Public Law No. 15-21

1 Section 1. Title 27 of the Code of the Federated States of

2 Micronesia, as enacted by Public Law No. 15-08, is hereby amended 3 by adding a new subsection 3 to Section 265 thereof to read as 4 follows:

5 "Section 265. Issuance of Shares; divestment.

6 (1) Upon the written instruction of the Executive

7 Council, the Corporation shall, through the filing of 8 such documents as may be required of privately-held 9 corporations, including, without limitation, Articles of

10 Incorporation, Bylaws and Share Affidavits, capitalize 11 itself through the issuance of common shares and, in 12 such event, the provisions of this Chapter shall be made 13 subject to the terms of the Articles of Incorporation 14 and Bylaws, and nothing in this Chapter shall be read as 15 restricting the payment of dividends, the holding of 16 annual shareholder’s meetings, the conduct of audits for 17 the benefit of shareholders, the election of Directors 18 and such other corporate governance and shareholder’s 19 rights provisions as may be set out in the Articles of CBL 15-86 CONGRESSIONAL BILL NO. 15-82 PC NO. 15-116 PUBLIC LAW NO. 15-21

1 Incorporation and Bylaws and approved by the Executive

2 Council.

3 (2) Upon the written instruction of the Executive

4 Council, the Corporation shall, subject to the 5 conditions set forth in Section 243, take all necessary 6 steps to divest its assets and operations, in whole or 7 in part, to such entity or entities as shall be directed 8 by the Executive Council. The Board and officers of the

9 Corporation shall take all necessary actions to 10 effectuate such divestment, including the execution of 11 documents and instruments, and the turnover of books, 12 records and personal property as shall be necessary to 13 transfer operations and assets of the Corporation to the 14 entity or entities designated by the Executive Council.

15 Upon written instruction of the Executive Council 16 following such divestment, the Corporation shall wind up 17 its affairs and cease operation."

18 (3) Notwithstanding any other provisions of this

19 Section, the assets and operations of the Corporation 20 may be divested to the State in which the assets and 21 operations are located if:

22 (a) such State provides full payment or 23 reimbursement of all debts and expenses incurred by the

24 Government of the Federated States of Micronesia and the

25 Corporation in the acquisition of those assets, and any 26 product inventory remaining therein at the time of the 2 of 3 CONGRESSIONAL BILL NO. 15-82 PC NO. 15-116 PUBLIC LAW NO. 15-21 1 divestment;

2 (b) such divestment is approved by the majority 3 decision of the Executive Council; and

4 (c) the manner of divestment does not breach any 5 agreement to which the Corporation, the Government of 6 the Federated States of Micronesia, or the State is 7 bound in respect of the assets or the supply of 8 products.

9 Section 2. Effectiveness. This act shall become law upon 10 approval by the President of the Federated States of Micronesia or 11 upon its becoming law without such approval. 12 13 14 15

16 December 7, 2007 17 18 19 20 21 /s/ Manny Mori Manny Mori

22 President Federated States of Micronesia 23 3 of 3