Ala. Code § 10A-3A-11.07

Current through the 2024 Regular Session.

Section 10A-3A-11.07 - Effect of dissolution

(a) A dissolved nonprofit corporation continues its existence as a nonprofit corporation but may not carry on any activity except as is appropriate to wind up and liquidate its activities and affairs, including:

(1) collecting its assets;

(2) disposing of its properties that will not be distributed in kind;

(3) discharging or making provisions for discharging its liabilities;

(4) distributing its remaining property as required by law, its certificate of incorporation, bylaws, and as approved when the dissolution was authorized; and

(5) doing every other act necessary to wind up and liquidate its activities and affairs.

(b) In winding up its activities and affairs, a dissolved nonprofit corporation may:

(1) preserve the nonprofit corporation's activities and affairs and property as a going concern for a reasonable time;

(2) prosecute, defend, or settle actions or proceedings whether civil, criminal, or administrative;

(3) transfer the nonprofit corporation's assets;

(4) resolve disputes by mediation or arbitration; and

(5) merge or convert in accordance with Article 12 or 13 of this chapter or Article 8 of Chapter 1.

(c) Dissolution of a nonprofit corporation does not:

(1) transfer title to the nonprofit corporation's property;

(2) subject its directors or officers to standards of conduct different from those prescribed in Article 8 of this chapter;

(3) change:

(i) quorum or voting requirements for its board of directors or members;

(ii) provisions for selection, resignation, or removal of its directors or officers or both; or

(iii) provisions for amending its bylaws;

(4) prevent commencement of a proceeding by or against the nonprofit corporation in its corporate name;

(5) abate or suspend a proceeding pending by or against the nonprofit corporation on the effective date of dissolution; or

(6) terminate the authority of the registered agent of the nonprofit corporation.

(d) A distribution in liquidation under this section may only be made by a dissolved nonprofit corporation.

Ala. Code § 10A-3A-11.07 (1975)

Amended by Act 2024-413,§ 1, eff. 8/1/2024.

Added by Act 2023-503,§ 1, eff. 1/1/2024.