Dissolution

KRS tit. XXIII, ch. 271B, subtit. 14

in effect

KRS 271B.14-010 Dissolution by incorporators or initial directors

271B.14-010. Dissolution by incorporators or initial directors A majority of the incorporators or initial directors of a corporation that has not issued shares or has not commenced business may dissolve the corporation by delivering to the Secretary of State for filing articles of dissolution that set forth: (1) The name of the corporation; (2) The date of its incorporation; (3) Either: (a) That none of the corporation's shares has been issued; or (b) That the corporation has not commenced business; (4) That no debt of the corporation remains unpaid; (5) That the net assets of the corporation remaining after winding up have been distributed to the shareholders, if shares were issued; and (6) That a majority of the incorporators or initial directors authorized the dissolution. Effective: January 1, 1989 History: Created 1988 Ky. Acts ch. 23, sec. 137, effective January 1, 1989.

KRS 271B.14-020 Dissolution by board of directors and shareholders

271B.14-020. Dissolution by board of directors and shareholders (1) A corporation's board of directors may propose dissolution for submission to the shareholders. (2) For a proposal to dissolve to be adopted: (a) The board of directors shall recommend dissolution to the shareholders unless the board of directors determines that because of conflict of interest or other special circumstances it should make no recommendation and communicates the basis for its determination to the shareholders; and (b) The shareholders entitled to vote shall approve the proposal to dissolve as provided in subsection (5) of this section. (3) The board of directors may condition its submission of the proposal for dissolution on any basis. (4) The corporation shall notify each shareholder, whether or not entitled to vote, of the proposed shareholders' meeting in accordance with KRS 271B.7-050. The notice shall also state that the purpose, or one of the purposes, of the meeting is to consider dissolving the corporation. (5) Unless the articles of incorporation or the board of directors (acting pursuant to subsection (3)) of this section require a greater vote or a vote by voting groups, the proposal to dissolve to be adopted shall be approved by a majority of all votes entitled to be cast on that proposal. Effective: January 1, 1989 History: Created 1988 Ky. Acts ch. 23, sec. 138, effective January 1, 1989.

KRS 271B.14-030 Articles of dissolution

271B.14-030. Articles of dissolution (1) At any time after dissolution is authorized, the corporation may dissolve by delivering to the Secretary of State for filing an original and three (3) exact or conformed copies of articles of dissolution setting forth: (a) The name of the corporation; (b) The date dissolution was authorized; (c) If dissolution was approved by the shareholders: 1. The number of votes entitled to be cast on the proposal to dissolve; and 2. Either the total number of votes cast for and against dissolution or the total number of undisputed votes cast for dissolution and a statement that the number cast for dissolution was sufficient for approval; and (d) If voting by voting groups was required, the information required by subsection (1)(c) of this section shall be separately provided for each voting group entitled to vote separately on the plan to dissolve. (2) The Secretary of State shall immediately forward one (1) of the exact or conformed copies of the articles of dissolution to the secretary of revenue. (3) A corporation shall be dissolved upon the effective date of its articles of dissolution. Effective: January 1, 1989 History: Created 1988 Ky. Acts ch. 23, sec. 139, effective January 1, 1989.

KRS 271B.14-040 Revocation of dissolution

271B.14-040. Revocation of dissolution (1) A corporation may revoke its dissolution within one hundred twenty (120) days of its effective date. (2) Revocation of dissolution shall be authorized in the same manner as the dissolution was authorized unless that authorization permitted revocation by action of the board of directors alone, in which event the board of directors may revoke the dissolution without shareholder action. (3) After the revocation of dissolution is authorized, the corporation may revoke the dissolution delivering to the Secretary of State for filing articles of revocation of dissolution, together with a copy of its articles of dissolution, that set forth: (a) The name of the corporation; (b) The effective date of the dissolution that was revoked; (c) The date that the revocation of dissolution was authorized; (d) If the corporation's board of directors (or incorporators) revoked the dissolution, a statement to that effect; (e) If the corporation's board of directors revoked a dissolution authorized by the shareholders, a statement that revocation was permitted by action by the board of directors alone pursuant to that authorization; and (f) If shareholder action was required to revoke the dissolution, the information required by subsection (1)(c) or (1)(d) of KRS 271B.14-030. (4) Revocation of dissolution shall be effective upon the effective date of the articles of revocation of dissolution. (5) When the revocation of dissolution is effective, it shall have the effect provided in KRS 14A.7-030(3). Effective: July 12, 2012 History: Amended 2012 Ky. Acts ch. 81, sec. 94, effective July 12, 2012. -- Created 1988 Ky. Acts ch. 23, sec. 140, effective January 1, 1989.

