10-1502. Consequences of transacting business
without authority; penalty
A. A foreign corporation transacting business in this state without a grant of
authority shall not be permitted to maintain a proceeding in any court in this state
until it is authorized to transact business.
B. The successor to a foreign corporation that transacted business in this state
without a grant of authority and the assignee of a cause of action arising out of that
business may not maintain a proceeding based on that cause of action in any court in this
state until the foreign corporation or its successor obtains authority to transact
business.
C. A court may stay a proceeding commenced by a foreign corporation, its successor
or its assignee until it determines whether the foreign corporation, its successor or its
assignee requires authority to transact business in this state. If it so determines, the
court may further stay the proceeding until the foreign corporation or its successor
obtains authority to transact business in this state.
D. A foreign corporation that transacts business in this state without authority is
liable to this state, for the years or portions of years during which it transacted
business in this state without authority, in an amount equal to all fees that would have
been imposed by chapters 1 through 17 of this title on the corporation if it had duly
applied for and received authority to transact business in this state as required by
chapters 1 through 17 of this title and thereafter filed all reports required by chapters
1 through 17 of this title. In addition to all penalties imposed by chapters 1 through
17 of this title for failure to pay the fees, the corporation shall pay a penalty of up
to one thousand dollars to this state for violating this section. The attorney general
may bring proceedings to recover all amounts due this state under this section.
E. Notwithstanding subsections A and B, the failure of a foreign corporation to
obtain authority to transact business in this state does not impair the validity of its
corporate acts or prevent it from defending any proceedings in this state.
F. The attorney general or any other person may bring and maintain an action to
enjoin any foreign corporation from transacting business in this state without
authority. On a foreign corporation obtaining authority, the action shall be dismissed,
but the plaintiff shall recover its costs and reasonable attorney fees. A determination
by a court of competent jurisdiction in this state that a party to the action is a
foreign corporation that was required but failed to qualify as a foreign corporation
under chapters 1 through 17 of this title is prima facie evidence against the foreign
corporation in any other action brought by or against it by any other person of the
requirement to and failure to qualify.
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