WARM SPRINGS TRIBAL CODE CHAPTER 702
NON PROFIT CORPORATIONS
Table of Contents
I. GENERAL PROVISIONS
702.002 Filing requirements
702.004 Filing fee
702.006 Effective date of document
702.020 Private foundations
702.032 Articles of incorporation
702.036 Organization of corporation
III. PURPOSES AND POWERS
702.042 General powers
IV. OFFICE AND AGENT
702.050 Registered office and registered agent
702.052 Service on the corporation
V. MEMBERS AND MEMBERSHIPS
702.060 Tribal membership
702.070 Differences in rights and obligations of members
702.072 Member’s liability to third parties
702.074 Creditor’s action against member
702.082 Termination, expulsion or suspension
702.090 Derivative suits
VI. MEMBERSHIP MEETINGS AND VOTING
702.110 Annual and regular meetings
702.112 Special meeting
702.114 Court-ordered meeting
702.115 Action without meeting
702.116 Notice of meeting
702.117 Waiver of notice
702.118 Record date
702.119 Action by written ballot
702.120 Members’ list for meeting
702.122 Voting entitlement of members
702.125 Corporation’s acceptance of votes
702.126 Quorum requirements
702.127 Voting requirements
702.128 Cumulative voting for directors
702.129 Other methods of electing directors
702.130 Voting agreements
VII. DIRECTORS AND OFFICERS
702.140 Requirement for and duties of board
702.141 Number of directors
702.142 Election, designation and appointment of directors
702.143 Terms of directors generally
702.144 Resignation of directors
702.145 Removal of directors elected by members or directors
702.146 Removal of directors by judicial proceeding
702.148 Vacancy on board
702.149 Compensation of directors
702.150 Call and notice of meetings
702.152 Quorum and voting
702.160 General standards for directors
702.162 Director conflict of interest
702.164 Liability for unlawful distributions
702.168 Liability of qualified directors
702.170 Required officers
702.172 Duties and authority of officers
702.174 Standards of conduct for officers
702.176 Resignation and removal of officers
702.180 Authority to indemnify
702.182 Mandatory indemnification
702.184 Court-ordered indemnification
702.186 Determination and authorization of indemnification
702.187 Indemnification of officers, employees and agents
VIII. AMENDMENT OF ARTICLES OF INCORPORATION AND BYLAWS
702.192 Amendment by directors
702.194 Amendment by board of directors and members
702.196 Class voting by members on amendments
702.197 Articles of amendment
702.198 Restated articles of incorporation
702.199 Amendment pursuant to court order
702.200 Amendment by directors
702.202 Amendment by directors and members
702.204 Approval by third persons
IX. SALE OF ASSETS
702.210 Sale of assets in regular course of activities; mortgage of assets
702.212 Sale of assets other than in regular course of activities
702.220 Prohibited distributions
702.222 Authorized distributions
702.230 Dissolution by incorporators
702.232 Dissolution by directors, members and third persons
702.234 Articles of dissolution
702.235 Revocation of dissolution
702.236 Effect of dissolution
702.237 Known claims against dissolved corporation
702.238 Unknown claims against dissolved corporation
702.240 Grounds for administrative dissolution
702.242 Procedure for and effect of administrative dissolution
702.250 Hearings officer
702.252 Grounds for judicial dissolution
702.254 Decree of dissolution
XII. RECORDS AND REPORTS
702.260 Corporate records
702.262 Inspection of records by members
702.264 Court-ordered inspection
702.270 Preservation of exemptions and immunities
702.274 Warm Springs Tribal Court
702.276 Definitions. As used in this chapter
WARM SPRINGS TRIBAL CODE CHAPTER 702
NON PROFIT CORPORATIONS
I. GENERAL PROVISIONS
702.002 Filing requirements. A document must satisfy the requirements of this section, to be entitled to filing by the Secretary-Treasurer. Articles of organization shall be signed by or on behalf of one or more persons wishing to form the corporation. Articles of amendment shall be signed by at least one member.
702.004 Filing fee. The Secretary-Treasurer may establish a schedule of fees for documents filed under this chapter.
702.006 Effective date of document. A document accepted for filing is effective on the date it is filed.
702.008 Forms. Upon request, the Secretary-Treasurer may furnish forms for documents required or permitted to be filed by this chapter. The Secretary-Treasurer may require the use of the forms.
702.20 Private foundations. Except where otherwise determined by a court of competent jurisdiction, a corporation which is a private foundation as defined in section 509 of the Internal Revenue Code of 1986 shall:
- Distribute such amounts for each taxable year at such time and in such manner as not to subject the corporation to tax under section 4942 of the Internal Revenue Code of 1986;
- Not engage in any act of self-dealing as defined in section 4941(d) of the Internal Revenue Code of 1986;
- Not retain any excess business holdings as defined in section 4943(c) of the Internal Revenue Code of 1986;
- Not make any investments in such a manner as to subject the corporation to taxes on investments which jeopardize charitable purposes as provided in section 4944 of the Internal Revenue Code of 1986; and
- Not make any taxable expenditures as defined in section 4945(d) of the Internal Revenue Code of 1986.
702.030 Incorporators. One or more individuals 18 years of age or older, a domestic or foreign corporation, a partnership or an association may act as incorporators of a corporation by delivering articles of incorporation to the office for filing.
702.32. Articles of incorporation.
- The articles of incorporation shall set forth: (a) A corporate name for the corporation (b) One of the following statements or words of similar import: (i) This corporation is a public benefit corporation; (ii) This corporation is a mutual benefit corporation; or (iii) This corporation is a religious corporation; (c) The address, including street and number, of the corporation’s initial registered office and the name of its initial registered agent at that location; (d) The name and address of each incorporator; (e) An alternate corporate mailing address which shall be that of the principal office, to which notices, may be mailed until the principal office of the corporation has been designated by the corporation in its annual report; (f) Whether or not the corporation will have members as that term is defined in this chapter; and (g) Provisions regarding the distribution of assets on dissolution.
