the single corporation without further act or deed; and the title to any

real estate, or any interest in real estate, vested in any of the corporations does not revert or is in

any way impaired because of the merger.

     (5) The surviving or new corporation is subsequently responsible and liable for all the

liabilities and obligations of each of the corporations merged or consolidated; and any claim

existing or action or proceeding pending by or against any of the corporations may be prosecuted

as if the merger had not taken place, or the surviving or new corporation may be substituted in its

place. Neither the rights of creditors nor any liens upon the property of any corporation is

impaired by the merger.

     (6) The articles of incorporation of the surviving corporation are deemed to be amended

to the extent, if any, that changes in its articles of incorporation are stated in the plan of merger;

or, in the case of a new corporation, the statements in the articles of merger which are required or

permitted to be stated in the articles of incorporation of corporations organized under this chapter

are deemed to be the original articles of incorporation of the new corporation.

     (7) The shares of the corporation or corporations party to the plan that are, under the

terms of the plan, to be converted or exchanged, cease to exist, and the holders of the shares are

entitled only to the shares, obligations, other securities, cash, or other property into which they

have been converted or for which they have been exchanged in accordance with the plan, subject

to any rights under Section 7-1.2-1201.

     7-1.2-1006. Merger of domestic and foreign corporations. -- (a) One or more foreign

corporations and one or more domestic corporations may be merged in the following manner, if

the merger is permitted by the laws of the state under which each foreign corporation is

organized:

     (1) Each domestic corporation shall comply with the provisions of this chapter with

respect to the merger of domestic corporations, and each foreign corporation shall comply with

the applicable provisions of the laws of the state under which it is organized.

     (2) If the surviving or new corporation, as the case may be, is to be governed by the laws

of any state other than this state, it shall comply with the provisions of this chapter with respect to

foreign corporations if it is to transact business in this state, and in every case it shall file with the

secretary of state of this state:

     (i) An agreement that it may be served with process in this state in any proceeding for the

enforcement of any obligation of any domestic corporation which is a party to the merger and in

any proceeding for the enforcement of the rights of a dissenting shareholder of any domestic

corporation against the surviving or new corporation;

     (ii) An irrevocable appointment of the secretary of state of this state as its agent to accept

service of process in any proceeding; and

     (iii) An agreement that it will promptly pay to the dissenting shareholders of any

domestic corporation the amount, if any, to which they are entitled under the provisions of this

chapter regarding the rights of dissenting shareholders.

     (b) The effect of the merger is the same as in the case of the merger of domestic

corporations, if the surviving or new corporation is to be governed by the laws of this state. If the

surviving or new corporation is to be governed by the laws of any state other than this state, the

effect of the merger is the same as in the case of the merger of domestic corporations except

insofar as the laws of the other state provide otherwise.

     (c) At any time prior to the filing of the articles of merger, the merger may be abandoned

pursuant to provisions for abandonment, if any, stated in the plan of merger.

     Part XI. Dispositions.

     7-1.2-1101. Sale of assets in regular course of business and mortgage or pledge of

assets. - The sale, lease, exchange, or other disposition of all, or substantially all, the property and

assets of a corporation in the usual and regular course of its business, and the mortgage or pledge

of any or all property and assets of a corporation, whether or not in the usual and regular course

of business, may be made upon terms and conditions and for any consideration, which may

consist in whole or in part of money or property, real or personal, including shares of any other

corporation, domestic or foreign, as is authorized by its board of directors; and in any case no

authorization or consent of the shareholders is required.

     7-1.2-1102. Sale of assets other than in regular course of business. -- A sale, lease,

exchange, or other disposition of all, or substantially all, the property and assets, with or without

the good will, of a corporation, if not in the usual and regular course of its business, may be made

upon terms and conditions and for any consideration, which may consist in whole or in part of

money or property, real or personal, including shares of any other corporation, domestic or

foreign, as is authorized in the following manner:

     (a) The board of directors’ adoption of a resolution recommending the sale, lease,

exchange, or other disposition, and directing the submission of the resolution to a vote at a

meeting of shareholders, which may be either an annual or a special meeting.

     (b) Written notice must be given to each shareholder, whether or not entitled to vote at

the meeting, not less than twenty (20) days before the meeting, in the manner provided in this

chapter for the giving of notice of meeting of shareholders. The notice must state whether the

meeting is an annual or a special meeting, and that the purpose, or one of the purposes, is to

consider the proposed sale, lease, exchange, or other disposition. A statement of the

shareholder’s right to dissent and a copy or summary of Section 7-1.2-1202 must be included in

or enclosed with the notice.

     (c) At the meeting the shareholders may authorize the sale, lease, exchange, or other

disposition and may fix, or may authorize the board of directors to fix, any or all of the terms and

conditions of it and the consideration to be received by the corporation for it. The authorization

requires the affirmative vote of the holders of a majority of the shares of the corporation entitled

to vote on the authorization, unless any class of shares is entitled to vote on it as a class, pursuant

to the articles of incorporation, in which event approval of the resolution also requires the

affirmative vote of the holders of a majority of the shares of each class of shares entitled to vote

as a class on the resolution.

     (d) After the authorization by a vote of shareholders, the board of directors nevertheless,

in its discretion, may abandon the sale, lease, exchange, or other disposition of assets, subject to

the rights of third parties under any related contracts, without any further action or approval by

shareholders.

     (e) A transfer of all or substantially all of the property and assets of a corporation (i) to

one (1) or more subsidiary corporations in which the transferor corporation owns shares

possessing at least two-thirds (2/3) of the total combined voting power of all classes of shares

entitled to vote at that time for election of directors, or (ii) for cash, with or without an

assumption of liabilities of the transferor corporation is governed by the provisions of Section 7-

1.2-1101 and not by this section. The sale, lease, exchange, or other disposition of all, or

substantially all, the property and assets, with or without the good will, of one or more

subsidiaries in which the parent corporation owns shares possessing two-thirds (2/3) or more of

the total combined voting power of all classes of shares entitled at that time to vote for the

election of directors is treated as a disposition of all, or substantially all, the property and assets of

the parent corporation within the meaning of this section if the shares of the subsidiary or

subsidiaries constitute all or substantially all the property and assets of the parent corporation.

     Part XII. Dissenters’ Rights.

     7-1.2-1201. Right of shareholders to dissent. - (a) Any shareholder of a corporation has

the right to dissent from any of the following corporate actions:

     (1) Any plan of merger to which the corporation is a party, provided articles of merger

have been filed in connection with the transaction under Section 7-1.2-1003, unless the

corporation is the surviving corporation in a merger and the approval of its shareholders was not

required by virtue of the provisions of either Section 7-1.2-1002 or Section 7-1.2-1004; or

     (2) Any sale or exchange of all or substantially all of the property and assets of a

corporation which requires the approval of the shareholders under Section 7-1.2-1102.

     (b) A shareholder may not dissent as to less than all of the shares registered in his name

which are owned beneficially by him. A nominee or fiduciary may not dissent on behalf of any

beneficial owner as to less than all of the shares of the owner registered in the name of the

nominee or fiduciary.

     (c) Unless otherwise provided in the articles of incorporation of the issuing corporation,

there is no right to dissent for the holders of the shares of any class or series which, on the date

fixed to determine the shareholders entitled to receive notice of the proposed transaction (or a

copy of the agreement of merger under Section 7-1.2-1004), were:

     (1) Registered on a national securities exchange or included as national market securities

in the national association of securities dealers automated quotations system or any successor

national market system; or

     (2) Held of record by not less than two thousand (2,000) shareholders.

     (d) A shareholder entitled to the right to dissent under this section may not challenge a

completed corporate action for which the right to dissent is available unless such corporate action:

     (1) was not effectuated in accordance with the applicable provisions of this chapter or the

corporation’s articles of incorporation, bylaws or board of directors’ resolution authorizing the

corporate action; or

     (2) was procured as a result of fraud or material misrepresentation.

     7-1.2-1202. Rights of dissenting shareholders. - (a) Any shareholder electing to

exercise the right of dissent shall file with the corporation, prior to or at the meeting of

shareholders at which the proposed corporate action is submitted to a vote, a written objection to

the proposed corporate action. If the proposed corporate action is approved by the required vote

and the shareholder has not voted in favor of it, the shareholder may, within ten (10) days after

the date on which the vote was taken, or if a corporation is to be merged without a vote of its

shareholders into another corporation, any of its shareholders may, within fifteen (15) days after

the plan of the merger has been mailed to the shareholders, make written demand on the

corporation, or, in the case of a merger, on the surviving or new corporation, domestic or foreign,

for payment of the fair value of the shareholder’s shares. If the proposed corporate action is

effected, the corporation shall pay to the shareholder, upon surrender of the certificate or

certificates representing the shares, the fair value of the shares as of the day prior to the date on

which the vote was taken approving the proposed corporate action, excluding any appreciation or

depreciation in anticipation of the corporate action. Any shareholder failing to make demand

within the ten (10) day period or the fifteen (15) day period, as the case may be, is bound by the

terms of the proposed corporate action. Any shareholder making the demand is thereafter only

entitled to payment as provided in this section and is not entitled to vote or to exercise any other

rights of a shareholder.

     (b) No demand may be withdrawn unless the corporation consents to it. If, however, the

demand is withdrawn upon consent, or if the proposed corporate action is abandoned or rescinded

or the shareholders revoke the authority to effect the action, or if, in the case of a merger, on the

date of the filing of the articles of merger the surviving corporation is the owner of all the

outstanding shares of the other corporations, domestic and foreign, that are parties to the merger,

or if no demand or petition for the determination of fair value by a court has been made or filed

within the time provided in this section, or if a court of competent jurisdiction determines that the

shareholder is not entitled to the relief provided by this section, then the right of the shareholder

to be paid the fair value of his shares ceases and his status as a shareholder is restored, without

prejudice to any corporate proceedings taken during the interim.

