Utah Code 16-6a-1302. Authorized distributions

16-6a-1302. Authorized distributions.

(1)

A nonprofit corporation may:

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Terms Used In Utah Code 16-6a-1302

Articles of incorporation: include :

(a)	amended articles of incorporation;

(b)	restated articles of incorporation;

(c)	articles of merger; and

(d)

a document of a similar import to the documents described in Subsections (3)(a) through (c). See Utah Code 16-6a-102

Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.

Bylaws: includes :

(i)	amended bylaws; and

(ii)

restated bylaws. See Utah Code 16-6a-102

cooperative: means a nonprofit corporation organized or existing under this chapter. See Utah Code 16-6a-102

Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.

Entity: includes :

(a)	a domestic or foreign corporation;

(b)	a domestic or foreign nonprofit corporation;

(c)	a limited liability company;

(d)	a profit or nonprofit unincorporated association;

(e)	a business trust;

(f)	an estate;

(g)	a partnership;

(h)

a trust;

(i)	two or more persons having a joint or common economic interest;

(j)

a state;

(k)	the United States; or

(l)

a foreign government. See Utah Code 16-6a-102

Foreign nonprofit corporation: means an entity:

(a)	incorporated under a law other than the laws of this state; and

(b)

that would be a nonprofit corporation if formed under the laws of this state. See Utah Code 16-6a-102

Member: includes :

(i)	"voting member"; and

(ii)

a shareholder in a water company. See Utah Code 16-6a-102

Mutual benefit corporation: means a nonprofit corporation:

(a)	that issues shares of stock to its members evidencing a right to receive distribution of water or otherwise representing property rights; or

(b)

all of whose assets are contributed or acquired by or for the members of the nonprofit corporation or their predecessors in interest to serve the mutual purposes of the members. See Utah Code 16-6a-102

Receive: when used in reference to receipt of a writing or other document by a domestic or foreign nonprofit corporation, means the writing or other document is actually received:

(a)

by the domestic or foreign nonprofit corporation at:

(i)	its registered office in this state; or

(ii)	its principal office;

(b)	by the secretary of the domestic or foreign nonprofit corporation, wherever the secretary is found; or

(c)

by another person authorized by the bylaws or the board of directors to receive the writing or other document, wherever that person is found. See Utah Code 16-6a-102

Shareholder: means a person in whose name a share is registered in the records of a nonprofit corporation. See Utah Code 16-6a-102

Water company: means :

(a)	the same as that term is defined in Subsection 16-4-102(5); or

(b)

a mutual benefit corporation, when the stock in the mutual benefit corporation represents a right to receive a distribution of water for beneficial use. See Utah Code 16-6a-102

(a)

make distributions or distribute the nonprofit corporation’s assets to a:

(i)	member that is a domestic or foreign nonprofit corporation;

(ii)	member of a mutual benefit corporation, not inconsistent with its bylaws;

(iii)

shareholder of a water company in a manner consistent with its articles of incorporation, bylaws, and the provisions of this chapter; or

(iv)	governmental entity;

(b)	pay compensation in a reasonable amount to its members, directors, or officers for services rendered;

(c)	if a cooperative nonprofit corporation, make distributions consistent with its purposes; and

(d)	confer benefits upon its members in conformity with its purposes.

(2)

A nonprofit corporation may make distributions upon dissolution as follows:

(a)	to a member that is a domestic or foreign nonprofit corporation;

(b)	to its members if it is a mutual benefit corporation;

(c)	to a shareholder of a water company in proportion to the shareholder’s interest in the water company, consistent with the water company’s articles of incorporation and bylaws;

(d)	to another nonprofit corporation, including a nonprofit corporation organized to receive the assets of and function in place of the dissolved nonprofit corporation; and

(e)	otherwise in conformity with 14.

(3)

Authorized distributions by a dissolved nonprofit corporation may be made by authorized officers or directors, including those elected, hired, or otherwise selected after dissolution if the election, hiring, or other selection after dissolution is not inconsistent with the articles of incorporation and bylaws existing at the time of dissolution.

Amended by Chapter 358, 2017 General Session

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