KRS 271B.14-050 Effect of dissolution

271B.14-050. Effect of dissolution (1) A dissolved corporation shall continue its corporate existence but may not carry on any business except that appropriate to wind up and liquidate its business and affairs, including: (a) Collecting its assets; (b) Disposing of its properties that will not be distributed in kind to its shareholders; (c) Discharging or making provision for discharging its liabilities, including as appropriate, entering into agreements with creditors for the satisfaction thereof; (d) Distributing its remaining property among its shareholders according to their interests; and (e) Doing every other act necessary to wind up and liquidate its business and affairs. (2) Dissolution of a corporation shall not: (a) Transfer title to the corporation's property; (b) Prevent transfer of its shares or securities, although the authorization to dissolve may provide for closing the corporation's share transfer records; (c) Subject its directors or officers to standards of conduct different from those prescribed in Subtitle 8 of this chapter; (d) Change quorum or voting requirements for its board of directors or shareholders; change provisions for selection, resignation, or removal of its directors or officers or both; or change provisions for amending its bylaws; (e) Prevent commencement of a proceeding by or against the corporation in its corporate name; (f) Abate or suspend a proceeding pending by or against the corporation on the effective date of dissolution; (g) Terminate the authority of the registered agent of the corporation; (h) Alter the obligations and responsibilities of the corporation as prescribed by applicable federal or state law with regard to the filing or examination of all federal and state tax returns or the payment, assessment, or collection of any federal or state tax due with respect to those returns; or (i) Abate or suspend KRS 271B.6-220. Effective: July 12, 2012 History: Amended 2012 Ky. Acts ch. 81, sec. 95, effective July 12, 2012. -- Repealed and reenacted 2010 Ky. Acts ch. 51, sec. 68, effective July 15, 2010. -- Amended 2007 Ky. Acts ch. 137, sec. 68, effective June 26, 2007. -- Created 1988 Ky. Acts ch. 23, sec. 141, effective January 1, 1989. Legislative Research Commission Note (7/15/2010). 2010 Ky. Acts ch. 51, sec. 183, provides, "The specific textual provisions of Sections 1 to 178 of this Act which reflect amendments made to those sections by 2010 Ky. Acts ch. 137 shall be deemed effective as of June 26, 2007, and those provisions are hereby made expressly retroactive to that date, with the remainder of the text of those sections being unaffected by the provisions of this section."

KRS 271B.14-060 Known claims against dissolved corporation

271B.14-060. Known claims against dissolved corporation (1) A dissolved corporation may dispose of the known claims against it by following the procedure described in this section. (2) The dissolved corporation shall notify its known claimants in writing of the dissolution at any time after its effective date. The written notice shall: (a) Describe information that must be included in a claim; (b) Provide a mailing address where a claim may be sent; (c) State the deadline, which may not be fewer than one hundred twenty (120) days from the effective date of the written notice, by which the dissolved corporation must receive the claim; and (d) State that the claim will be barred if not received by the deadline. (3) A claim against the dissolved corporation shall be barred: (a) If a claimant who was given written notice under subsection (2) of this section does not deliver the claim to the dissolved corporation by the deadline; (b) If a claimant whose claim was rejected by the dissolved corporation does not commence a proceeding to enforce the claim within ninety (90) days from the effective date of the rejection notice. (4) For purposes of this section, "claim" shall not include a contingent liability, a claim based on an event occurring after the effective date of dissolution or any liability to the Commonwealth or the United States for any state or federal tax liability. Effective: January 1, 1989 History: Created 1988 Ky. Acts ch. 23, sec. 142, effective January 1, 1989.

KRS 271B.14-070 Unknown claims against dissolved corporation

271B.14-070. Unknown claims against dissolved corporation (1) A dissolved corporation may also publish notice of its dissolution and request that persons with claims against the corporation present them in accordance with the notice. (2) The notice shall: (a) Be published one (1) time in a newspaper of general circulation in the county where the dissolved corporation's principal office (or, if none in this state, its registered office) is or was last located; (b) Describe the information that must be included in a claim and provide a mailing address where the claim may be sent; and (c) State that a claim against the corporation will be barred unless a proceeding to enforce the claim is commenced within two (2) years after the publication of the notice. (3) If the dissolved corporation publishes a newspaper notice in accordance with subsection (2) of this section, the claim of each of the following claimants shall be barred unless the claimant commences a proceeding to enforce the claim against the dissolved corporation within two (2) years after the publication date of the newspaper notice: (a) A claimant who did not receive written notice under KRS 271B.14-060; (b) A claimant whose claim was timely sent to the dissolved corporation but not acted on; and (c) A claimant whose claim is contingent or based on an event occurring after the effective date of dissolution. (4) A claim may be enforced under this section: (a) Against the dissolved corporation, to the extent of its undistributed assets; or (b) If the assets have been distributed in liquidation, against a shareholder of the dissolved corporation to the extent of his pro rata share of the claim or the corporate assets distributed to him in liquidation, whichever is less, but a shareholder's total liability for all claims under this section shall not exceed the total amount of assets distributed to him. Effective: January 1, 1989 History: Created 1988 Ky. Acts ch. 23, sec. 143, effective January 1, 1989.