     (c) Within ten (10) days after the corporate action is effected, the corporation, or, in the

case of a merger, the surviving or new corporation, domestic or foreign, shall give written notice

of the action to each dissenting shareholder who has made demand as provided in these

provisions, and shall make a written offer to each dissenting shareholder to pay for the shares at a

specified price deemed by the corporation to be the fair value of the shares. The notice and offer

must be accompanied by a balance sheet of the corporation the shares of which the dissenting

shareholder holds, as of the latest available date and not more than twelve (12) months prior to

the making of the offer, and a profit and loss statement of the corporation for the twelve (12)

month period ended on the date of the balance sheet.

     (d) If within thirty (30) days after the date on which the corporate action was effected the

fair value of the shares is agreed upon between any dissenting shareholder and the corporation,

payment for the shares must be made within ninety (90) days after the date on which the

corporate action was effected, upon surrender of the certificate or certificates representing the

shares. Upon payment of the agreed value, the dissenting shareholder ceases to have any interest

in the shares.

     (e) If within the period of thirty (30) days a dissenting shareholder and the corporation do

not agree on the matter, then the corporation, within thirty (30) days after receipt of written

request for the filing from any dissenting shareholder given within sixty (60) days after the date

on which the corporate action was effected, shall, or at its election at any time within the period

of sixty (60) days may, file a petition in any court of competent jurisdiction in the county in this

state where the registered office of the corporation is located praying that the fair value of the

shares is found and determined. If, in the case of a merger, the surviving or new corporation is a

foreign corporation without a registered office in this state, the petition must be filed in the

county where the registered office of the domestic corporation was last located. If the corporation

fails to institute the proceeding as provided, any dissenting shareholder may do so in the name of

the corporation. All dissenting shareholders, wherever they reside, must be made parties to the

proceeding as an action against their shares quasi in rem. A copy of the petition must be served

on each dissenting shareholder who is a resident of this state and served by registered or certified

mail on each dissenting shareholder who is a nonresident. Service on nonresidents may also be

made by publication as provided by law. The jurisdiction of the court is plenary and exclusive.

All shareholders who are parties to the proceeding are entitled to judgment against the

corporation for the amount of the fair value of their shares. The court may, if it so elects, appoint

one or more persons as appraisers to receive evidence and recommend a decision on the question

of fair value. The appraisers have the power and authority that is specified in the order of their

appointment or an amendment of the order. The judgment is payable only upon and concurrently

with the surrender to the corporation of the certificate or certificates representing the shares.

Upon payment of the judgment, the dissenting shareholder ceases to have any interest in the

shares.

     (f) The judgment should include an allowance for interest at the rate of interest on

judgments in civil actions from the date on which the vote was taken on the proposed corporate

action to the date of payment.

     (g) The court shall determine and assess the costs and expenses of any proceeding against

the corporation, but all or any part of the costs and expenses may be apportioned and assessed as

the court deems equitable against any or all of the dissenting shareholders who are parties to the

proceeding to whom the corporation has made an offer to pay for the shares if the court finds that

the action of the shareholders in failing to accept the offer was arbitrary or vexatious or not in

good faith. The expenses include reasonable compensation for and reasonable expenses of the

appraisers, but exclude the fees and expenses of counsel for and experts employed by any party;

but if the fair value of the shares as determined materially exceeds the amount which the

corporation offered to pay for the shares, or if no offer was made, the court in its discretion may

award to any shareholder who is a party to the proceeding a sum that the court determines to be

reasonable compensation to any expert or experts employed by the shareholder in the proceeding.

     (h) Within twenty (20) days after demanding payment for his shares, each shareholder

demanding payment shall submit the certificate or certificates representing his shares to the

corporation for notation on the certificate that the demand has been made. His failure to do so

may, at the option of the corporation, terminate his rights under this section unless a court of

competent jurisdiction, for good and sufficient cause shown, directs otherwise. If shares

represented by a certificate on which notation has been made are transferred, each new certificate

issued for the shares must bear similar notation, together with the name of the original dissenting

holder of the shares, and a transferee of the shares acquires by the transfer no rights in the

corporation other than those which the original dissenting shareholder had after making demand

for payment of the fair value of the shares.

     (i) Shares acquired by a corporation pursuant to payment of the agreed value for the

shares or to payment of the judgment entered for the shares, as provided in this section, may be

held and disposed of by the corporation. However, in the case of a merger, they may be held and

disposed of as the plan of merger otherwise provides.

     Part XIII. Dissolution and Revocation.

     7-1.2-1301. Voluntary dissolution by incorporators. -- (a) A corporation which has not

commenced business and which has not issued any shares, may be voluntarily dissolved by its

incorporators at any time in the following manner:

     (1) Articles of dissolution are executed by a majority of the incorporators, and verified by

them, and state:

     (i) The name of the corporation.

     (ii) The date of issuance of its certificate of incorporation.

     (iii) That none of its shares has been issued.

     (iv) That the corporation has not commenced business.

     (v) That the amount, if any, actually paid in on subscriptions for its shares, less any part

of the amount disbursed for necessary expenses, has been returned to those entitled to it.

     (vi) That no debts of the corporation remain unpaid.

     (vii) That a majority of the incorporators elect that the corporation be dissolved.

     (2) The original articles of dissolution are delivered to the secretary of state. If the

secretary of state finds that the articles of dissolution conform to law, the secretary of state shall,

when all fees and franchise taxes have been paid:

     (i) Endorse on the original the word “Filed,” and the month, day, and year of the filing.

     (ii) File the original in his office.

     (iii) Issue a certificate of dissolution.

     (b) The certificate of dissolution is delivered to the incorporators or their representative.

Upon the issuance of the certificate of dissolution by the secretary of state, the existence of the

corporation ceases.

     7-1.2-1302. Voluntary dissolution by consent of shareholders. -- (a) A corporation

may be voluntarily dissolved by the written consent of all of its shareholders entitled to vote

thereon.

     (b) Upon the adoption of the resolution:

     (1) The corporation shall execute and file articles of dissolution in accordance with

Sections 7-1.2-1308 and 7-1.2-1309.

     (2) The corporation immediately delivers notice of the filing to each known creditor of

the corporation.

     (3) The corporation shall proceed to collect its assets, sell or otherwise dispose of those of

its properties that are not to be distributed in kind to its shareholders, pay, satisfy, and discharge

its liabilities and obligations and do all other acts required to liquidate its business and affairs.

After paying or adequately providing for the payment of all its obligations, the corporation

distributes the remainder of its assets, either in cash or in kind, among its shareholders according

to their respective rights and interests.

     (4) The corporation, at any time during the liquidation of its business and affairs, may

apply to a court of competent jurisdiction within the state and county in which the registered

office or principal place of business of the corporation is situated, to have the liquidation

continued under the supervision of the court as provided in this chapter.

     7-1.2-1303. Voluntary dissolution by act of corporation. - A corporation may be

dissolved by the act of the corporation, when authorized in the following manner:

     (1) The board of directors adopts a resolution recommending that the corporation be

dissolved, and directing that the question of the dissolution be submitted to a vote at a meeting of

the shareholders, which may be either an annual or a special meeting.

     (2) Written notice is given to each shareholder entitled to vote at the meeting within the

time and in the manner provided in this chapter for the giving of notice of meetings of

shareholders, and, whether the meeting is an annual or special meeting, states that the purpose, or

one of the purposes, of the meeting is to consider the advisability of dissolving the corporation.

     (3) At the meeting a vote of shareholders entitled to vote at the meeting is taken on a

resolution to dissolve the corporation. The resolution is adopted upon receiving the affirmative

vote of the holders of a majority of the shares of the corporation entitled to vote on the resolution,

unless any class of shares is entitled to vote on the resolution as a class, in which event approval

of the resolution also requires the affirmative vote of the holders of a majority of the shares of

each class of shares entitled to vote as a class and of the total shares entitled to vote on the

resolution.

     (4) Upon the adoption of the resolution, the corporation shall execute and file articles of

dissolution in accordance with Sections 7-1.2-1308 and 7-1.2-1309.

     (5) The corporation immediately delivers notice of the filing to each known creditor of

the corporation.

     (6) The corporation shall proceed to collect its assets, sell or otherwise dispose of those of

its properties that are not to be distributed in kind to its shareholders, pay, satisfy, and discharge

its liabilities and obligations and do all other acts required to liquidate its business and affairs.

After paying or adequately providing for the payment of all its obligations, the corporation

distributes the remainder of its assets, either in cash or in kind, among its shareholders according

to their respective rights and interests.

     (7) The corporation, at any time during the liquidation of its business and affairs, may

apply to a court of competent jurisdiction within the state and county in which the registered

office or principal place of business of the corporation is situated, to have the liquidation

continued under the supervision of the court as provided in this chapter.

     7-1.2-1304. Revocation of voluntary dissolution proceedings by consent of

shareholders. - (a) By the written consent of all of its shareholders entitled to vote thereon, a

corporation may, within 120 days of its effective date of the articles of dissolution, revoke

voluntary dissolution proceedings previously taken, in the following manner:

     (b) Upon the execution of the written consent, a statement of revocation of voluntary

dissolution proceedings is executed by the corporation by its authorized representative. The

statement proclaims:

     (1) The name of the corporation.

     (2) The names and respective addresses of its officers.

     (3) The names and respective addresses of its directors.

     (4) A copy of the written consent signed by all shareholders of the corporation revoking

the voluntary dissolution proceedings.

     (5) That the written consent has been signed by all shareholders entitled to vote thereon

of the corporation or signed in their names by their authorized attorneys.

     7-1.2-1305. Revocation of voluntary dissolution proceedings by act of corporation. -

By the act of the corporation, a corporation may, at any time within one hundred twenty (120)

days of its effective date of the articles of dissolution, revoke voluntary dissolution proceedings

previously taken, in the following manner:

     (a) The board of directors adopts a resolution recommending that the voluntary

dissolution proceedings be revoked, and directing that the question of the revocation be submitted

to a vote at a special meeting of shareholders.

