65-25-220 - Dissolution. - Tennessee Statutes

65-25-220. Dissolution.

(a)  A cooperative which has not commenced business may dissolve voluntarily by delivering to the secretary of state articles of dissolution, executed and acknowledged on behalf of the cooperative by a majority of the incorporators, which shall state:

     (1)  The name of the cooperative;

     (2)  The address of its principal office;

     (3)  That the cooperative has not commenced business;

     (4)  That the amount, if any, actually paid in on account of membership fees, less any part thereof disbursed for necessary expenses, has been returned to those entitled thereto and that all easements shall have been released to the grantors;

     (5)  That no debt of the cooperative remains unpaid; and

     (6)  That a majority of the incorporators elect that the cooperative be dissolved.

Such articles of dissolution shall be submitted to the secretary of state for filing as provided in this part.

(b)  (1)  A cooperative which has commenced business may dissolve voluntarily and wind up its affairs in the following manner: Except as provided in § 65-25-213(a)(2)(D), the board shall first recommend that the cooperative be dissolved, which recommendation shall be submitted to the members of the cooperative at any annual or special meeting, the notice of which shall set forth such proposition. The proposed voluntary dissolution shall be deemed to be approved upon the affirmative votes of:

          (A)  If dissolution is or will be an incident of the sale, lease-sale or other disposition of the assets and properties of the cooperative, as many as but not fewer than the percentage of the cooperative's members required to authorize such sale, lease-sale or other disposition as provided in § 65-25-213(a)(1)(A), (B), (C), (D), (E) or (F), or § 65-25-213(a)(4), or (b), or § 65-25-214(a), (b) or (c), whichever is applicable; or

          (B)  If dissolution is or will be from any other cause, the number or percentage of its members, or of those voting, whichever may be the case, as provided in the cooperative's articles of incorporation or bylaws.

     (2)  Any assets remaining after the discharge or provision for the discharge of all of the cooperative's liabilities and the distribution of any patronage capital still outstanding on its books shall be distributed on a pro rata basis and without priority to all present and former members of the cooperative to the extent practicable, as determined by the board; provided, that if the board determines that the amount of such surplus is so small in relation to the administrative cost of distributing it as to be prohibited, such surplus may be donated by the board to one (1) or more charitable or educational organizations which are exempt from federal income taxation.

[Acts 1988, ch. 689, § 2.]