KRS 271B.14-200 Repealed, 2011

271B.14-200. Repealed, 2011 Catchline at repeal: Grounds for administrative dissolution. History: Amended 2010 Ky. Acts ch. 133, sec. 7, effective July 15, 2010; and repealed ch. 151, sec. 151, effective January 1, 2011. -- Created 1988 Ky. Acts ch. 23, sec. 144, effective January 1, 1989.

KRS 271B.14-210 Repealed, 2011

271B.14-210. Repealed, 2011 Catchline at repeal: Procedure for and effect of administrative dissolution. History: Repealed and reenacted 2010 Ky. Acts ch. 51, sec. 69, effective July 15, 2010; amended ch. 133, sec. 8, effective July 15, 2010; and repealed ch. 151, sec. 151, effective January 1, 2011. -- Amended 2007 Ky. Acts ch. 137, sec. 69, effective June 26, 2007. -- Created 1988 Ky. Acts ch. 23, sec. 145, effective January 1, 1989.

KRS 271B.14-220 Repealed, 2011

271B.14-220. Repealed, 2011 Catchline at repeal: Reinstatement following administrative dissolution or revocation under prior law -- Exception -- Amendment to extend or delete period of duration. History: Repealed and reenacted 2010 Ky. Acts ch. 51, sec. 70, effective July 15, 2010; amended ch. 133, sec. 9, effective July 15, 2010; and repealed ch. 151, sec. 151 effective January 1, 2011. -- Amended 2007 Ky. Acts ch. 62, sec. 1, effective July 1, 2008; and ch. 137, sec. 70, effective June 26, 2007. -- Amended 2005 Ky. Acts ch. 85, sec. 668, effective June 20, 2005. -- Amended 1992 Ky. Acts ch. 161, sec. 1, effective April 1, 1992. -- Created 1988 Ky. Acts ch. 23, sec. 146, effective January 1, 1989.

KRS 271B.14-225 Permissibility of merger of subsequent reincorporation with reinstated prior corporation -- Effect

271B.14-225. Permissibility of merger of subsequent reincorporation with reinstated prior corporation -- Effect The General Assembly finds and declares it to be the public policy of the Commonwealth of Kentucky that each corporation which was refused reinstatement either orally or in writing and subsequently reincorporated as a second corporation may reinstate the first corporation and merge the second corporation into the first corporation. The first corporation shall then be treated as if it had continuous and uninterrupted existence and that the administrative dissolution or revocation had never occurred. Effective: April 1, 1992 History: Created 1992 Ky. Acts ch. 161, sec. 3, effective April 1, 1992.

KRS 271B.14-230 Repealed, 2011

271B.14-230. Repealed, 2011 Catchline at repeal: Appeal from denial of reinstatement. History: Repealed 2010 Ky. Acts ch. 151, sec. 151, effective January 1, 2011. -- Amended 1992 Ky. Acts ch. 161, sec. 2, effective April 1, 1992. -- Created 1988 Ky. Acts ch. 23, sec. 147, effective January 1, 1989.

KRS 271B.14-300 Grounds for judicial dissolution

271B.14-300. Grounds for judicial dissolution The Circuit Court may dissolve a corporation: (1) In a proceeding by the Attorney General if it is established that: (a) The corporation obtained its articles of incorporation through fraud; or (b) The corporation has continued to exceed or abuse the authority conferred upon it by law; (2) In a proceeding by a shareholder if it is established that: (a) The directors are deadlocked in the management of the corporate affairs, the shareholders are unable to break the deadlock, and irreparable injury to the corporation is threatened or being suffered, or the business and affairs of the corporation can no longer be conducted to the advantage of the shareholders generally, because of the deadlock; (b) The directors or those in control of the corporation have acted, are acting, or will act in a manner that is illegal or fraudulent; or (c) The shareholders are deadlocked in voting power and have failed, for a period that includes at least two (2) consecutive annual meeting dates, to elect successors to directors whose terms have expired; (3) In a proceeding by a creditor if it is established that: (a) The creditor's claim has been reduced to judgment, the execution on the judgment returned unsatisfied, and the corporation is insolvent; or (b) The corporation has admitted in writing that the creditor's claim is due and owing and the corporation is insolvent; or (4) In a proceeding by the corporation to have its voluntary dissolution continued under court supervision. Effective: January 1, 1989 History: Created 1988 Ky. Acts ch. 23, sec. 148, effective January 1, 1989.