     (b) Written notice, stating that the purpose, or one of the purposes, of the meeting is to

consider the advisability of revoking the voluntary dissolution proceedings, is given to each

shareholder entitled to vote at the meeting within the time and in the manner provided in this

chapter for the giving of notice of special meetings of shareholders.

     (c) At the meeting, a vote of the shareholders entitled to vote at the meeting is taken on a

resolution to revoke the voluntary dissolution proceedings, which requires for its adoption the

affirmative vote of the holders of a majority of the shares entitled to vote on the resolution.

     (d) Upon the adoption of the resolution, a statement of revocation of voluntary

dissolution proceedings is executed by the corporation by its authorized representative. The

statement proclaims:

     (1) The name of the corporation.

     (2) The names and respective addresses of its officers.

     (3) The names and respective addresses of its directors.

     (4) A copy of the resolution adopted by the shareholders revoking the voluntary

dissolution proceedings.

     (5) The number of shares outstanding.

     (6) The number of shares voted for and against the resolution, respectively.

     7-1.2-1306. Filing of statement of revocation of voluntary dissolution proceedings. -

The statement of revocation of voluntary dissolution proceedings, whether by consent of

shareholders or by act of the corporation, is delivered to the secretary of state. If the secretary of

state finds that the statement conforms to law, the secretary of state shall, when all fees and

franchise taxes have been paid:

     (a) Endorse on the original the word “Filed,” and the month, day, and year of the filing.

     (b) File the original in his office.

     7-1.2-1307. Effect of statement of revocation of voluntary dissolution proceedings. -

(a) Upon the filing by the secretary of state of a statement of revocation of voluntary dissolution

proceedings, whether by consent of shareholders or by act of the corporation, the revocation of

the voluntary dissolution proceedings becomes effective and the corporation may again carry on

its business.

     (b) Revocation of dissolution is effective upon the effective date of the statement of

revocation of voluntary dissolution.

     (c) When the revocation of dissolution is effective, it relates back to and takes effect as of

the effective date of the dissolution and the corporation resumes carrying on its business as if

dissolution had never occurred, except as subsequently provided.

     (d) If, as permitted by the provisions of this title, another corporation, whether business

or nonprofit, limited partnership, limited liability partnership or limited liability company,

domestic or foreign, qualified to transact business in this state, bears or has filed a fictitious

business name statement with respect to or reserved or registered a name which is not the same

as, or deceptively similar to, the name of a corporation with respect to which the certificate of

revocation is proposed to be withdrawn, then the secretary of state shall condition effectiveness of

the statement of revocation of voluntary dissolution upon the amendment by the corporation

revoking voluntary dissolution proceedings of its articles of incorporation or otherwise complying

with the provisions of this chapter with respect to the use of a name available to it under the laws

of this state so as to designate a name which is the same as, or deceptively similar to, its former

name.

     7-1.2-1308. Articles of dissolution. -- The corporation shall execute articles of

dissolution by its authorized officer. The statement proclaims:

     (a) The name of the corporation.

     (b) That all debts, obligations, and liabilities of the corporation have been paid and

discharged or that adequate provision has been made for the payment.

     (c) That all the remaining property and assets of the corporation have been distributed

among its shareholders in accordance with their respective rights and interests.

     (d) That there are not suits pending against the corporation in any court, or that adequate

provision has been made for the satisfaction of any judgment, order, or decree which may be

entered against it in any pending suit.

     7-1.2-1309. Filing of articles of dissolution. -- (a) The articles of dissolution are

delivered to the secretary of state. If the secretary of state finds that the articles of dissolution

conform to law, the secretary of state shall, when all fees and franchise taxes have been paid:

     (1) Endorse on the original the word “Filed,” and the month, day, and year of the filing.

     (2) File the original in his office.

     (3) Issue a certificate of dissolution.

     (b) The certificate of dissolution is delivered to the representative of the dissolved

corporation. Upon the issuance of the certificate of dissolution the existence of the corporation

ceases, except for the purpose of suits, other proceedings, and appropriate corporate action by

shareholders, directors, and officers as provided in this chapter.

     7-1.2-1310. Revocation of articles of incorporation. -- (a) The articles of incorporation

of a corporation may be revoked by the secretary of state upon the conditions prescribed in this

section when it is established that:

     (1) The corporation procured its articles of incorporation through fraud; or

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

law; or

     (3) The corporation has failed to file its annual report within the time required by this

chapter, or has failed to pay any fees, when they have become due and payable; or

     (4) The corporation has failed for thirty (30) days to appoint and maintain a registered

agent in this state as required by this chapter; or

     (5) The corporation has failed, after change of its registered office or registered agent, to

file in the office of the secretary of state a statement of the change as required by this chapter; or

     (6) The corporation has failed to file in the office of the secretary of state any amendment

to its articles of incorporation or any articles of merger within the time prescribed by this chapter;

or

     (7) A misrepresentation has been made of any material matter in any application, report,

affidavit, or other document submitted by the corporation pursuant to this chapter.

     (b) No articles of incorporation of a corporation may be revoked by the secretary of state

unless:

     (1) The secretary of state gives the corporation not less than sixty (60) days notice thereof

by regular mail addressed to the registered office of the corporation in this state on file with the

secretary of state’s office; provided, however, that if a prior mailing addressed to the registered

office of the corporation in this state currently on file with the secretary of state’s office has been

returned to the secretary of state as undeliverable by the United States Postal Service for any

reason, or if the revocation notice is returned as undeliverable to the secretary of state’s office by

the United States Postal Service for any reason, the secretary of state gives notice as follows:

     (i) To the corporation at its principal office of record as shown in its most recent annual

report, and no further notice is required; or

     (ii) In the case of a domestic corporation which has not yet filed an annual report, then to

any one of the incorporators listed on the articles of incorporation, and no further notice is

required; and

     (2) The corporation fails prior to revocation to file the annual report or pay the fees, or

file the required statement of change of registered agent or registered office, or file the articles of

amendment or articles of merger, or correct the misrepresentation.

     7-1.2-1311. Issuance of certificates of revocation. - (a) Upon revoking any certificate of

incorporation, the secretary of state shall:

     (1) Issue a certificate of revocation;

     (2) File the certificate in his office; and

     (3) Send to the corporation by regular mail a copy of the certificate of revocation,

addressed to the registered office of the corporation in this state on file with the secretary of

state’s office; provided, however, that if a prior mailing addressed to the registered office of the

corporation in this state currently on file with the secretary of state’s office has been returned to

the secretary of state as undeliverable by the United States Postal Service for any reason, or if the

revocation certificate is returned as undeliverable to the secretary of state’s office by the United

States Postal Service for any reason, the secretary of state shall give notice as follows:

     (i) To the corporation at its principal office of record as shown in its most recent annual

report, and no further notice is required; or

     (ii) In the case of a domestic corporation which has not yet filed an annual report, then to

any one of the incorporators listed on the articles of incorporation, and no further notice is

required.

     (b) Upon the issuance of the certificate of revocation, the authority of the corporation to

transact business in this state ceases.

     (c) Notwithstanding anything to the contrary, the issuance of a certificate of revocation of

a corporation does not terminate the authority of its registered agent.

     7-1.2-1312. Withdrawal of certificate of revocation. -- (a) Within ten (10) years after

issuing a certificate of revocation as provided in Section 7-1.2-1311, the secretary of state may

withdraw the certificate of revocation and retroactively reinstate the corporation in good standing

as if its articles of incorporation had not been revoked, except as subsequently provided:

     (1) Upon the filing by the corporation of the documents it had previously failed to file as

set forth in subdivisions (3) through (6) inclusive, of Section 7-1.2-1310(a); and

     (2) Upon the payment by the corporation of a penalty for each year or part of a year that

has elapsed since the issuance of the certificate of revocation.

     (b) If, as permitted by the provisions of this title, another corporation, whether business

or nonprofit, limited partnership, limited liability partnership or limited liability company, or

domestic or foreign, qualified to transact business in this state, bears or has filed a fictitious

business name statement with respect to or reserved or registered a name which is not the same

as, or deceptively similar to, the name of a corporation with respect to which the certificate of

revocation is proposed to be withdrawn, then the secretary of state shall condition the withdrawal

of the certificate of revocation upon the reinstated corporation’s amending its articles of

incorporation or otherwise complying with the provisions of this chapter with respect to the use

of a name available to it under the laws of this state so as to designate a name which is not be the

same as, or deceptively similar to, its former name.

     (c) Upon the withdrawal of the certificate of revocation and reinstatement of the

corporation in good standing as provided in subsection (a), title to any real estate, or any interest

in real estate, held by the corporation at the time of the issuance of the certificate of revocation

and not conveyed subsequent to the revocation of its articles of incorporation is deemed to be

revested in the corporation without further act or deed.

     7-1.2-1313. Appeal from revocation of articles of incorporation. - Any corporation

aggrieved by the action of the secretary of state in revoking its articles of incorporation may

appeal the action in the manner provided in Section 7-1.2-1601.

      7-1.2-1314. Jurisdiction of court to liquidate assets and business of corporation. - (a)

The superior court has full power to liquidate the assets and business of a corporation:

     (1) In an action by a shareholder when it is established that, whether or not the corporate

business has been or could be operated at a profit, dissolution would be beneficial to the

shareholders because:

     (i) The directors or those other individuals that may be responsible for management

pursuant to Section 7-1.2-1701(a) are deadlocked in the management of the corporate affairs and

the shareholders are unable to break the deadlock; or

     (ii) The acts of the directors or those in control of the corporation are illegal, oppressive,

or fraudulent; or

     (iii) The shareholders are deadlocked in voting power, and have failed, for a period which

includes at least two (2) 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;

or

     (iv) The corporate assets are being misapplied or are in danger of being wasted or lost; or

     (v) Two (2) or more factions of shareholders are divided and there is such internal

dissension that serious harm to the business and affairs of the corporation is threatened; or

     (vi) The holders of one-half (1/2) or more of all the outstanding shares of the corporation

have voted to dissolve the corporation;

     (2)(i) 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 are being misapplied or are in danger

of being wasted or lost.