- The articles of incorporation may set forth any other provisions, not inconsistent with law, for the regulation of the internal affairs of the corporation, including any provision that is required or permitted to be included in any operating agreement or bylaws of the corporation under this chapter.
702.034. Incorporation. Unless a delayed effective date is specified, the corporate existence begins when the articles of incorporation are filed by the Secretary-Treasurer.
702.36. Organization of corporation.
- After incorporation: (a) 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 carrying on any other business brought before the meeting. (b) If initial directors are not named in the articles, the incorporator or incorporators shall hold an organizational meeting at the call of a majority of the incorporators with equivalent notice to: (i) To complete the organization of the corporation and to elect directors, unless the organization is a corporation sole; or (ii) To elect a board of directors which shall complete the organization of the corporation.
702.038 Bylaws. The incorporators or board of directors of a corporation, whichever completes the organization of the corporation at its organizational meeting, shall adopt initial bylaws for the corporation. The bylaws may contain any provision for managing and regulating the affairs of the corporation that is not inconsistent with law or the articles of incorporation.
III. PURPOSES AND POWERS
702.040. Purposes. Except as otherwise provided by the laws of the Tribe and in this section, every corporation incorporated under this chapter may conduct any lawful business or purpose unless a more limited purpose is set forth in the articles of incorporation.
702.42. General powers.
- Unless its articles of incorporation provide otherwise, every corporation has perpetual duration and succession in its corporate name and has the same powers as an individual to do all things necessary or convenient to carry out its affairs, including, without limitation, power to: (a) Sue and be sued, complain and defend in its corporate name. (b) Have a corporate seal, which may be altered at will, and to use it, or a facsimile of it, by impressing or affixing or reproducing it in any other manner. (c) Make and amend bylaws not inconsistent with its articles of incorporation or with the laws of this Tribe, for regulating and managing the affairs of the corporation. (d) Purchase, take by gift, devise or bequest, receive, lease or otherwise acquire, and own, hold, improve, use and otherwise deal with, real or personal property or any interest in property, wherever located. (e) Sell, convey, mortgage, pledge, lease, exchange, transfer and otherwise dispose of all or any part of its property. (f) Purchase, receive, subscribe for or otherwise acquire, own, hold, vote, use, sell, mortgage, lend, pledge or otherwise dispose of and deal in or with shares or other interests in or obligations of any other entity. (g) Make contracts and guarantees, incur liabilities, borrow money, issue notes, bonds and other obligations, and secure any of its obligations by mortgage or pledge of any of its property, franchises or income. (h) Lend money, invest and reinvest its funds, and receive and hold real and personal property as security for repayment. (i) Be a promoter, partner, member, associate or manager of any partnership, joint venture, trust or other entity. (j) Conduct its activities, locate offices and exercise the powers granted by this chapter within or without this Reservation. (k) Elect or appoint directors, officers, employees, and agents of the corporation, define their duties and fix their compensation, if any. (l) Pay pensions and establish pension plans, pension trusts and other benefit and incentive plans for any or all of its current or former directors, officers, employees and agents. (m) Unless otherwise provided in the articles of incorporation, make donations not inconsistent with law for the public welfare or for charitable, benevolent, religious, scientific or educational purposes and for other purposes that further the corporate interest. (n) Impose dues, assessments, admission and transfer fees upon its members. (o) Establish conditions for admission of members, admit members and issue memberships. (p) Carry on a business. (q) Do any other act, not inconsistent with law, that furthers the activities and affairs of the corporation. (r) Dissolve, merge or reorganize as provided in this chapter.
IV. OFFICE AND AGENT
702.50. Registered office and registered agent. Each corporation shall continuously maintain on the Reservation, both:
- A registered agent, who shall be an individual who resides on the Reservation; a domestic business or nonprofit corporation with an office on the Reservation; or a foreign business or nonprofit corporation authorized to transact business on the Reservation with an office on the Reservation; and
- A registered office of the corporation, which shall be the residence or office address of the registered agent.
702.052 Service on the corporation. The registered agent appointed by the corporation 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. The Secretary-Treasurer may be served if there is no registered agent.
V. MEMBERS AND MEMBERSHIPS
702.060 Tribal membership. At least one member of any corporation organized under this chapter must be a member of the Tribe. In the event the member of the Tribe named in the corporation’s articles of incorporation ceases to be a member of the corporation, the corporation shall immediately amend its articles to set forth another member of the Tribe who is also a member of the corporation. If there is no member of the Tribe who is also a member of the corporation, the corporation shall dissolve as provided in WSTC § 702.230-254.
702.070 Differences in rights and obligations of members. All members shall have the same rights and obligations with respect to voting, dissolution, redemption and transfer, unless the articles or bylaws establish classes of membership with different rights or obligations. All members shall have the same rights and obligations with respect to any other matters, except as set forth in or authorized by the articles or bylaws.
702.072 Member’s liability to third parties. A member of a corporation is not personally liable for the acts, debts, liabilities or obligations of the corporation merely by reason of being a member.
702.074 Creditor’s action against member. No proceeding may be brought by a creditor to reach the liability, if any, of a member to the corporation arising from membership unless final judgment has been rendered in favor of the creditor against the corporation and execution has been returned unsatisfied in whole or in part or unless obtaining such judgment and execution would be useless.
702.080 Resignation. A member may resign at any time; however, the resignation of a member does not relieve the member from any obligations the member may have to the corporation as a result of obligations incurred or commitments made prior to resignation.
702.082 Termination, expulsion or suspension.
- No member of a public benefit or mutual benefit corporation may be expelled or suspended, and no membership or memberships in such corporations may be terminated or suspended except pursuant to a procedure which is fair and reasonable and is carried out in good faith.
- A procedure is fair and reasonable when either: (a) The articles or bylaws set forth a procedure which provides: (i) Not less than 15 days’ prior written notice of the expulsion, suspension or termination and the reasons therefor; and (ii) An opportunity for the member to be heard, orally or in writing, not less than five days before the effective date of the expulsion, suspension or termination by a person or persons authorized to decide that the proposed expulsion, termination or suspension not take place; or (b) It is fair and reasonable taking into consideration all of the relevant facts and circumstances.