KRS 271B.14-310 Procedure for judicial dissolution

271B.14-310. Procedure for judicial dissolution (1) Venue for a proceeding by the Attorney General to dissolve a corporation shall lie in Franklin County. Venue for a proceeding brought by any other party named in KRS 271B.14-300 shall lie in the county where a corporation's principal office (or, if none in this state, its registered office) is or was last located. (2) It shall not be necessary to make shareholders parties to a proceeding to dissolve a corporation unless relief is sought against them individually. (3) A court in a proceeding brought to dissolve a corporation may issue injunctions, appoint a receiver or custodian pendente lite with all powers and duties the court directs, take other action required to preserve the corporate assets wherever located, and carry on the business of the corporation until a full hearing can be held. Effective: January 1, 1989 History: Created 1988 Ky. Acts ch. 23, sec. 149, effective January 1, 1989.

KRS 271B.14-320 Receivership or custodianship

271B.14-320. Receivership or custodianship (1) A court in a judicial proceeding brought to dissolve a corporation may appoint one (1) or more receivers to wind up and liquidate, or one (1) or more custodians to manage, the business and affairs of the corporation. The court shall hold a hearing, after notifying all parties to the proceeding and any interested persons designated by the court, before appointing a receiver or custodian. The court appointing a receiver or custodian shall have exclusive jurisdiction over the corporation and all of its property wherever located. (2) The court may appoint an individual or a domestic or foreign corporation (authorized to transact business in this state) as a receiver or custodian. The court may require the receiver or custodian to post bond, with or without sureties, in an amount the court directs. (3) The court shall describe the powers and duties of the receiver or custodian in its appointing order, which may be amended from time to time. Among other powers: (a) The receiver: 1. May dispose of all or any part of the assets of the corporation wherever located, at a public or private sale, if authorized by the court; and 2. May sue and defend in his own name as receiver of the corporation in all courts of this state; and (b) The custodian may exercise all of the powers of the corporation, through or in place of its board of directors or officers, to the extent necessary to manage the affairs of the corporation in the best interests of its shareholders and creditors. (4) The court during a receivership may redesignate the receiver a custodian, and during a custodianship may redesignate the custodian a receiver, if doing so is in the best interests of the corporation, its shareholders, and creditors. (5) The court from time to time during the receivership or custodianship may order compensation paid and expense disbursements or reimbursements made to the receiver or custodian and his counsel from the assets of the corporation or proceeds from the sale of assets. Effective: January 1, 1989 History: Created 1988 Ky. Acts ch. 23, sec. 150, effective January 1, 1989.

KRS 271B.14-330 Decree of dissolution

271B.14-330. Decree of dissolution (1) If after a hearing the court determines that one (1) or more grounds for judicial dissolution described in KRS 271B.14-300 exist, it may enter a decree dissolving the corporation, and the clerk of the court shall deliver a certified copy of the decree to the Secretary of State, who shall file it. The dissolution shall be effective upon the latter of the filing of the decree by the Secretary of State or such later date as is specified in the decree. (2) The effect of the dissolution shall be as set forth in KRS 271B.14-050. (3) After entering the decree of dissolution, the court shall direct the winding up and liquidation of the corporation's business and affairs, including as provided in KRS 271B.14-320, and the notification of claimants in accordance with KRS 271B.14- 060 and 271B.14-070. Effective: July 12, 2012 History: Amended 2012 Ky. Acts ch. 81, sec. 96, effective July 12, 2012. -- Amended 2011 Ky. Acts ch. 29, sec. 10, effective June 8, 2011. -- Created 1988 Ky. Acts ch. 23, sec. 151, effective January 1, 1989.

KRS 271B.14-400 Deposit with State Treasurer

271B.14-400. Deposit with State Treasurer Assets of a dissolved corporation that should be transferred to a creditor, claimant, or shareholder of the corporation who cannot be found or who is not competent to receive them shall be reduced to cash and deposited with the State Treasurer or other appropriate state official for safekeeping. When the creditor, claimant, or shareholder furnishes satisfactory proof of entitlement to the amount deposited, the State Treasurer or other appropriate state official shall pay him or his representative that amount. Effective: January 1, 1989 History: Created 1988 Ky. Acts ch. 23, sec. 152, effective January 1, 1989.

Source: Kentucky Legislative Research Commission (legislature.ky.gov)URL: https://apps.legislature.ky.gov/law/statutes/chapter.aspx?id=38552Fetched: 10/20/2026