KRS § 275.535 — KY Code / Title XXIII / Chapter 275 / Section 275.535
275.535 Procedure in liquidation of nonprofit limited liability company by court
Status: in_force

275.535 Procedure in liquidation of nonprofit limited liability company by court.

(1) In proceedings to liquidate the assets and affairs of a nonprofit limited liability

company, the court shall have the power to issue injunctions and to appoint a

receiver or receivers while the action is pending. The receivers shall have those

powers and duties as the court from time to time may direct, to take action to

preserve the corporate assets wherever situated, and to carry on the affairs of the

nonprofit limited liability company until a full hearing can be held.

(2) After holding a hearing, upon notice as the court may direct to be given to all parties

to the proceedings and to any other parties in interest designated by the court, the

court may appoint a liquidating receiver or receivers with authority to collect the

assets of the nonprofit limited liability company. The liquidating receiver or

receivers shall have authority, subject to the order of the court, to sell, convey, and

dispose of all or any part of the assets of the nonprofit limited liability company

wherever situated, either at public or private sale. The order appointing the

liquidating receiver or receivers shall state their powers and duties. The powers and

duties may be increased or diminished at any time during the proceedings.

(3) The assets of the nonprofit limited liability company or the proceeds resulting from

a sale, conveyance, or other disposition thereof shall be applied and distributed as

follows:

(a) All costs and expenses of the court proceedings and all liabilities and

obligations of the nonprofit limited liability company shall be paid, satisfied,

and discharged, or adequate provision for them shall be made;

(b) Assets held by the nonprofit limited liability company upon condition

requiring return, transfer, or conveyance, which condition occurs by reason of

the dissolution or liquidation, shall be returned, transferred, or conveyed in

accordance with the condition's requirements;

(c) Assets received and held by the nonprofit limited liability company subject to

limitations permitting their use only for a nonprofit purpose, but not held upon

a condition requiring return, transfer, or conveyance by reason of the

dissolution or liquidation, shall be transferred or conveyed to one (1) or more

domestic or foreign nonprofit limited liability companies, societies, or

organizations engaged in activities substantially similar to those of the

dissolving or liquidating nonprofit limited liability company, as the court may

direct; and

(d) Any remaining assets may be distributed to those persons, societies,

organizations, or domestic or foreign limited liability companies, whether for

profit or nonprofit, specified in the plan of distribution adopted or, if no plan

of distribution has been adopted, as the court may direct.

(4) The court shall have power to allow, from time to time, as expenses of the

liquidation, compensation to the receiver or receivers and to attorneys in the

proceeding, and to direct the payment thereof out of the assets of the nonprofit

limited liability company or the proceeds of any sale or disposition of the assets.

(5) A receiver of a nonprofit limited liability company appointed under the provisions

of this section shall have authority to sue and defend in all courts in the receiver's

own name as receiver of the nonprofit limited liability company. The court

appointing the receiver shall have exclusive jurisdiction of the nonprofit limited

liability company and its property, wherever situated.