- Any written notice given by mail must be given by first class or certified mail sent to the last address of the member shown on the corporation’s records.
- Any proceeding challenging an expulsion, suspension or termination, including a proceeding in which defective notice is alleged, must be commenced within one year after the effective date of the expulsion, suspension or termination.
- A member who has been expelled or suspended, or whose membership has been suspended or terminated, may be liable to the corporation for dues, assessments or fees as a result of obligations incurred by the member prior to expulsion, suspension or termination.
702.90. Derivative suits.
- A proceeding may be brought in the right of a domestic or foreign corporation to procure a judgment in its favor by: (a) Any member or members having two percent or more of the voting power or by 20 members, whichever is less; or (b) Any director.
- In any such proceeding, each member complainant shall have been a member when the transaction complained of occurred.
- A complaint in a proceeding brought in the right of a corporation must allege with particularity the demand made, if any, to obtain action by the board of directors and either that the demand was refused or ignored or why a demand was not made. Whether or not a demand for action was made, if the corporation commences an investigation of the charges made in the demand or complaint, the court may stay any proceeding until the investigation is completed.
- A proceeding commenced under this section 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 interest of the corporation’s members or a class of members, the court shall direct that notice be given the members affected.
VI. MEMBERSHIP MEETINGS AND VOTING
702.110. Annual and regular meetings.
- A corporation with members shall hold a membership meeting annually at a time stated in or fixed in accordance with the bylaws.
- A corporation with members may hold regular membership meetings at the times stated in or fixed in accordance with the bylaws.
- At the annual meeting: the president, and any other officer the board of directors or the president may designate, shall report on the activities and financial condition of the corporation.
- The failure to hold an annual or regular meeting at a time stated in or fixed in accordance with a corporation’s bylaws does not affect the validity of any corporate action.
702.112 Special meeting. A corporation with members shall hold a special meeting of members on call of its board of directors or the person or persons authorized to do so by the articles of incorporation or bylaws; or except as provided in the articles or bylaws, if the holders of at least five percent of the voting power of any corporation sign, date and deliver to the corporation’s secretary one or more written demands for the meeting describing the purpose or purposes for which it is to be held.
702.114 Court-ordered meeting. The Warm Springs Tribal Court may summarily order a meeting to be held on application of any member or other person entitled to participate in an annual or regular meeting or, in the case of a public benefit corporation, the Secretary-Treasurer, if an annual meeting was not held within the earlier of six months after the end of the corporation’s fiscal year or 15 months after its last annual meeting; or on application of any member or other person entitled to participate in a regular meeting or, in the case of a public benefit corporation, the Secretary-Treasurer, if a regular meeting is not held within 40 days after the date it was required to be held.
702.115 Action without meeting. Unless the articles of incorporation or bylaws provide otherwise, action required or permitted by this chapter to be taken at a members’ meeting may be taken without a meeting if the action is taken by all the members entitled to vote on the action. The action must be evidenced by one or more written consents describing the action taken, signed by all the members entitled to vote on the action, and delivered to the corporation for inclusion in the minutes or filing with the corporate records. Action taken under this section is effective when the last member signs the consent, unless the consent specifies an earlier or later effective date.
702.116 Notice of meeting.
- A corporation shall give notice consistent with its bylaws of meetings of members in a fair and reasonable manner. The corporation is required to give notice to members entitled to vote at the meeting and to any other person specified in this chapter, the articles of incorporation or the bylaws.
- Any notice which conforms to the requirements of subsection (3) of this section is fair and reasonable, but other means of giving notice may also be fair and reasonable when all the circumstances are considered.
- Notice is fair and reasonable if: (a) The corporation notifies its members of the place, date and time of each annual, regular and special meeting of members no fewer than seven days, or if notice is mailed by other than first class or registered mail, no fewer than 30 nor more than 60 days before the meeting; (b) Notice of a special meeting includes a description of the purpose or purposes for which the meeting is called.
702.117 Waiver of notice.
- A member may at any time waive any notice required by this chapter, the articles or bylaws. The waiver must be in writing, be signed by the member entitled to the notice and be delivered to the corporation for inclusion in the minutes or filing with the corporate records.
- A member’s attendance at a meeting waives objection to lack of notice or defective notice of the meeting, unless the member at the beginning of the meeting objects to holding the meeting or transacting business at the meeting; and consideration of a particular matter at the meeting that is not within the purpose or purposes described in the meeting notice, unless the member objects to considering the matter when it is presented.
702.118 Record date.
- The bylaws may fix or provide the manner of fixing the record date in order to determine the members entitled to notice of a members’ meeting, to demand a special meeting, to vote or to take any other lawful action. If the bylaws do not fix or provide for fixing such a record date, the board of directors may fix a future date as the record date.
- A record date fixed under this section may not be more than 70 days before the meeting or action requiring the determination of members.
- A determination of members entitled to notice of or to vote at a membership meeting is effective for any adjournment of the meeting unless the board fixes a new record date, which it must do if the meeting is adjourned to a date more than 120 days after the date fixed for the original meeting.
- If a court orders a meeting adjourned to a date more than 120 days after the date fixed for the original meeting, it may provide that the original record date continues in effect or it may fix a new record date.
702.119 Action by written ballot.
- Unless prohibited or limited by the articles or bylaws, any action which may be taken at any annual, regular or special meeting of members may be taken without a meeting if the corporation delivers a written ballot to every member entitled to vote on the matter.
- A written ballot shall: (a) Set forth each proposed action; and (b) Provide an opportunity to vote for or against each proposed action.
- Approval by written ballot pursuant to this section shall be valid only when the number of votes cast by ballot equals or exceeds any quorum required to be present at a meeting authorizing the action, and the number of approvals equals or exceeds the number of votes that would be required to approve the matter at a meeting at which the total number of votes cast was the same as the number of votes cast by ballot.
