Guam § 281414 - Election to Purchase in Lieu of Dissolution.

§ 281414. Election to Purchase in Lieu of Dissolution.

(a) In a proceeding under § 281410 (b) to dissolve a corporation that

has no shares listed on a national securities exchange or regularly traded in a

market maintained by one or more members of a national or affiliated

securities association, the corporation may elect or, if it fails to elect, one or

more shareholders may elect to purchase all shares owned by the petitioning

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shareholder at the fair value of the shares. An election pursuant to this

section shall be irrevocable unless the court determines that it is equitable to

set aside or modify the election.

(b) An election to purchase pursuant to this section may be filed with

the court at any time within 90 days after the filing of the petition under §

281410 (b) or at such later time as the court in its discretion may allow. If

the election to purchase is filed by one or more shareholders, the corporation

shall, within 10 days thereafter, give written notice to all shareholders, other

than the petitioner. The notice must state the name and number of shares

owned by the petitioner and the name and number of shares owned by each

electing shareholder and must advise the recipients of their right to join in

the election to purchase shares in accordance with this section. Shareholders

who wish to participate must file notice of their intention to join in the

purchase no later than 30 days after the effective date of the notice to them.

All shareholders who have filed an election or notice of their intention to

participate in the election to purchase thereby become parties to the

proceeding and shall participate in the purchase in proportion to their

ownership of shares as of the date the first election was filed, unless they

otherwise agree or the court otherwise directs. After an election has been

filed by the corporation or one or more shareholders, the proceeding under §

281410 (b) may not be discontinued or settled, nor may the petitioning

shareholder sell or otherwise dispose of his shares, unless the court

determines that it would be equitable to the corporation and the shareholders,

other than the petitioner, to permit such discontinuance, settlement, sale, or

other disposition.

(c) If, within 60 days of the filing of the first election, the parties reach

agreement as to the fair value and terms of purchase of the petitioner’s

shares, the court shall enter an order directing the purchase of petitioner’s

shares upon the terms and conditions agreed to by the parties.

(d) If the parties are unable to reach an agreement as provided for in

subsection (c), the court, upon application of any party, shall stay the §

281410 (b) proceedings and determine the fair value of the petitioner’s

shares as of the day before the date on which the petition under § 281410 (b)

was filed or as of such other date as the court deems appropriate under the

circumstances.

(e) Upon determining the fair value of the shares, the court shall enter

an order directing the purchase upon such terms and conditions as the court

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deems appropriate, which may include payment of the purchase price in

installments, where necessary in the interest of equity, provision for security

to assure payment of the purchase price and any additional costs, fees, and

expenses as may have been awarded, and, if the shares are to be purchased

by shareholders, the allocation of shares among them. In allocating

petitioner’s shares among holders of different classes of shares, the court

should attempt to preserve the existing distribution of voting rights among

holders of different classes insofar as practicable and may direct that holders

of a specific class or classes shall not participate in the purchase. Interest

may be allowed at the rate and from the date determined by the court to be

equitable, but if the court finds that the refusal of the petitioning shareholder

to accept an offer of payment was arbitrary or otherwise not in good faith, no

interest shall be allowed. If the court finds that the petitioning shareholder

had probable grounds for relief under paragraphs (2) or (4) of § 281410 (b),

it may award to the petitioning shareholder reasonable fees and expenses of

counsel and of any experts employed by him.

(f) Upon entry of an order under subsections (c) or (e), the court shall

dismiss the petition to dissolve the corporation under § 281410, and the

petitioning shareholder shall no longer have any rights or status as a

shareholder of the corporation, except the right to receive the amounts

awarded to him by the order of the court which shall be enforceable in the

same manner as any other judgment.

(g) The purchase ordered pursuant to subsection (e), shall be made

within 10 days after the date the order becomes final unless before that time

the corporation files with the court a notice of its intention to adopt articles

of dissolution pursuant to sections 281402 and 281403, which articles must

then be adopted and filed within 50 days thereafter. Upon filing of such

articles of dissolution, the corporation shall be dissolved in accordance with

the provisions of § 281405 through 281407, and the order entered pursuant

to subsection (e) shall no longer be of any force or effect, except that the

court may award the petitioning shareholder reasonable fees and expenses in

accordance with the provisions of the last sentence of subsection (e) and the

petitioner may continue to pursue any claims previously asserted on behalf

of the corporation.

(h) Any payment by the corporation pursuant to an order under

subsections (c) or (e), other than an award of fees and expenses pursuant to

subsection (e), is subject to the provisions of § 28616.

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