2016 Kentucky Revised Statutes CHAPTER 386 - ADMINISTRATION OF TRUSTS -- LEGAL INVESTMENTS -- UNIFORM PRINCIPAL AND INCOME ACT .365 Distribution of assets upon dissolution -- Process for selection of receiving trust -- Assets available for distribution defined.
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386.365 Distribution of assets upon dissolution -- Process for selection of receiving
trust -- Assets available for distribution defined.
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Upon termination or dissolution of any trust or other entity (other than a
corporation) which is or may become an exempt organization as described in
Section 501(c)(3) of the Internal Revenue Code of 1954, as amended, or a charitable
trust described in Section 4947(a)(1) of the Internal Revenue Code of 1954, as
amended, any assets lawfully available for distribution shall be distributed to one
(1) or more qualifying organizations described in Section 501(c)(3) of said Internal
Revenue Code (or described in any corresponding provision of any successor
statute) which organization or organizations have a charitable purpose which, at
least generally, includes a purpose similar to the terminating or dissolving
organization. The organization to receive the assets of the dissolving organization
hereunder shall be selected in the discretion of a majority of the managing body of
the dissolving organization, and if its members cannot so agree, then the recipient
organization shall be selected pursuant to a verified petition in equity filed in a court
of proper jurisdiction against the terminating or dissolving organization by one (1)
or more of its managing body which verified petition shall contain such statements
as reasonably indicate the applicability of this section. The court upon a finding that
this section is applicable shall select the qualifying organization or organizations to
receive the assets to be distributed, giving preference if practicable to organizations
located within the Commonwealth of Kentucky. In the event that the court shall find
that this section is applicable but that there is no qualifying organization known to it
which has a charitable purpose, which, at least generally, includes a purpose similar
to the terminating or dissolving organization, then the court shall direct the
distribution of its assets lawfully available for distribution to the Treasurer of the
Commonwealth of Kentucky to be added to the general fund.
For purposes of this section "assets lawfully available for distribution" shall include
the assets of a terminating or dissolving organization remaining after:
(a) Payment, or provision for payment, of all liabilities and obligations of the
organization; and
(b) Return, transfer or conveyance of any assets held by the organization (the
terms of creating instrument of which require such return, transfer or
conveyance upon termination or dissolution or otherwise) in accordance with
the terms of the creating instrument; and
(c) In the event legal action is filed pursuant hereto, payment or provision for
payment of all costs, including a reasonable attorney's fee for the parties, fixed
by the court.
This section shall not be construed to deprive any person of any vested property
interest which he may have on June 21, 1974.
History: Created 1974 Ky. Acts ch. 155, sec. 1.
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