     (ii) If it is established that the claim of a creditor has been reduced to judgment and an

execution on the judgment returned unsatisfied or that a corporation has admitted, in writing, that

the claim of a creditor is due and owing, the establishment of the facts are prima facie evidence of

insolvency.

     (iii) Every petition filed by a creditor for the liquidation of the assets and business of a

corporation must contain a statement as to whether the creditor is or is not an officer, director, or

shareholder of the corporation. Every petition for the liquidation of the assets and business of a

corporation filed by an officer, director, or shareholder of a corporation or by a creditor who is an

officer, director or shareholder, must contain, to the best of petitioner’s knowledge, information,

and belief, the names and addresses of all known creditors of any class of the corporation.

     (3) When an action has been filed by the attorney general to dissolve a corporation and it

is established that liquidation of its business and affairs should precede the entry of a decree of

dissolution.

     (b) Proceedings under subsections (a)(1) or (a)(2) should be brought in the county in

which the registered or principal office of the corporation is situated.

     (c) It is not necessary to make shareholders parties to any action or proceeding unless

relief is sought against them personally.

     7-1.2-1315. Avoidance of dissolution by share buyout. -- Whenever a petition for

dissolution of a corporation is filed by one or more shareholders (subsequently in this section

referred to as the “petitioner”) pursuant to either Section 7-1.2-1314 or a right to compel

dissolution which is authorized under Section 7-1.2-1701 or is otherwise valid, one or more of its

other shareholders may avoid the dissolution by filing with the court prior to the commencement

of the hearing, or, in the discretion of the court, at any time prior to a sale or other disposition of

the assets of the corporation, an election to purchase the shares owned by the petitioner at a price

equal to their fair value. If the shares are to be purchased by other shareholders, notice must be

sent to all shareholders of the corporation other than the petitioner, giving them an opportunity to

join in the election to purchase the shares. If the parties are unable to reach an agreement as to

the fair value of the shares, the court shall, upon the giving of a bond or other security sufficient

to assure to the petitioner payment of the value of the shares, stay the proceeding and determine

the value of the shares, in accordance with the procedure set forth in Section 7-1.2-1202, as of the

close of business on the day on which the petition for dissolution was filed. Upon determining

the fair value of the shares, the court shall state in its order directing that the shares be purchased,

the purchase price and the time within which the payment is to be made, and may decree any

other terms and conditions of sale that it determines to be appropriate, including payment of the

purchase price in installments extending over a period of time, and, if the shares are to be

purchased by shareholders, the allocation of shares among shareholders electing to purchase

them, which, so far as practicable, are to be proportional to the number of shares previously

owned. The petitioner is entitled to interest, at the rate on judgments in civil actions, on the

purchase price of the shares from the date of the filing of the election to purchase the shares, and

all other rights of the petitioner as owner of the shares terminate on that date. The costs of the

proceeding, which include reasonable compensation and expenses of appraisers but not fees and

expenses of counsel or of experts retained by a party, will be allocated between or among the

parties as the court determines. Upon full payment of the purchase price, under the terms and

conditions specified by the court, or at any other time that is ordered by the court, the petitioner

shall transfer the shares to the purchaser.

     7-1.2-1316. Procedure in liquidation of corporation by court. - (a) In proceedings to

liquidate the assets and business of a corporation the court has general equity jurisdiction and

power to issue any orders, injunctions, and decrees that justice and equity require, to appoint a

receiver or receivers pendente lite, with any powers and duties that the court, from time to time,

directs, and to take any other proceedings that are requisite to preserve the corporate assets

wherever situated, and carry on the business of the corporation until a full hearing can be had.

     (b) After a hearing had upon any notice that the court directs to be given to all parties to

the proceedings and to any other parties in interest designated by the court, the court may appoint

a liquidating receiver or receivers with authority to take charge of any of the corporation’s estate

and effects of which he has been appointed receiver and to collect the assets of the corporation,

including all amounts owing to the corporation whether by shareholders on account of any unpaid

portion of the consideration for the issuance of shares or otherwise.

     (c) The hearing date for the appointment of a permanent receiver is not to be more than

twenty-one (21) days after commencement of the action, unless the hearing date is extended by

the court for good cause shown.

     (d) The liquidating receiver or receivers has authority subject to court order, to sue and

defend in all courts in his own name as receiver of the corporation, or in its name, to intervene in

any action or proceeding relating to its assets or business, to compromise any dispute or

controversy, to preserve the assets of the corporation, to carry on its business, to sell, convey, and

dispose of all or any part of the assets of the corporation wherever situated, either at public or

private sale, to redeem any mortgages, security interests, pledges, or liens of or upon any of its

assets, and generally to do all other acts which might be done by the corporation or that is

necessary for the administration of his trust according to the course of equity. The assets of the

corporation or the proceeds resulting from a sale, conveyance, or other disposition of the assets

will be applied to the expenses of the liquidation and to the payment of the liabilities and

obligations of the corporation, and any remaining assets or proceeds will distributed under the

direction of the court among its shareholders according to their respective rights and interests.

The order appointing the receiver or receivers sets forth their powers and duties. The powers and

duties may be increased or diminished at any time during the proceeding.

     (e) The court has power to allow from time to time as expenses of the liquidation

compensation to the receiver or receivers and to attorneys in the proceeding, and to direct the

payment of the compensation out of the assets of the corporation or the proceeds of any sale or

disposition of the assets.

     (f) The court appointing the receiver has exclusive jurisdiction of the corporation and its

property, wherever situated, and of all questions arising in the proceedings concerning the

property.

     7-1.2-1317. Bond of receivers. - A receiver shall in all cases give any bond that the court

directs with any sureties that the court requires.

     7-1.2-1318. Filing of claims in liquidation proceedings. -- In proceedings to liquidate

the assets and business of a corporation, the court may require all creditors of the corporation to

file with the receiver, in any form that the court prescribes, proofs under oath of their respective

claims. If the court requires the filing of claims it shall fix a date, which is not to be less than four

(4) months from the date of the order, as the last day for the filing of claims, and shall prescribe

the notice that is to be given to creditors and claimants of the fixed date. Prior to the fixed date,

the court may extend the time for the filing of claims. Creditors and claimants failing to file

proofs of claim on or before the fixed date may be barred, by court order, from participating in

the distribution of the assets of the corporation.

     7-1.2-1319. Discontinuance of liquidation proceedings. - The liquidation of the assets

and business of a corporation may be discontinued at any time during the liquidation proceedings

when it is established that cause for liquidation no longer exists. In that event the court dismisses

the proceedings, direct the receiver to redeliver to the corporation all its remaining property and

assets, and order any notice to creditors that the court deems proper under the circumstances.

     7-1.2-1320. Decree of involuntary dissolution. - In proceedings to liquidate the assets

and business of a corporation, when the costs and expenses of the proceedings and all debts,

obligations, and liabilities of the corporation have been paid and discharged and all of its

remaining property and assets distributed to its shareholders, or in case its property and assets are

not sufficient to satisfy and discharge the costs, expenses, debts, and obligations, all the property

and assets have been applied as far as they will go to their payment, the court shall enter a decree

dissolving the corporation, at which time the existence of the corporation ceases.

     7-1.2-1321. Filing of decree of dissolution. - In case the court enters a decree dissolving

a corporation, it is the duty of the clerk of the court to file a certified copy of the decree with the

secretary of state. There is no fee charged by the secretary of state for that filing.

     7-1.2-1322. Deposit with state treasury of amount due certain shareholders. - Upon

the voluntary or involuntary dissolution of a corporation, the portion of the assets distributable to

a creditor or shareholder who is unknown or cannot be found, or who is under disability and there

is no person legally competent to receive the distributive portion, will be reduced to cash and

deposited with the general treasury and paid over to the creditor or shareholder or to his legal

representative upon satisfactory proof to the general treasury of his right to the payment.

     7-1.2-1323. Jurisdiction of court to appoint a receiver. -- Upon the establishment of

any of the grounds for liquidation of the assets and business of (1) a domestic corporation or (2) a

foreign corporation, to the extent the foreign corporation has assets within the state, stated in

Section 7-1.2-1314, and upon the establishment that the liquidation would not be appropriate, the

superior court has full power to appoint a receiver, with any powers and duties that the court,

from time to time, directs, and to take any other proceedings that the court deems advisable under

the circumstances. The provisions of Sections 7-1.2-1314 through 7-1.2-1322, insofar as they are

consistent with the nature of the proceeding, apply to the proceeding, and in the proceeding the

court has the full powers of a court of equity to make or enter any orders, injunctions, and decrees

and grant any other relief in the proceeding that justice and equity require.

     7-1.2-1324. Survival of remedy after dissolution. - The dissolution of a corporation

either:

     (a) by the issuance of a certificate of dissolution by the secretary of state; or

     (b) by a decree of court when the court has not liquidated the assets and business of the

corporation as provided in this chapter; or

     (c) by expiration of its period of duration; does not take away or impair any remedy

available to or against the corporation, its directors, officers, or shareholders, for any right or

claim existing, or any liability incurred, prior to the dissolution if action or other proceeding on

the right, claim, or liability is commenced within two (2) years after the date of the dissolution.

Any action or proceeding by or against the corporation may be prosecuted or defended by the

corporation in its corporate name. The shareholders, directors, and officers have power to take

any corporate or other action that is appropriate to protect the remedy, right, or claim. If the

corporation was dissolved by the expiration of its period of duration, the corporation may amend

its articles of incorporation at any time during the period of two (2) years so as to extend its

period of duration.

