36 U.S.C. § 153713 — Distribution of assets on dissolution or final liquidation

submitted 28 years ago by Pub. L. 105-225 to r/title-36-PATRIOTIC-AND-NATIONAL-OBSERVANCES-CEREMONIES-AND-ORGANIZATIONS · 207 words · no verdicts yet

in plain englishAI-generated · not legal advice

If the corporation dissolves, it must first pay off its debts, then return any assets held on condition. Charitable-purpose assets go to similar organizations. Anything left follows the bylaws or a distribution plan.

If the corporation dissolves or finally winds up, its assets are distributed in this order: (1) All liabilities must be paid and discharged, or adequate provision made for paying and discharging them. (2) Assets held on a condition requiring their return or transfer on dissolution must be returned or transferred as that condition requires. (3) Assets that were received and held only for use for charitable, religious, benevolent, educational, or similar purposes — but that were not held on a condition requiring return or transfer on dissolution — must be transferred to one or more suitable domestic or foreign corporations, societies, or organizations, under a plan of distribution adopted as this chapter provides. (4) Other assets are distributed as the articles of incorporation or bylaws provide, to the extent those documents set out members' distributive rights or provide for distribution to others. (5) Any assets still remaining may be distributed to nonprofit people, societies, organizations, or domestic or foreign corporations, under a plan of distribution the council of administration adopts, and in compliance with the corporation's constitution and bylaws.

the actual law source: uscode.house.gov ↗public domain

On dissolution or final liquidation of the corporation, its assets shall be distributed as follows:

(1)

All liabilities shall be paid and discharged, or adequate provision for payment and discharge shall be made.

(2)

Assets held on condition requiring return or transfer on dissolution of the corporation shall be returned or transferred as required by the condition.

(3)

Assets received and held subject to a limitation permitting use only for charitable, religious, benevolent, educational, or similar purposes, but not held on a condition requiring return or transfer on dissolution of the corporation, shall be transferred to one or more appropriate domestic or foreign corporations, societies, or organizations under a plan of distribution adopted as provided in this chapter.

(4)

Other assets shall be distributed as provided by the articles of incorporation or bylaws to the extent that the articles or bylaws provide the distributive rights of members, or any class of members, or provide for distribution to others.

(5)

Any remaining assets may be distributed to persons, societies, organizations, or domestic or foreign corporations engaged in activities not for profit, as provided in a plan of distribution adopted by the council of administration of the corporation and in compliance with the constitution and bylaws of the corporation.

Source credit: (Pub. L. 105–225, Aug. 12, 1998, 112 Stat. 1430.)

history & why it existsrecord from the source credit

1998Enacted · Pub. L. 105-225 · 112 Stat. 1430

A history note hasn’t been published yet. The record shows enactment by Pub. L. 105-225 on 1998-08-12.

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