(a) Property held in trust or otherwise dedicated to a charitable purpose may not be diverted from its purpose by a transaction described in § 48-62-101 or § 48-62-102 unless the corporation complies with subsection (c) to the extent required by and pursuant to the law of this state on cy pres or otherwise dealing with the nondiversion of charitable assets.
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Terms Used In Tennessee Code 48-62-103

  • Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
  • Charitable purpose: means a purpose that:
    (A) Would make a corporation operated exclusively for that purpose eligible to be exempt from taxation under Section 501(c)(3) of the Internal Revenue Code. See Tennessee Code 48-51-201
  • 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.
  • Court: includes every court and judge having jurisdiction in the case. See Tennessee Code 48-202-101
  • Entity: includes the following, whether foreign or domestic: LLCs. See Tennessee Code 48-202-101
  • Jurisdiction: (1) The legal authority of a court to hear and decide a case. Concurrent jurisdiction exists when two courts have simultaneous responsibility for the same case. (2) The geographic area over which the court has authority to decide cases.
  • Member: means a person reflected in the required records of an LLC as the owner of some governance rights of a membership interest of the LLC. See Tennessee Code 48-202-101
  • Person: includes individual and entity. See Tennessee Code 48-202-101
  • Property: includes both personal and real property. See Tennessee Code 1-3-105
  • Public benefit corporation: means a domestic corporation which becomes by operation of law a public benefit corporation pursuant to §. See Tennessee Code 48-51-201
  • Reporter: Makes a record of court proceedings and prepares a transcript, and also publishes the court's opinions or decisions (in the courts of appeals).
  • State: when applied to the different parts of the United States, includes the District of Columbia and the several territories of the United States. See Tennessee Code 1-3-105
  • written: means any information in the form of a document. See Tennessee Code 48-11-201
(b) A person who is a member or otherwise affiliated with a public benefit corporation may not receive a direct or indirect financial benefit in connection with a disposition of assets unless the person is a public benefit corporation or an unincorporated entity that has a charitable purpose. This subsection (b) does not apply to the receipt of reasonable compensation for services rendered.
(c) A public benefit corporation must give written notice to the attorney general and reporter at least forty-five (45) days before it sells, leases, exchanges or otherwise disposes of all, or substantially all, of its property in a transaction not in the usual and regular course of its activities unless the corporation obtains an appropriate order from the court of competent jurisdiction.
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