     7-1.2-1325. Continuation of certain corporate powers. -- Any corporation dissolved in

any manner under this chapter or any corporation whose existence is terminated under Section

44-12-8 or any corporation whose articles of incorporation are revoked by the secretary of state

under Section 7-1.2-1310 nevertheless continues for five (5) years after the date of the

dissolution, termination, or revocation for the purpose of enabling it to settle and close its affairs,

to dispose of and convey its property, to discharge its liabilities, and to distribute its assets, but

not for the purpose of continuing the business for which it was organized. The shareholders,

directors, and officers have power to take any corporate or other action that is appropriate to carry

out the purposes of this section.

     Part XIV. Foreign Corporations.

     7-1.2-1401. Admission of foreign corporation and other entities. - (a) No foreign

corporation has the right to transact business in this state until it has procured a certificate of

authority to do so from the secretary of state. No foreign corporation is entitled to procure a

certificate of authority under this chapter to transact any business in this state which a corporation

organized under this chapter is not permitted to transact. A foreign corporation may not be

denied a certificate of authority because the laws of the state or country under which the

corporation is organized governing its organization and internal affairs differ from the laws of this

state, and nothing contained in this chapter authorizes this state to regulate the organization or the

internal affairs of the corporation.

     (b) Without excluding other activities which may not constitute transacting business in

this state, a foreign corporation is not considered to be transacting business in this state, for the

purposes of this chapter, because of carrying on in this state any one or more of the following

activities:

     (1) Maintaining or defending any action or suit or any administrative or arbitration

proceeding, or effecting the settlement of the suit or the settlement of claims or disputes.

     (2) Holding meetings of its directors or shareholders or carrying on other activities

concerning its internal affairs.

     (3) Maintaining bank accounts.

     (4) Maintaining offices or agencies for the transfer, exchange, and registration of its

securities, or appointing and maintaining trustees or depositaries with relation to its securities.

     (5) Effecting sales through independent contractors.

     (6) Soliciting or procuring orders, whether by mail or through employees or agents or

otherwise, where the orders require acceptance outside of this state before becoming binding

contracts.

     (7) Creating as borrower or lender, or acquiring indebtedness or mortgages or other

security interests in real or personal property.

     (8) Securing or collecting debts or enforcing any rights in property securing the debts.

     (9) Transacting any business in interstate commerce.

     (10) Conducting an isolated transaction completed within a period of thirty (30) days and

not in the course of a number of repeated transactions of like nature.

     (11) Acting as a general partner of a limited partnership which has filed a certificate of

limited partnership as provided in Section 7-13-8 or has registered with the secretary of state as

provided in Section 7-13-49.

     (12) Acting as a member of a limited liability company which has registered with the

secretary of state as provided in Section 7-16-49.

     (c) Any “other entity”, as defined in Section 7-16-5.1(a), Massachusetts trust or business

trust established by law of any other state, desiring to do business in this state, is deemed to be a

foreign corporation and is required to register under, and comply with the provisions of, this

chapter.

     7-1.2-1402. Powers of foreign corporation. - A foreign corporation which has received

a certificate of authority under this chapter, until a certificate of revocation or of withdrawal has

been issued as provided in this chapter, enjoys the same, but no greater, rights and privileges as a

domestic corporation organized for the purposes stated in the application pursuant to which the

certificate of authority is issued; and, except as otherwise provided in this chapter, is subject to

the same duties, restrictions, penalties, and liabilities now or subsequently imposed upon a

domestic corporation of like character.

     7-1.2-1403. Corporate name of foreign corporation. --The secretary of state shall not

issue a certificate of authority or amended certificate of authority to a foreign corporation unless

the corporate name of the corporation:

     (a) Contains the word “corporation,” “company,” “incorporated,” or “limited,” or

contains an abbreviation of one of these words, or the corporation, for use in this state, adds at the

end of its name one of the words or an abbreviation of the word.

     (b) Does not contain any word or phrase which indicates or implies that it is organized for

any purpose other than one or more of the purposes contained in its articles or certificate of

incorporation or that it is authorized or empowered to conduct the business of any types

prohibited by Section 7-1.2-301.

     (c) Is not be the same as, or deceptively similar to, the name of any entity on file with the

secretary of state or a name the exclusive right to which is, at the time, filed, reserved or

registered in the manner provided in this title, subject to the following:

     (1) This provision does not apply if the foreign corporation applying for a certificate of

authority files with the secretary of state any one of the following:

     (i) A fictitious business name statement pursuant to Section 7-1.2-402; or

     (ii) A certified copy of a final decree of a court of competent jurisdiction establishing the

prior right of the foreign corporation to the use of the name in this state; and

     (2) The name may be the same as the name of a corporation or other association, the

articles of incorporation or organization of which has been revoked by the secretary of state and

the revocation has not been withdrawn within one year from the date of the revocation.

     7-1.2-1404. Change of name by foreign corporation. -- Whenever a foreign

corporation which is authorized to transact business in this state changes its name to one that does

not satisfy the requirements of Section 7-1.2-1403, it may not transact business in this state under

the changed name until it adopts a name satisfying the requirements of section 7-1.2-1403 and

obtains an amended certificate of authority under section 7-1.2-1406.

     7-1.2-1405. Application for certificate of authority. - In order to procure a certificate of

authority to transact business in this state, a foreign corporation must make application for the

certificate of authority to the secretary of state, which application includes:

     (a) The name of the corporation and the state or country under the laws of which it is

incorporated.

     (b) The name which the corporation elects to use in this state in accordance with 7-1.2-

1403.

     (c) The date of incorporation and the period of duration of the corporation.

     (d) The address of the principal office of the corporation in the state or country under the

laws of which it is incorporated.

     (e) The name and address of its proposed registered agent in this state at the address.

     (f) The purpose or purposes of the corporation which it proposes to pursue in the

transaction of business in this state.

     (g) The names and respective addresses of the directors of the corporation if the state or

country under the laws of which it was incorporated requires that it have directors and if it does

and need not, then the names and respective addresses of its principal officers.

     (h) A statement of the aggregate number of shares which the corporation has authority to

issue, itemized by classes, par value of shares, shares without par value, and series, if any, within

a class.

     (i) An estimate, expressed as a percentage, of the proportion that the estimated value of

the property of the corporation to be located within this state during the following year bears to

the value of all property of the corporation to be owned during the following year, wherever

located, and an estimate, expressed as a percentage, of the proportion that the gross amount of

business to be transacted by the corporation at or from places of business in this state during the

following year bears to the gross amount which will be transacted by the corporation during the

following year.

     7-1.2-1406. Filing of application for certificate of authority. - (a) A foreign

corporation must deliver the application for a certificate of authority to the secretary of state,

together with a certificate of good standing issued by the proper officer of the state or country

under the laws of which it is incorporated.

     (b) If the secretary of state finds that the application conforms to law, the secretary of

state shall, when all fees have been paid:

     (1) Endorse on the original of the application the word “Filed,” and the month, day, and

year of the filing.

     (2) File in his office the original of the application and a certificate of good standing

issued by the proper officer of the state or country under the laws of which it is incorporated.

     (3) Issue a certificate of authority to transact business in this state.

     (c) The secretary of state shall deliver the certificate of authority to the corporation or its

representative.

     7-1.2-1407. Effect of certificate of authority. -- Upon the issuance of a certificate of

authority by the secretary of state, the corporation is authorized to transact business in this state

for the purposes stated in its application, subject, however, to the right of this state to suspend or

to revoke the authority as provided in this chapter.

     7-1.2-1408. Registered office and registered agent of foreign corporation. - (a) Each

foreign corporation authorized to transact business in this state must have and continuously

maintain in this state a registered agent, who is either:

     (1) An individual resident in this state; or

     (2) Corporation, limited partnership, limited liability company, and in each case either

domestic or one authorized to transact business in this state.

     (b) Foreign corporations who are the holders of mortgages on real estate located within

this state which do not maintain the loan documentation and records within the state shall

authorize the registered agent to accept mortgage discharge payment and to issue a discharge of

the mortgages upon the payment.

     7-1.2-1409. Change of registered office or registered agent of foreign corporation. -

(a) A foreign corporation authorized to transact business in this state may change its registered

office or change its registered agent, or both, upon filing in the office of the secretary of state a

statement stating:

     (1) The name of the corporation.

     (2) The address of its then registered office.

     (3) If the address of its registered office is changed, the address to which the registered

office is to be changed.

     (4) The name of its then registered agent.

     (5) If its registered agent is changed, the name of its successor registered agent.

     (6) The address of its registered office and the address of the business office of its

registered agent, as changed.

     (b) The statement must be executed by an authorized representative of the corporation

and delivered to the secretary of state. If the secretary of state finds that the statement conforms

to the provisions of this chapter, the secretary of state shall file the statement in his office, and

upon the filing, the change of address of the registered office, or the appointment of a new

registered agent, or both, becomes effective.

     (c) Any registered agent of a foreign corporation may resign as the agent upon filing a

written notice of resignation with the secretary of state, who shall immediately mail a copy of the

notice to the corporation at its principal office in the state or country under the laws of which it is

incorporated. The appointment of the agent terminates upon the expiration of thirty (30) days

after receipt of the notice by the secretary of state.

     (d) If a registered agent changes his or its business address to another place within the

state, he or it may change the address and the address of the registered office of any corporations

of which he or it is registered agent by filing a statement as required above except that it must be

signed only by the registered agent, need not be responsive to subsection (a)(5), and must recite

that a copy of the statement has been mailed to each corporation.

     7-1.2-1410. Service of process on foreign corporation. - (a) The registered agent

appointed by a foreign corporation authorized to transact business in this state is an agent of the

corporation upon whom any process, notice, or demand required or permitted by law to be served

upon the corporation may be served.