- All solicitations for votes by written ballot shall: (a) Indicate the number of responses needed to meet the quorum requirements; (b) State the percentage of approvals necessary to approve each matter other than election of directors; and (c) Specify a reasonable time by which a ballot must be received by the corporation in order to be counted.
702.120 Members’ list for meeting.
- A corporation shall prepare an alphabetical list of the names, addresses and membership dates of all its members. If there are classes of members, the list must show the address and number of votes each member is entitled to vote at the meeting. The corporation shall prepare on a current basis through the time of the membership meeting a list of members, if any, who are entitled to vote at the meeting, but are not part of the main list of members.
- The list of members must be available for inspection by any member for the purpose of communication with other members concerning the meeting, beginning two business days after notice of the meeting is given for which the list was prepared and continuing through the meeting, at the corporation’s principal office or at a reasonable place identified in the meeting notice in the city or other location where the meeting will be held. A member, the member’s agent or attorney is entitled, on written demand setting forth a proper purpose, to copy the list at a reasonable time and at the member’s expense, during the period it is available for inspection.
- The corporation shall make the list of members available at the meeting, and any member, the member’s agent or attorney is entitled to inspect the list for any proper purpose at any time during the meeting or any adjournment.
702.122 Voting entitlement of members.
- Unless the articles or bylaws provide otherwise, each member is entitled to one vote on each matter voted on by the members, including each matter on which a member is entitled to vote under this chapter or the articles or bylaws. Except as expressly prohibited in this chapter, the articles or bylaws may provide for different allocations of votes among member classes or exclude the members or some or all member classes from voting on any issue on which they would otherwise be entitled to vote under this chapter. Persons not retaining a right to vote on more than one occasion for the election of a director or directors shall not be deemed members.
- Unless the articles or bylaws provide otherwise, if a membership stands of record in the names of two or more persons, their acts with respect to voting shall have the following effect: (a) If only one votes, such act binds all; and (b) (If more than one votes, the vote shall be divided on a pro rata basis.
- Unless the articles or bylaws prohibit or limit proxy voting, a member may appoint a proxy to vote or otherwise act for the member by signing an appointment form either personally or by the member’s attorney-in-fact.
- An appointment of a proxy is effective when received by the secretary or other officer or agent authorized to tabulate votes. An appointment is valid for 11 months unless a different period is expressly provided in the appointment form.
- An appointment of a proxy is revocable by the member.
- The death or incapacity of the member 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 authority under the appointment.
- Appointment of a proxy is revoked by the person appointing the proxy: (a) Attending any meeting and voting in person; or (b) Signing and delivering to the secretary or other officer or agent authorized to tabulate proxy votes either a writing stating that the appointment of the proxy is revoked or a subsequent appointment form.
702.124 Adjournment. Unless otherwise provided in the articles of incorporation or bylaws, a majority of votes represented at a meeting of members, whether or not a quorum, may adjourn the meeting from time to time to a different time and place without further notice to any member of any adjournment. At the adjourned meeting at which a quorum is present, any business may be transacted that might have been transacted at the meeting originally held.
702.125 Corporation’s acceptance of votes. If the name signed on a vote, consent, waiver or proxy appointment corresponds to the name of a member, the corporation, if acting in good faith, is entitled to accept the vote, consent, waiver or proxy appointment and give it effect as the act of the member.
702.126 Quorum requirements. Unless the articles or bylaws provide for a higher quorum, those votes represented at a meeting of members shall constitute a quorum. An amendment to the articles or bylaws to decrease the quorum for any member action may be approved by the members, or, unless prohibited by the articles or bylaws, by the board. An amendment to the articles or bylaws to increase the quorum required for any member action must be approved by the members.
702.127 Voting requirements. Unless this chapter, the articles or the bylaws require a greater vote or voting by class, if a quorum is present, the affirmative vote of a majority of the votes represented and voting is the act of the members. An amendment to the articles or bylaws to add to, change or delete the vote required for any member action must be approved by the members.
702.128 Cumulative voting for directors.
- If the articles or bylaws provide for cumulative voting by members, members may so vote, by multiplying the number of votes the members are entitled to cast by the number of directors for whom they are entitled to vote, and cast the product for a single candidate or distribute the product among two or more candidates.
- Cumulative voting is not authorized at a particular meeting unless the meeting notice or statement accompanying the notice states that cumulative voting will take place; or a member gives notice during the meeting and before the vote is taken of the member’s intent to cumulate votes, and if one member gives this notice all other members participating in the election are entitled to cumulate their votes without giving further notice.
702.129 Other methods of electing directors. A corporation may provide in its articles or bylaws for election of directors by members or delegates on the basis of chapter or other organizational unit; by region or other geographic unit; by preferential voting; or by any other reasonable method.
702.130 Voting agreements. Two or more members may provide for the manner in which they will vote by signing an agreement for that purpose. Such agreements may be valid for a period of up to 10 years. For public benefit corporations such agreements must have a reasonable purpose not inconsistent with the corporation’s public or charitable purposes.
VII. DIRECTORS AND OFFICERS
702.140 Requirement for and duties of board.
- Each corporation shall have a board of directors.
- All corporate powers shall be exercised by or under the authority of, and the affairs of the corporation managed under the direction of, the board of directors, subject to any limitation set forth in the articles of incorporation and except as provided in subsection (3) of this section.
- The articles of incorporation may authorize a person or persons, or the manner of designating a person or persons, authorized to exercise some or all of the powers which would otherwise be exercised by a board. To the extent so authorized any such person or persons shall have the duties and responsibilities of the directors, and the directors shall be relieved to that extent from such duties and responsibilities.
702.141 Number of directors. A board of directors must consist of one or more individuals for a mutual benefit or religious corporation and three or more individuals for a public benefit corporation, with the number specified or fixed in accordance with the articles of incorporation or bylaws. The articles of incorporation or bylaws may establish a variable range for the size of the board of directors by fixing a minimum and maximum number of directors.
