Sec 10-1623. Statement of bankruptcy or receivership; interrogatories before subsequent incorporation; violation; classification; definitions

A. On the filing of a petition for bankruptcy or the appointment of a receiver for any corporation, the corporation shall deliver a statement to the commission listing:

1. All officers, directors, trustees and major stockholders of the corporation within one year of filing the petition for bankruptcy or the appointment of a receiver. If a major stockholder is a corporation, the statement shall list the current president, chairman of the board of directors and major stockholders of such corporate stockholder.

2. Whether any such person has been an officer, director, trustee or major stockholder of any other corporation within one year of the bankruptcy or receivership of the other corporation.

3. If the answer in paragraph 2 of this subsection is in the affirmative, for each such corporation the following information:

(a) Name and address.

(b) States in which it:

(i) Was incorporated.

(ii) Transacted business.

(c) Dates of operation.

B. The commission shall maintain a suitably indexed list of all such persons. The index is a public record of the commission for purposes of title 39.

C. On receipt for filing of articles of incorporation of a new corporation or application for authority to transact business by a foreign corporation, the commission shall determine whether any person proposed as an officer, director, trustee, incorporator or major stockholder of the new or foreign corporation has been involved two or more times in a corporate bankruptcy, receivership, revocation, administrative dissolution or judicial dissolution commenced by any state. If so, the commission may direct detailed interrogatories to the persons requiring any additional relevant information deemed necessary by the commission and at the same time shall provide public notice of the interrogatory procedure. Any person may request additional interrogatories or may provide additional information to the commission. The interrogatories shall be completely answered within thirty days after mailing. With respect to corporations incorporated or seeking authority to transact business, articles of incorporation or application for authority shall not be filed until all outstanding interrogatories have been answered to the satisfaction of the commission.

D. Any applicant for filing articles of incorporation or authority to transact business who is dissatisfied with a determination of the commission or any other proceeding under this section may demand and the commission or its designee shall convene a public hearing at the county seat of the county of the corporate headquarters of the proposed corporation. The commission shall give public notice of the hearing at least twenty days before the hearing by publication in a newspaper of general circulation in any county in which a relevant prior bankruptcy or receivership occurred.

E. The commission shall provide the attorney general with a copy of statements furnished pursuant to subsection A and answers to interrogatories propounded pursuant to subsection C on a quarterly updated basis.

F. Any person or corporation failing to comply with the requirements of this section is guilty of a class 1 misdemeanor. Any person making a false statement or giving false information pursuant to this section is guilty of a class 5 felony.

G. In this section:

1. "Controlling" includes the total shares of stock issued to a husband and wife and their relatives to the first degree of consanguinity.

2. "Major stockholder" means a shareholder possessing or controlling twenty per cent of the issued and outstanding shares or twenty per cent of any proprietary, beneficial or membership interest in the corporation.