     (b) Whenever a foreign corporation authorized to transact business in this state fails to

appoint or maintain a registered agent in this state, or whenever any registered agent cannot with

reasonable diligence be found at the registered office, or whenever the certificate of authority of a

foreign corporation is suspended or revoked, the secretary of state is an agent of the corporation

upon whom any process, notice, or demand may be served. Service on the secretary of state of

any process, notice, or demand must be made by delivering to and leaving with him, or with any

clerk having charge of the corporation department of his office, duplicate copies of the process,

notice, or demand. In the event any process, notice, or demand is served on the secretary of state,

the secretary of state shall immediately forward one of the copies by registered mail, addressed to

the corporation at its principal office if known to him, in the state or country under the laws of

which it is incorporated. Any service had in this manner on the secretary of state is returnable in

not less than thirty (30) days.

     (c) Every foreign corporation as a condition precedent to carrying on business in this state

must, and by so carrying on business in this state does, consent that any process, including the

process of garnishment, may be served upon the secretary of state in the manner provided by this

section, except that notice of the service must be given by the plaintiff or his attorney in the

manner as the court in which the action is commenced or pending orders as affording the

corporation reasonable opportunity to defend the action or to learn of the garnishment.

Notwithstanding the preceding requirements, however, once service has been made on the

secretary of state as provided, the court has the authority in the event of failure to comply with the

requirement of notice to the foreign corporation to order notice that is sufficient to apprise it of

the pendency of the action against it, and additionally, may extend the time for answering by the

foreign corporation.

     (d) The secretary of state shall keep a record of all processes, notices, and demands

served upon him under this section, and record in the record the time of the service and his action

on it.

     (e) Nothing contained in these provisions limits or affects the right to serve any process,

notice, or demand, required or permitted by law to be served upon a corporation in any manner

now or subsequently permitted by law.

     7-1.2-1411. Amended certificate of authority. -- (a) A foreign corporation authorized to

transact business in this state shall make application for and procure an amended certificate of

authority if it changes its corporate name, increases its number of authorized shares, or desires to

pursue in this state other or additional purposes than those stated in its prior application for a

certificate of authority.

     (b) The requirements in respect to the form and contents of the application, the manner of

its execution, the filing of the application with the secretary of state, the issuance of an amended

certificate of authority, and the effect of it, is the same as in the case of an original application for

a certificate of authority.

     7-1.2-1412. Withdrawal of foreign corporation. - (a) A foreign corporation authorized

to transact business in this state may withdraw from this state upon procuring from the secretary

of state a certificate of withdrawal. To procure a certificate of withdrawal, the foreign corporation

must deliver to the secretary of state an application for withdrawal, stating:

     (1) The name of the corporation and the state or country under the laws of which it is

incorporated.

     (2) That the corporation is not transacting business in this state.

     (3) That the corporation surrenders its authority to transact business in this state.

     (4) That the corporation revokes the authority of its registered agent in this state to accept

service of process and consents that service of process in any action, suit, or proceeding based

upon any cause of action arising in this state during the time the corporation was authorized to

transact business in this state may subsequently be made on the corporation by service on the

secretary of state.

     (5) The post office address to which the secretary of state may mail a copy of any process

against the corporation that is served on the secretary of state.

     (b) If the corporation is in the hands of a receiver or trustee, the application for

withdrawal must be executed on behalf of the corporation by the receiver or trustee.

     7-1.2-1413. Filing of application for withdrawal. - (a) An original application for

withdrawal must be delivered to the secretary of state. If the secretary of state finds that the

application conforms to the provisions of this chapter, the secretary of state shall, when all fees

and taxes have been paid:

     (1) Endorse on the original the word “Filed,” and the month, day, and year of the filing.

     (2) File the original in his office.

     (3) Issue a certificate of withdrawal.

     (b) The secretary of state shall deliver the certificate of withdrawal to the corporation or

its representative. Upon the issuance of the certificate of withdrawal, the authority of the

corporation to transact business in this state ceases.

     7-1.2-1414. Revocation of certificate of authority. -- (a) The certificate of authority of a

foreign corporation to transact business in this state may be revoked by the secretary of state

under the conditions prescribed in this section when:

     (1) The corporation fails to file its annual report within the time required by this chapter,

or fails to pay any fees, when they become due and payable; or

     (2) The corporation fails to appoint and maintain a registered agent in this state as

required by this chapter; or

     (3) The corporation fails, after changing its registered office or registered agent, to file in

the office of the secretary of state a statement of the change as required by this chapter; or

     (4) The corporation fails to file in the office of the secretary of state any amendment to its

articles of incorporation or any articles of merger within the time prescribed by this chapter; or

     (5) A misrepresentation has been made of any material matter in any application, report,

affidavit, or other document submitted by the corporation pursuant to this chapter.

     (b) No certificate of authority of a foreign corporation may be revoked by the secretary of

state unless the secretary of state has given the corporation not less than sixty (60) days notice

thereof by regular mail addressed to the registered agent of the corporation in this state on file

with the secretary of state’s office; provided, however, that if a prior mailing addressed to the

registered office of the corporation in this state currently on file with the secretary of state’s office

has been returned to the secretary of state as undeliverable by the United States Postal Service for

any reason, or if the revocation notice is returned as undeliverable to the secretary of state’s office

by the United States Postal Service for any reason, the secretary of state shall give notice as

follows:

     (1) To the corporation at its principal office of record as shown in its most recent annual

report, and no further notice is required; or

     (2) In the case of a foreign corporation which has not yet filed an annual report, then to

the corporation at its principal office shown in its application for certificate of authority, and no

further notice is required.

     7-1.2-1415. Issuance of certificate of revocation. -- (a) Upon revoking any certificate of

authority, the secretary of state shall:

     (1) Issue a certificate of revocation.

     (2) File the certificate in his office.

     (3) Send to the corporation by regular mail the certificate of revocation, addressed to the

registered office of the corporation in this state on file with the secretary of state’s office;

provided, however, that if a prior mailing addressed to the registered agent of the corporation in

this state currently on file with the secretary of state’s office has been returned to the secretary of

state as undeliverable by the United States Postal Service for any reason, or if the revocation

certificate is returned as undeliverable to the secretary of state’s office by the United States Postal

Service for any reason, the secretary of state shall give notice as follows:

     (i) To the corporation at its principal office of record as shown in its most recent annual

report, and no further notice is required; or

     (ii) In the case of a foreign corporation that has not yet filed an annual report then to the

corporation at its principal office shown in its application for certificate of authority, and no

further notice is required.

     (b) Upon the issuance of the certificate of revocation, the authority of the corporation to

transact business in this state ceases.

     7-1.2-1416. Withdrawal of certificate of revocation. -- (a) Within ten (10) years after

issuing a certificate of revocation as provided in Section 7-1.2-1415, the secretary of state may

withdraw the certificate of revocation and retroactively reinstate the corporation in good standing

as if its certificate of incorporation had not been revoked, except as subsequently provided:

     (1) Upon the filing by the corporation of the documents it had previously failed to file as

set forth in subsections (1) through (4) of section 7-1-2-1414.

     (2) Upon the payment by the corporation of a penalty for each year or part of a year that

has elapsed since the issuance of the certificate of revocation; and

     (3) Upon the filing by the corporation of a certificate of good standing from the Rhode

Island Division of Taxation.

     (b) If, as permitted by the provisions of this title, another corporation, whether business

or nonprofit limited partnership, limited liability partnership or limited liability company, or

domestic or foreign, qualified to transact business in this state, bears or has filed a fictitious

business name statement with respect to or reserved or registered a name which is not the same

as, or deceptively similar to, the name of a corporation with respect to which the certificate of

revocation is proposed to be withdrawn, then the secretary of state shall condition the withdrawal

of the certificate of revocation upon the reinstated corporation's amending its articles of

incorporation or otherwise complying with the provisions of this chapter with respect to the use

of a name available to it under the laws of this state so as to designate a name which is not the

same as, or deceptively similar to, its former name.

     (c) Upon the withdrawal of the certificate of revocation and reinstatement of the

corporation in good standing as provided in subsection (a), title to any real estate, or any interest

in real estate, held by the corporation at the time of the issuance of the certificate of revocation

and not conveyed subsequent to the revocation of its certificate of incorporation shall be deemed

to be revested in the corporation without further act or deed.

     7-1.2-1417. Application to corporations previously authorized to transact business in

this state. - Foreign corporations which are authorized to transact business in this state as of May

14, 1969, for a purpose or purposes for which a corporation might secure authority under this

chapter, are, subject to the limitations stated in their certificates of authority, entitled to all the

rights and privileges applicable to foreign corporations procuring certificates of authority to

transact business in this state under this chapter, and as of May 14, 1969 the corporations are

subject to all the limitations, restrictions, liabilities, and duties prescribed in these provisions for

foreign corporations procuring certificates of authority to transact business in this state under this

chapter.

     7-1.2-1418. Transacting business without certificate of authority. - (a) No foreign

corporation transacting business in this state without a certificate of authority is permitted to

maintain any action, suit, or proceeding in any court of this state, until the corporation has

obtained a certificate of authority. Nor may any action, suit, or proceeding be maintained in any

court of this state by any successor or assignee of the corporation on any right, claim, or demand

arising out of the transaction of business by the corporation in this state, until a certificate of

authority has been obtained by the corporation or by its successor.

     (b) The failure of a foreign corporation to obtain a certificate of authority to transact

business in this state does not impair the validity of any contract or act of the corporation, and

does not prevent the corporation from defending any action, suit, or proceeding in any court of

this state.

     (c) A foreign corporation which transacts business in this state without a certificate of

authority is liable to this state, for the years or parts of years during which it transacted business

in this state without a certificate of authority, in an amount equal to all fees and franchise taxes

which would have been imposed upon the corporation had it duly applied for and received a

certificate of authority to transact business in this state as required by this chapter and

subsequently filed all reports required by this chapter, plus all penalties imposed by this chapter

for failure to pay the fees and franchise taxes. The attorney general may bring proceedings to

recover all amounts due this state under the provisions of this section.