702.142 Election, designation and appointment of directors. If the corporation has members entitled to vote for directors, all the directors, except the initial directors, shall be elected at the first annual meeting of members, and at each annual meeting thereafter, unless the articles or bylaws provide some other time or method of election, or provide that some of the directors are appointed by some other person or are designated.
702.143 Terms of directors generally. The articles or bylaws may specify the terms of directors. Except for designated or appointed directors, the terms of directors may not exceed five years. In the absence of any term specified in the articles or bylaws, the term of each director shall be one year. Directors may be elected for successive terms.
702.144 Resignation of directors. A director may resign at any time by delivering written notice to the board of directors, its presiding officer or to the president or secretary.
702.145 Removal of directors elected by members or directors. The members may remove one or more directors elected by them with or without cause unless the articles of incorporation provide that directors may be removed only for cause.
702.146 Removal of directors by judicial proceeding.
- The Warm Springs Tribal Court may remove any director of the corporation from office in a proceeding commenced either by the corporation, at least 10 percent of the members of any class entitled to vote for directors, or the Secretary-Treasurer in the case of a public benefit corporation if the court finds that: (a) The director engaged in fraudulent or dishonest conduct, or gross abuse of authority or discretion, with respect to the corporation, or the director has violated a duty set forth in WSTC § 702.140 and (b) Removal is in the best interest of the corporation.
702.148 Vacancy on board.
- Unless the articles or bylaws provide otherwise, if a vacancy occurs on a board of directors, including a vacancy resulting from an increase in the number of directors: (a) The members entitled to vote for directors, if any, may fill the vacancy. If the vacant office was held by a director elected by a class, chapter or other organizational unit or by region or other geographic grouping, only members of the class, chapter, unit or grouping are entitled to vote to fill the vacancy if it is filled by the members; (b) The board of directors may fill the vacancy; or (c) If the directors remaining in office constitute fewer than a quorum of the board of directors, they may fill the vacancy by the affirmative vote of a majority of all the directors remaining in office.
702.149 Compensation of directors. Unless the articles or bylaws provide otherwise, the board of directors may fix the compensation of directors.
702.150 Call and notice of meetings.
- Unless the articles, bylaws or this chapter provide otherwise, regular meetings of the board may be held without notice of the date, time, place or purpose of the meeting.
- Unless the articles of incorporation or bylaws provide for a longer or shorter period, special meetings of the board must be preceded by at least two days’ notice to each director of the date, time and place of the meeting. Unless this chapter provides otherwise, the notice need not describe the purposes of the special meeting unless required by the articles of incorporation or bylaws.
- Unless the articles or bylaws provide otherwise, the presiding officer of the board, the president or 20 percent of the directors then in office may call and give notice of a meeting of the board.
702.152. Quorum and voting.
- Unless the articles of incorporation or bylaws require a greater number or a lesser number as authorized under subsection (2) of this section, a quorum of a board of directors consists of: (a) If the corporation has a fixed board size, a majority of the fixed number of directors; or (b) If the corporation has a variable-range size board, a majority of the number of directors prescribed, or if no number is prescribed, a majority of the number in office immediately before the meeting begins.
- The articles of incorporation or bylaws may authorize a quorum of a board of directors to consist of no fewer than one-third of the fixed or prescribed number of directors determined under subsection (1) of this section.
702.154 Committees. Unless the articles or bylaws provide otherwise, a board of directors may create one or more committees of the board of directors which exercise the authority of the board of directors and appoint members of the board to serve on them or designate the method of selecting committee members. Each committee shall consist of two or more directors, who serve at the pleasure of the board of directors.
702.160 General standards for directors.
- A director shall discharge the duties of a director, including the director’s duties as a member of a committee, in good faith, with the care an ordinarily prudent person in a like position would exercise under similar circumstances, and in a manner the director reasonably believes to be in the best interests of the corporation.
- A director is not liable to the corporation, any member or any other person for any action taken or not taken as a director, if the director acted in compliance with this section. The liability of a director for monetary damages to the corporation and its members may be eliminated or limited in the corporation’s articles.
- A director shall not be deemed to be a trustee with respect to the corporation or with respect to any property held or administered by the corporation, including without limit, property that may be subject to restrictions imposed by the donor or transferor of such property.
702.162 Director conflict of interest. A conflict of interest transaction is a transaction with the corporation in which a director of the corporation has a direct or indirect interest. A conflict of interest transaction is not voidable or the basis for imposing liability on the director if the transaction is fair to the corporation at the time it was entered into.
702.164 Liability for unlawful distributions. Unless a director complies with the applicable standards of conduct, a director who votes for or assents to a distribution made in violation of this chapter or the articles of incorporation is personally liable to the corporation for the amount of the distribution that exceeds what could have been distributed without violating this chapter.
702.168 Liability of qualified directors.
- The civil liability of a director for the performance or nonperformance of the director’s duties shall be limited to gross negligence or intentional misconduct.
- This section does not affect the civil liability of the entity which a qualified director serves.
702.170 Required officers. A corporation shall have a president, a secretary and such other officers as are elected or appointed by the board or by any other person as may be authorized in the articles or bylaws, provided that the articles of incorporation or bylaws may designate other titles in lieu of president and secretary.
702.172 Duties and authority of officers. Each officer has the authority and shall perform the duties set forth in the bylaws or, to the extent consistent with the bylaws, the duties and authority prescribed by the board of directors or by direction of an officer authorized by the board of directors to prescribe the duties of other officers.
702.174 Standards of conduct for officers.
- An officer shall discharge the officer’s duties in good faith, with the care an ordinarily prudent person in a like position would exercise under similar circumstances, and in a manner the officer reasonably believes to be in the best interests of the corporation.
- In discharging the duties of an officer, an officer is entitled to rely on information, opinions, reports or statements, including financial statements and other financial data, if prepared or presented by one or more officers or employees of the corporation whom the officer reasonably believes to be reliable and competent in the matters presented, legal counsel, public accountants or other persons as to matters the officer reasonably believes are within the person’s professional or expert competence; or
702.176 Resignation and removal of officers. An officer may resign at any time by delivering notice to the corporation. A board of directors or any other person authorized under the articles or bylaws to elect or appoint an officer may remove any officer the board or any other person is entitled to elect or appoint, at any time with or without cause.