     (d) The Superior Court has jurisdiction to enjoin any foreign corporation, or any agent of

a foreign corporation, from transacting any business in this state if the corporation fails to comply

with any section of this chapter applicable to it or if the corporation secured a certificate of the

secretary of state under Sections 7-1.2-1405 and 7-1.2-1406 on the basis of false or misleading

representations. The attorney general may, upon motion or upon the relation of proper parties,

proceed for this purpose by complaint in any county in which the corporation is doing business.

     Part XV. Reports and Records.

     7-1.2-1501. Annual reports of domestic and foreign corporations. -- (a) Each

domestic corporation, and each foreign corporation authorized to transact business in this state,

shall file, within the time prescribed by this chapter, an annual report stating:

     (1) The name of the corporation and the state or country under the laws of which it is

incorporated;

     (2) A brief statement of the character of the business in which the corporation is actually

engaged in this state;

     (3) The names and respective addresses of the directors and officers of the corporation;

     (4) A statement of the aggregate number of shares which the corporation has authority to

issue, itemized by classes, par value of shares, if any, and series, if any, within a class;

     (5) A statement of the aggregate number of issued shares, itemized by classes, par value

of shares, if any, and series, if any, within a class;

     (6) Any additional information that is required by the secretary of state.

     (b) The annual report must be made on forms prescribed and furnished by the secretary of

state, and the information contained therein must be given as of the date of the execution of the

report. It must be executed on behalf of the corporation by its authorized representative, or, if the

corporation is in the hands of a receiver or trustee, it must be executed on behalf of the

corporation by the receiver or trustee.

     (c) The annual report of a domestic or foreign corporation must be delivered to the

secretary of state between January 1 and the March 1 of each year, except that the first annual

report of a domestic or foreign corporation must be filed between January 1 and March 1 of the

year following the calendar year in which its articles of incorporation were filed with or its

certificate of authority was issued by the secretary of state. Proof to the satisfaction of the

secretary of state that prior to March 1 the report was deposited in the United States mail in a

sealed envelope, properly addressed, with postage prepaid, is deemed to be a compliance with

this requirement.

     (d) If the secretary of state finds that the annual report conforms to the requirements of

this chapter, the secretary of state shall file the report. If the secretary of state finds that it does

not conform, the secretary of state shall promptly return the report to the corporation for any

necessary corrections, in which event the penalties subsequently prescribed for failure to file the

report within the time previously provided do not apply if the report is corrected to conform to the

requirements of this chapter and returned to the secretary of state within thirty (30) days from the

date on which it was mailed to the corporation by the secretary of state.

     (e) Each corporation, domestic or foreign, that fails or refuses to file its annual report for

any year within thirty days after the time prescribed by this chapter is subject to a penalty of

twenty-five dollars ($25) per year.

     7-1.2-1502. Books and records. - (a) Each corporation shall keep correct and complete

books and records of account, keep minutes of the proceedings of its shareholders and of the

board of directors and committees of the board, and shall also keep at its registered office or

principal place of business, legal counsel’s office, or at the office of its transfer agent or registrar,

a record of its shareholders giving the names and addresses of all shareholders and the number

and class of the shares held by each. Any books, records, and minutes may be in written form or

any other form capable of being converted into written form within a reasonable time.

     (b) Any director, shareholder or holder of voting trust certificates for shares of a

corporation, upon written demand stating the purpose for the demand, has the right to examine, in

person, or by agent or attorney, at any reasonable time or times, for any proper purpose, its

relevant books and records of account, minutes, and record of shareholders and to make extracts

from those books and records of account, minutes, and record of shareholders.

     (c) Any officer or agent who, or a corporation which, refuses to allow any shareholder or

holder of voting trust certificates, or his agent or attorney, to examine and make extracts from its

books and records of account, minutes, and record of shareholders, for any proper purpose, is

liable to the shareholder or holder of voting trust certificates in a penalty of ten percent (10%) of

the value of the shares owned by the shareholder, or in respect of which the voting trust

certificates are issued, in addition to any other damages or remedy afforded him by law. It is a

defense to any action for penalties under this section that the person bringing the suit has within

two (2) years sold or offered for sale any list of shareholders or of holders of voting trust

certificates for shares of the corporation or any other corporation or has aided or abetted any

person in procuring any list of shareholders or of holders of voting trust certificates for that

purpose, or has improperly used any information secured through any prior examination of the

books and records of account, or minutes, or record of shareholders, or of holders of voting trust

certificates for shares of the corporation or any other corporation, or was not acting in good faith

or for a proper purpose in making his demand.

     (d) Nothing contained in these provisions impairs the power of any court of competent

jurisdiction, upon proof by a director, shareholder or holder of voting trust certificates of proper

purpose, to compel the production for examination by the director, shareholder or holder of

voting trust certificates of the books and records of account, minutes, and record of shareholders

of a corporation.

     (e) Upon the written request of any director, shareholder or holder of voting trust

certificates for shares of a corporation, the corporation shall mail to the director, shareholder or

holder of voting trust certificates its most recent financial statements showing in reasonable detail

its assets and liabilities and the results of its operations.

     Part XVI. The Secretary of State and Fees.

     7-1.2-1601. The secretary of state. - (a) The secretary of state has the reasonably

necessary power and authority to enable him to administer this chapter efficiently and to perform

the duties imposed upon the secretary by this chapter.

     (b) The secretary of state shall charge and collect in accordance with the provisions of

this chapter:

     (1) Fees for filing documents and issuing certificates.

     (2) Miscellaneous charges.

     (3) License fees.

     (c) The secretary of state shall, between the first and fifteenth day of each month, make

an itemized return, in writing, to the state controller of the amount of all fees and charges

collected by him in the prior month, and pay to the general treasurer all of the state moneys in his

hands.

     (d) All reports required by this chapter to be filed in the office of the secretary of state

must be made on forms which are prescribed and furnished by the secretary of state. Forms for

all other documents to be filed in the office of the secretary of state may be furnished by the

secretary of state on request for the forms, but the use of the forms, unless otherwise specifically

prescribed in this chapter, is not mandatory.

     (e)(1) If the secretary of state fails to approve any articles of incorporation, amendment,

merger, or dissolution, or any other document required by this chapter to be approved by the

secretary of state before the document is filed in his office, the secretary of state shall, within ten

(10) days after the delivery of the document to the secretary of state, give written notice of

disapproval to the person or corporation, domestic or foreign, delivering the document, specifying

the reasons for the disapproval. From the disapproval the person or corporation may appeal to

the superior court of the county in which the registered office of the corporation is, or is proposed

to be, situated by filing with the clerk of the court a petition setting forth a copy of the articles or

other document sought to be filed and a copy of the written disapproval of the document by the

secretary of state; at which time the matter may be tried de novo by the court, and the court shall

either sustain the action of the secretary of state or direct the secretary to take any action that the

court deems proper.

     (2) If the secretary of state revokes the certificate of authority to transact business in this

state of any foreign corporation pursuant to the provisions of Sections 7-1.2-1414 and 7-1.2-1415,

in addition to the remedy provided in Section 7-1.2-1416, the foreign corporation may likewise

appeal to the superior court of the county where the registered office of the corporation in this

state is situated, by filing with the clerk of the court a petition setting forth a copy of its certificate

of authority to transact business in this state and a copy of the notice of revocation given by the

secretary of state; at that time the matter may be tried de novo by the court, and the court shall

either sustain the action of the secretary of state or direct the secretary to take any action that the

court deems proper.

     (3) Appeals from all final orders and judgments entered by the superior court under this

section in review of any ruling or decision of the secretary of state may be taken as in other civil

actions.

     7-1.2-1602. Fees and charges payable to the secretary of state upon filing, certifying

or copying of papers. - (a) The secretary of state shall charge and collect for filing:

     (1) Articles of incorporation and issuing a certificate of incorporation, seventy dollars

($70.00).

     (2) Articles of amendment and issuing a certificate of amendment, fifty dollars ($50.00).

     (3) Restated articles of incorporation, seventy dollars ($70.00)

     (4) Articles of merger or consolidation and issuing a certificate of merger or

consolidation,

     one hundred dollars ($100).

     (5) An application to reserve a corporate name, fifty dollars ($50.00)

     .(6) A notice of transfer of a reserved corporate name, fifty dollars ($50.00).

     (7) (i) Filing a statement of change of registered agent and registered office or filing a

statement of change of registered agent, twenty dollars ($20.00).

     (ii) Filing a statement of change of registered office only, without fee.

     (8) A statement of the establishment of a series of shares, ten dollars ($10.00).

     (9) A statement of cancellation of shares, ten dollars ($10.00).

     (10) A statement of reduction of stated capital, ten dollars ($10.00).

     (11) A statement of intent to dissolve, without fee.(12) A statement of revocation of

     voluntary dissolution proceedings, ten dollars ($10.00).

     (13) Articles of dissolution, fifty dollars ($50.00).

     (14) An application of a foreign corporation for a certificate of authority to transact

business in this state and issuing a certificate of authority, one hundred fifty dollars ($150).

     (15) An application of a foreign corporation for an amended certificate of authority to

transact business in this state and issuing an amended certificate of authority, seventy-five dollars

($75.00).

     (16) A copy of an amendment to the articles of incorporation of a foreign corporation

holding a certificate of authority to transact business in this state, fifty dollars ($50.00).

     (17) A copy of articles of merger of a foreign corporation holding a certificate of

authority to

     (18) An application for withdrawal of a foreign corporation and issuing a certificate of

withdrawal, fifty dollars ($50.00).

     (19) An annual report, fifty dollars ($50).

     (20) Registered name application, fifty dollars ($50).

     (21) Certificate of good standing/letter of status, twenty dollars ($20).

     (22) Certificate of fact, thirty dollars ($30).

     (23) Any other statement or report, except an annual report, of a domestic or foreign

corporation, ten dollars ($10.00).

      (b) The secretary of state shall charge and collect:

     (1) To withdraw the certificate of revocation or a corporation, whether domestic or

foreign, a penalty in the amount of $50.00 for each year or part of a year that has elapsed since

the issuance of the certificate of revocation.

     (2) For furnishing a certified copy of any document, instrument, or paper relating to a

corporation, fifteen cents $.15/page and $10.00 for the certificate and affixing the seal to it.

     (3) At the time of any service of process on him as resident agent of a corporation,

$15.00, which amount may be recovered as taxable costs by the party to the suit or action making

the service if the party prevails in the suit or action.

     (c)(1) The secretary of state shall charge and collect from each domestic corporation

license fees, based on the number of shares which it has authority to issue or the increase in the

number of shares which it has authority to issue, at the time of:

     (i) Filing articles of incorporation;

     (ii) Filing articles of amendment increasing the number of authorized shares; and

     (iii) Filing articles of merger increasing the number of authorized shares which the

surviving or new corporation, if a domestic corporation, has the authority to issue above the

aggregate number of shares which the constituent domestic corporations and constituent foreign

corporations authorized to transact business in this state had authority to issue.

     (2) The license fees charged to a domestic corporation are as follows: (i) one hundred

sixty dollars ($160) for less than seventy-five million (75,000,000) authorized shares and (ii) one-

fifth (1/5) cent per share of each authorized share for 75,000,000 shares or greater.

     (3) The above license fee calculations also apply when a corporation files an amendment

or merger showing an increase in authorized shares.

     (d)(1) The secretary of state shall charge and collect from each foreign corporation

license fees at the time of:

     (i) Filing an application for a certificate of authority to transact business in this state;

     (ii) Filing articles of amendment which increased the number of authorized shares; and

     (iii) Filing articles of merger which increased the number of authorized shares which the

surviving or new corporation, if a foreign corporation, has authority to issue above the aggregate

number of shares which the constituent domestic corporations and constituent foreign

corporations authorized to transact business in this state had authority to issue.

     (2) The license fees charged to a foreign corporation are as follows: (i) $160 for less than

seventy-five million (75,000,000) authorized shares represented in the State of Rhode Island and

(ii) one-fifth (1/5) cent per share of each authorized share for 75,000,000 shares or greater.

     (3) The above license fee calculations also apply when a corporation files an amendment

or merger showing an increase in authorized shares.

     (4) The number of authorized shares represented in this state is that proportion of its total

authorized shares which the sum of the value of its property located in this state and the gross

amount of business transacted by it at or from places of business in this state bears to the sum of

the value of all of its property, wherever located, and the gross amount of its business, wherever

transacted. The proportion is determined from information contained in the application for a

certificate of authority to transact business in this state or in the application for an amended

certificate of authority to transact business in this state.

     7-1.2-1603. Penalties imposed upon officers and directors. - Any individual who signs

any articles, statement, report, application, or other document intended to be filed with the

secretary of state that is known to the individual to be false in any material respect, is guilty of a

misdemeanor, and upon conviction of it may be fined in any amount not exceeding five hundred

dollars ($500). For purposes of this chapter, a document is signed whether by any manual,

facsimile or electronic signature.

     7-1.2-1604. Interrogatories. -- (a) The secretary of state may propound to any domestic

or foreign corporation subject to the provisions of this chapter, and to any of its officers or

directors, any interrogatories that may be reasonably necessary and proper to enable the secretary

of state to ascertain whether the corporation has complied with all the applicable provisions of

this chapter. The interrogatories must be answered within thirty (30) days after their mailing, or

within any additional time that is fixed by the secretary of state, and the answers to the

interrogatories must be full and complete and made in writing and under oath. If the

interrogatories are directed to an individual they must be answered by him, and if directed to a

corporation they must be answered by the president, vice president, secretary, or assistant

secretary of the corporation. The secretary of state need not file any document to which the

interrogatories relate until the interrogatories are answered as provided in these provisions, and

not then if the interrogatory answers disclose that the document is not in conformity with the

provisions of this chapter. The secretary of state shall certify to the attorney general, for any

action that the attorney general deems appropriate, all interrogatories and their answers which

disclose a violation of any of the provisions of this chapter.

     (b) Each corporation, domestic or foreign, that fails or refuses to answer truthfully and

fully within the time prescribed by this chapter interrogatories propounded by the secretary of

state, in accordance with the provisions of this chapter, is guilty of a misdemeanor and upon

conviction of it may be fined in any amount not exceeding five hundred dollars ($500).

     (c) Interrogatories propounded by the secretary of state and the answers to the

interrogatories are not open to public inspection nor may the secretary of state disclose any facts

or information obtained from them except insofar as the secretary’s official duty requires the facts

or information to be made public or in the event the interrogatories or their answers are required

for evidence in any criminal proceedings or in any other action by this state.

     7-1.2-1605. Certificates and certain copies to be received in evidence. -- All

certificates issued by the secretary of state in accordance with the provisions of this chapter, and

all copies of documents filed in his office in accordance with the provisions of this chapter when

certified by the secretary, is prima facie evidence of the facts stated in them. A certificate by the

secretary of state under the great seal of this state, as to the existence or nonexistence of the facts

relating to corporations is prima facie evidence of the existence or nonexistence of the facts stated

in them.

     Part XVII. Close corporations.

     7‑1.2‑1701. Close corporations. -- (a) Provisions of the articles of incorporation or

bylaws of a corporation organized under this chapter, or provisions of an agreement relating to a

corporation, which would otherwise be invalid because they:

     (1) Restrict, or assign to one or more shareholders or other individuals, any or all of the

powers normally vested in the board of directors or provide that there is no board of directors; or

     (2) Grant the right to one or more shareholders to dissolve the corporation at will or on

the occurrence of a specified contingency; or

     (3) Impose too great a restraint on the transfer of shares of the corporation; are

nevertheless valid if the provisions have been approved by all the shareholders of the corporation

and if the corporation’s original or amended articles of incorporation contain a heading

immediately after the name of the corporation stating that it is a close corporation pursuant to

Section 7‑1.2‑1701. This subsection does not invalidate any provision in articles of incorporation,

bylaws, or agreements that would otherwse be valid.

     (b) The provisions of Section 7‑1.2‑709 limiting the duration of a voting trust or

shareholders’ agreement to ten (10) years is not be applicable to a close corporation that complies

with subsection (a). If close corporation status is terminated pursuant to subsection (d), the

effective term of voting trust or shareholders’ agreement is ten (10) years from the termination or

the term provided therein, whichever is shorter.

     (c) The effect of any provision authorized by subsection (a)(1) is to relieve the directors

and to impose on the individual or individuals undertaking to exercise responsibility the liability

for managerial acts or omissions that would otherwise be imposed on directors to the extent that

and so long as the discretion or powers of the board in its management of corporate affairs is

controlled by any such provision. Action which is valid pursuant to subsection (a)(1) is deemed to

be action by the board of directors for purposes of compliance with any provision of this chapter

providing for action by the board of directors.

     (d) If a close corporation’s original or amended articles of incorporation so provide, the

corporation need not hold an annual meeting of shareholders unless one or more shareholders

deliver written notice to the corporation requesting a meeting at least thirty (30) days before the

meeting date stated or fixed in accordance with the bylaws of the corporation.

     (e)(1) The articles of incorporation must be amended to terminate close corporation status

pursuant to this section if:

     (i) All of the shareholders, or such lessor number as may be specified in the articles of

incorporation, the bylaws, or an agreement relating to the corporation, approve the termination; or

     (ii) There are more than thirty (30) shareholders of record and any shareholder, after

thirty (30) days’ notice to the corporation of his intention to do so during which time the number

is not reduced to thirty (30) or less, demands termination; or

     (iii) Any individual who acquires of record shares of the corporation without notice or

knowledge of its close corporation status demands termination; provided, that notice shall be

conclusively presumed if certificates representing the shares so acquired state on their face, under

the name of the corporation, that it is a close corporation pursuant to this section.

     (2) If the directors and shareholders fail to effect the amendment promptly, the superior

court shall have jurisdiction to enter whatever order is necessary to effect the amendment. The

termination shall not affect the validity of any provision relating to the corporation or its

management which would be valid, notwithstanding the provisions of this section.

     Part XVIII. Miscellaneous.

     7-1.2-1801. Unauthorized assumption of corporate powers. -- All individuals who

assume to act as a corporation without authority so to do are jointly and severally liable for all

debts and liabilities incurred or arising as a result of that action.

     7-1.2-1802. Application to existing corporations organized under general acts. -- The

provisions of this chapter apply to all existing corporations organized under any general act of

this state providing for the organization of corporations for a purpose or purposes for which a

corporation might be organized under this chapter, where the power has been reserved to amend,

repeal, or modify the act under which the corporation was organized and where the act is repealed

by this chapter.

     7-1.2-1803. Application to foreign and interstate commerce. -- The provisions of this

chapter apply to commerce with foreign nations and among the several states only insofar as the

provisions are permitted under the constitution of the United States.

     7-1.2-1804. Applicability to corporations created by special acts. -- The provisions of

this chapter apply to all existing corporations previously or subsequently created by any special

act of the general assembly of a kind that could be organized under this chapter, except insofar as

the provisions are inconsistent with the provisions of any applicable special act passed after May

5, 1920 or with the provisions of any applicable special act passed that are not subject to

amendment or repeal at the will of the general assembly. A corporation created by special act of

the kind that could be organized under this chapter but whose charter is not subject to

amendment, repeal, or modification by the general assembly, may at a called meeting for the

purpose, by a unanimous vote of its shareholders or members, adopt the provisions of this chapter

upon the filing in the office of the secretary of state of a certified copy of the vote, attested by its

president or vice president and its secretary or assistant secretary under its corporate seal, and the

payment to the secretary of state of the fee prescribed by Section 7-1.2-1602. The corporation is

subsequently governed in all respects by the provisions of this chapter and its charter shall

subsequently be subject to amendment or repeal at the will of the general assembly.

     SECTION 3. This act shall take effect on July 1, 2005.

          

          

     

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LC01122/SUB A

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