702.180 Authority to indemnify.
- (Except as provided in subsection (2) of this section, a corporation may indemnify an individual made a party to a proceeding because the individual is or was a director against liability incurred in the proceeding if the conduct of the individual was in good faith, the individual reasonably believed that the individual’s conduct was in the best interests of the corporation, or at least not opposed to its best interests and in the case of any criminal proceeding, the individual had no reasonable cause to believe the conduct of the individual was unlawful.
- A corporation may not indemnify a director under this section: in connection with a proceeding by or in the right of the corporation in which the director was adjudged liable to the corporation; or in connection with any other proceeding charging improper personal benefit to the director in which the director was adjudged liable on the basis that personal benefit was improperly received by the director.
- Indemnification permitted under this section in connection with a proceeding by or in the right of the corporation is limited to reasonable expenses incurred in connection with the proceeding.
702.182 Mandatory indemnification. Unless limited by its articles of incorporation, a corporation shall indemnify a director who was wholly successful, on the merits or otherwise, in the defense of any proceeding to which the director was a party because of being a director of the corporation against reasonable expenses actually incurred by the director in connection with the proceeding.
702.184 Court-ordered indemnification. Unless the corporation’s articles of incorporation provide otherwise, a director of the corporation who is a party to a proceeding may apply for indemnification to the court conducting the proceeding or to another court of competent jurisdiction. On receipt of an application, the court after giving any notice the court considers necessary may order indemnification in the amount it considers proper.
702.186 Determination and authorization of indemnification. A corporation may not indemnify a director unless authorized in the specific case after a determination has been made that indemnification of the director is permissible in the circumstances because the director has met the standard of conduct set forth in WSTC § 702.180 A determination that indemnification of a director is permissible shall be made: by the board of directors by majority vote of a quorum consisting of directors not at the time parties to the proceeding; if a quorum cannot be obtained, by a majority vote of a committee duly designated by the board of directors, consisting solely of two or more directors not at the time parties to the proceeding; or by special legal counsel selected by the board of directors or its committee.
702.187 Indemnification of officers, employees and agents. Unless a corporation’s articles of incorporation provide otherwise an officer of the corporation is entitled to mandatory indemnification, and is entitled to apply for court-ordered indemnification in each case, to the same extent as a director.
702.188 Insurance. A corporation may purchase and maintain insurance on behalf of an individual against liability asserted against or incurred by the 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 business or nonprofit corporation, partnership, joint venture, trust, employee benefit plan or other enterprise.
VIII. AMENDMENT OF ARTICLES OF INCORPORATION AND BYLAWS
702.190 Authority. A corporation may amend its articles of incorporation at any time to add, change or delete any provision.
702.192 Amendment by directors. Unless the articles provide otherwise, a corporation’s board of directors may adopt one or more amendments to the corporation’s articles without member approval to extend the duration of the corporation if it was incorporated at a time when limited duration was required by law to make any other change expressly permitted by this chapter to be made by director action.
702.194 Amendment by board of directors and members. Unless this chapter, the articles, bylaws, the members, or the board of directors, require a greater vote or voting by class, an amendment to a corporation’s articles to be adopted must be approved by the board if the corporation is a public benefit or religious corporation and the amendment does not relate to the number of directors, the composition of the board, the term of office of directors or the method or way in which directors are elected or selected; by the members entitled to vote on articles by at least two-thirds of the votes cast or a majority of the voting power, whichever is less; and in writing by any person or persons whose approval is required for an amendment to the articles. The members entitled to vote on articles may condition the amendment’s adoption on receipt of a higher percentage of affirmative votes or on any other basis.
702.196 Class voting by members on amendments.
- In a public benefit corporation the members of a class entitled to vote on articles are entitled to vote as a class on a proposed amendment to the articles if the amendment would affect the rights of that class as to voting in a manner different than the amendment would affect another class or members of another class.
- In a mutual benefit corporation the members of a class entitled to vote on articles are entitled to vote as a class on a proposed amendment to the articles if the amendment would effect the rights, privileges, preferences, restrictions or conditions of that class as to voting, dissolution, redemption or transfer of memberships in a manner different than such amendment would affect another class; change the rights, privileges, preferences, restrictions or conditions of that class as to voting, dissolution, redemption or transfer by changing the rights, privileges, preferences, restrictions or conditions of another class; increase or decrease the number of memberships authorized for that class; increase the number of memberships authorized for another class; effect an exchange, reclassification or termination of the memberships of that class; or authorize a new class of memberships.
- If a class is to be divided into two or more classes as a result of an amendment to the articles of a public benefit or mutual benefit corporation, the amendment must be approved by the members of each class entitled to vote on articles that would be created by the amendment.
702.197 Articles of amendment. A corporation amending its articles shall deliver for filing to the Office of the Secretary-Treasurer articles of amendment.
702.198 Restated articles of incorporation. A corporation’s board of directors may restate its articles of incorporation at any time with or without approval by members or any other person. The restatement may include one or more amendments to the articles.
702.199 Amendment pursuant to court order. A corporation’s articles may be amended without board approval or approval by the members entitled to vote on articles to carry out a plan of reorganization ordered or decreed by a court of competent jurisdiction under federal statute.
702.200 Amendment by directors. Unless otherwise provided in its articles or bylaws, a corporation with no members with the power to vote on bylaws shall amend its bylaws as provided in this section. The corporation’s incorporators, until directors have been chosen, and thereafter its board of directors may adopt one or more amendments to the corporation’s bylaws.
702.202 Amendment by directors and members. A corporation’s board of directors may amend or repeal the corporation’s bylaws unless the articles of incorporation or this chapter reserve this power exclusively to the members, or to a party authorized, or both, in whole or in part; or the members entitled to vote on bylaws, in amending or repealing a particular bylaw, provide expressly that the board of directors may not amend or repeal that bylaw.
702.204 Approval by third persons. The articles may require an amendment to the articles or bylaws to be approved in writing by a specified person or persons other than the board. Such an article provision may not be amended without the approval in writing of such person or persons.
IX. SALE OF ASSETS
702.210 Sale of assets in regular course of activities; mortgage of assets. A corporation may, on the terms and conditions and for the consideration determined by the board of directors sell, lease, exchange or otherwise dispose of all or substantially all of its property in the usual and regular course of its activities, or mortgage, pledge, dedicate to the repayment of indebtedness, whether with or without recourse, or otherwise encumber any or all of its property whether or not in the usual and regular course of its activities.
702.212 Sale of assets other than in regular course of activities.
- A corporation may sell, lease, exchange or otherwise dispose of all or substantially all of its property, with or without the good will, other than in the usual and regular course of its activities, on the terms and conditions and for the consideration determined by the corporation’s board of directors if the proposed transaction is authorized by subsection (2) of this section.
- Unless this chapter, the articles, bylaws or the board of directors or members, require a greater vote or voting by class, the proposed transaction to be authorized must be approved by the board, by the members entitled to vote on the transaction by at least two-thirds of the votes cast or a majority of the voting power, whichever is less, and in writing by any person or persons whose approval is required for an amendment to the articles or bylaws by a provision of the articles.
702.220 Prohibited distributions. Except as authorized by WSTC § 702.222, a corporation shall not make any distributions.
702.222 Authorized distributions. Unless prohibited by its articles or bylaws a mutual benefit corporation may purchase its memberships, if after the purchase is completed: the corporation would be able to pay its debts as they become due in the usual course of its activities, and the corporation’s total assets would at least equal the sum of its total liabilities.
702.230 Dissolution by incorporators. A majority of the incorporators of a corporation that has no members and that does not yet have initial directors may, subject to any approval required by the articles or bylaws, dissolve the corporation by delivering articles of dissolution to the Office of the Secretary-Treasurer for filing.
702.232 Dissolution by directors, members and third persons. Unless this chapter, the articles, bylaws or the board of directors or members, require a greater vote or voting by class, dissolution is authorized if it is approved by the board, by the members entitled to vote on dissolution, if any, by at least two-thirds of the votes cast or a majority of the voting power, whichever is less, and in writing, by any person or persons whose approval is required for an amendment of the articles or bylaws, or for dissolution. If the corporation does not have members entitled to vote on dissolution, dissolution must be approved by a vote of a majority of the directors in office at the time the transaction is approved. The notice must also state that the purpose, or one of the purposes, of the meeting is to consider dissolving the corporation and contain or be accompanied by a copy or summary of the plan of dissolution.
702.234 Articles of dissolution. At any time after dissolution is authorized, the corporation may dissolve by delivering to the Office of the Secretary-Treasurer for filing.
702.235 Revocation of dissolution. A corporation may revoke its dissolution within 120 days of its effective date. Revocation of dissolution must be authorized in the same manner as the dissolution was authorized unless that authorization of dissolution permits revocation by action of the board of directors alone. If the authorization of dissolution permits revocation by action of the board of directors alone, the board of directors may revoke the dissolution without action by the members or any other person. After the revocation of dissolution is authorized, the corporation may revoke the dissolution by delivering to the Office of Secretary-Treasurer for filing.
702.236 Effect of dissolution. A dissolved corporation continues its corporate existence but may not carry on any activities except those appropriate to wind up and liquidate its affairs, including: preserving and protecting its assets and minimizing its liabilities, discharging or making provision for discharging its liabilities and obligations, disposing of its properties that will not be distributed in kind, returning, transferring or conveying assets held by the corporation upon a condition requiring return, transfer or conveyance, which condition occurs by reason of the dissolution, in accordance with such condition, transferring, subject to any contractual or legal requirements, its assets as provided in or authorized by its articles of incorporation or bylaws;
702.237 Known claims against dissolved corporation. A corporation electing to dispose of known claims pursuant to this section shall notify its known claimants in writing of the dissolution at any time after its effective date.
702.238 Unknown claims against dissolved corporation. A dissolved corporation may publish notice of its dissolution and request that persons with claims against the corporation present them in accordance with the notice. The notice must be published at least one time in a newspaper of general circulation in the county where the dissolved corporation’s principal office is located, or if the principal office is not in this Reservation, where its registered office is or was last located; describe the information that must be included in a claim and provide a mailing address where the claim may be sent; and state that a claim against the corporation will be barred unless a proceeding to enforce the claim is commenced within five years after publication of the notice.
702.240 Grounds for administrative dissolution. The Secretary-Treasurer may commence a proceeding under Tribal Law to administratively dissolve a corporation if: the corporation does not pay when due any fees imposed by this chapter; the corporation does not deliver its annual report to the Secretary-Treasurer when due; the corporation is without a registered agent or registered office in this Reservation; the corporation does not notify the Secretary-Treasurer that its registered agent or registered office has been changed, that its registered agent has resigned, or that its registered office has been discontinued; or the corporation’s period of duration, if any, stated in its articles of incorporation expires.
702.242 Procedure for and effect of administrative dissolution. If the Secretary- Treasurer determines that one or more grounds exist under Tribal Law for dissolving a corporation, the Secretary-Treasurer shall give the corporation written notice of that determination.
702.250 Hearings officer: The Secretary-Treasurer shall appoint a person who possesses expertise in business affairs, including but not limited to taxation, accounting and an understanding of fiduciary relationships, as a hearings officer to preside over judicial dissolutions under this chapter. The decisions of any such hearings officer shall be final and binding.
702.252 Grounds for judicial dissolution. The hearings officer may dissolve a corporation in a hearing before the hearing officer if it is established that the corporation obtained its articles of incorporation through fraud; the corporation has exceeded or abused the authority conferred upon it by law; the corporation has fraudulently solicited money or has fraudulently used the money solicited; the corporation is a public benefit corporation and the corporate assets are being misapplied or wasted; or the corporation is a public benefit corporation and is no longer able to carry out its purposes;
702.254 Decree of dissolution. If after a hearing the court determines that one or more grounds for judicial dissolution exist, it may enter a decree dissolving the corporation and specifying the effective date of the dissolution. The clerk of the court shall deliver a certified copy of the decree to the Office of the Secretary-Treasurer for filing.
XII. RECORDS AND REPORTS
702.260 Corporate records.
- A corporation shall keep as permanent records minutes of all meetings of its members and board of directors, a record of all corporate action taken by the members or directors without a meeting, and a record of all actions taken by committees of the board of directors in place of the board of directors on behalf of the corporation.
- A corporation shall maintain appropriate accounting records.
- A corporation or its agent shall maintain a record of its members in a form that permits preparation of a list of the name and address of all members, in alphabetical order by class showing the number of votes each member is entitled to vote.
- A corporation shall maintain its records in written form or in another form capable of conversion into written form within a reasonable time.
- Any corporate records are subject to inspection and copying at reasonable request, and at the expense of any member or any members agent or attorney during ordinary business hours.
- Failure of the corporation to keep or maintain any of the records or information required pursuant to this section shall not be grounds for imposing liability on any person for the debts and obligations og the corporation.
702.262 Inspection of records by members. A member is entitled to inspect and copy, at a reasonable time and location specified by the corporation, any of the records of the corporation if the member gives the corporation written notice of the member’s demand at least five business days before the date on which the member wishes to inspect and copy.
702.264 Court-ordered inspection. If a corporation does not allow a member to inspect and copy any records to be available for inspection, the hearings officer summarily order inspection and copying of the records demanded at the corporation’s expense upon application of the member.
702.270 Preservation of exemptions and immunities. Nothing in this chapter shall be deemed to have waived or to permit a corporation to waive any individual tribal member’s immunity from suit or from any applicable immunity or exemption with regard to federal or local taxation; therefore, any member of the Tribe shall continue to maintain any applicable immunity or exemption from taxation under federal or local law upon becoming a member of any corporation organized under this chapter.
702.272 Regulations. The Secretary-Treasurer shall have the authority to make rules and regulations as may be necessary to implement the provisions of this chapter, including, but not limited to, enforcement procedures for decisions of the Warm Springs Tribal Court or any hearings officers appointed under this chapter.
702.274 Warm Springs Tribal Court. Except as otherwise specifically provided herein, the Warm Springs Tribal Court shall have jurisdiction over corporations organized under this chapter.
702.276 Definitions. As used in this chapter:
- “Anniversary” means that day each year exactly one or more years after the date of filing by the Secretary-Treasurer of the articles of organization of a corporation.
- “Articles of organization” means the document described in WSTC § 702.022 for the purpose of forming a corporation including articles of organization as they may be amended or restated.
- “Approved by the members” or “approval by the members” means approved or ratified by the members entitled to vote on the issue through either: (a) The affirmative vote of a majority of the votes of such members represented and voting at a duly held meeting at which a quorum is present or the affirmative vote of such greater proportion including the votes of any required proportion of the members of any class as the articles, bylaws or this chapter may provide for specified types of member action; or (b) A written ballot or written consent in conformity with this chapter.
- “Articles of incorporation” or “articles” include amended and restated articles of incorporation, and corrections thereto.
- “Board” or “board of directors” means the individual or individuals vested with overall management of the affairs of the domestic or foreign corporation, irrespective of the name by which the individual or individuals are designated.
- “Bylaws” means the code or codes of rules, other than the articles adopted pursuant to this chapter or the laws governing a foreign corporation for the regulation or management of the affairs of the domestic or foreign corporation, irrespective of the name or names by which such rules are designated.
- “Class” means a group of memberships which have the same rights with respect to voting, dissolution, redemption and transfer. For the purpose of this section, rights shall be considered the same if they are determined by a formula applied uniformly.
- “Distribution” means a direct or indirect transfer of money or other property, except of a corporation’s own interests, or incurrence of indebtedness by a corporation to or for the benefit of its members in respect of any of its member’s interests. A distribution may be in the form of a declaration or payment of profits, a purchase, retirement or other acquisition of interests, a distribution of indebtedness, or otherwise.
- “Entity” includes a domestic or foreign corporation, domestic or foreign nonprofit corporation, domestic or foreign cooperative corporation, profit or nonprofit unincorporated association, business trust, estate, domestic or foreign general or limited partnership, trust, two or more persons having a joint or common economic interest, any state, any reservation, the United States or any foreign government.
- “Incompetency” means the entry of a judgment by a court of competent jurisdiction adjudicating the member incompetent to manage the member’s person or estate.
- “Individual” means a natural person.
- “Corporation” or “domestic corporation” means a nonprofit corporation which is not a foreign corporation, which is incorporated under or subject to the provisions of this chapter.
- “Member” or “members” means any person or persons entitled, pursuant to a domestic or foreign corporation’s articles or bylaws, without regard to what a person is called in the articles or bylaws, to vote on more than one occasion for the election of a director or directors.
- “Nonprofit corporation” means mutual benefit corporations, public benefit corporations and religious corporations.
- “Office,” when used to refer to the administrative unit directed by the Secretary- Treasurer, means the office of the Secretary-Treasurer.
- “Organizer” means one of the signers of the initial articles of organization.
- “Party” includes an individual who was, is or is threatened to be made a named defendant or respondent in a proceeding.
- “Person” means an individual or entity.
- “Proceeding” means any threatened, pending or completed action, suit or proceeding whether civil, criminal, administrative or investigatory and whether formal or informal.
- “Reservation” means the Warm Springs Indian Reservation.
- “Secretary-Treasurer” means the Secretary-Treasurer of the Tribe or any person or department to which the Secretary-Treasurer may delegate the Secretary- Treasurer’s duties under this chapter.
- “Tribe” means the Confederated Tribes of the Warm Springs Reservation of Oregon.