Outline for Alaska Corporate Dissolution.

A. Corporation Has Not Issued Stock or Commenced Business.

1. If the corporation has not issued stock and has not commenced business, a voluntary dissolution may be authorized by a majority of the incorporators.

B. Corporation has issued stock or has commenced business.

1. If the corporation has issued stock and has commenced business, the approval of the shareholders is required for voluntary dissolution of the corporation.

2. Shareholder approval is obtained as follows:

a. The board of directors of the corporation adopts a plan of liquidation and refers the plan to the shareholders for action.

b. A majority of shareholders, and a majority of the holders of each class of shares entitled to vote as a class, approve the plan of liquidation.

II. Filings and Notice.

A. Filings.

1. Under the Alaska Business Corporation Act, a Certificate of Election to dissolve is filed initially with the Alaska Corporations Commissioner. Articles of dissolution are filed after the completion of the winding up and liquidation of the corporation. A.S. 10.06.608.

2. Articles of dissolution stating compliance with A.S. 10.06.620. A.S. 10.06.623.

B. Revocation.

1. The dissolution may be revoked prior to any actual distributions to shareholders under A.S. 10.06.610.

2. Revocation of dissolution is effective on filing.

C. Notice.

1. The corporation must give notice of the dissolution to holders of known claims against the corporation. The notice must provide for a procedure and deadline for filing claims against the corporation. See, A.S. 10.06.615 and .620

2. In order to notify holders of unknown claims, notice of the dissolution is published by the corporation in a newspaper. See, A.S. 10.06.653 (The heading discusses publication issues in the context of court and non-court directed winding up of the enterprise. However, the actual provisions only discuss court winding up.) This notice must also provide for a procedure for filing claims against the corporation.

D. Effect. The effect of dissolution is to cease the existence of the enterprise for all purposes other than suits, legal proceedings and actions by shareholders, directors and officers. A.S. 10.06.625.

III. Winding Up and Liquidation.

A. Cessation of Business.

1. The operation of the business of the corporation must cease on or before the filing of certificate of intent to terminate, except as necessary to wind up the business operations and preserve good will. A.S. 10.06.615.

2. The only continuing activity of the corporation should be that necessary to wind up its affairs and distribute its assets in liquidation.

B. Assemble Assets.

1. The corporation must assemble its assets and sell or otherwise dispose of those assets that will not be distributed to shareholders or to claimants.

2. Particular care should be given to identifying assets such as prepaid items and contingent claims that might otherwise be overlooked.

C. Satisfy Obligations and Liabilities.

1. The corporation must pay or provide for payment of all corporate obligations and liabilities and all claims against the corporation.

2. In the case of disputed or contingent claims, provision may be made for payment by depositing funds into an escrow or liquidating trust.

D. Distribution to Shareholders.

1. The assets of the corporation remaining after payment of or providing for claims should be distributed to the shareholders.

2. All known assets should be transferred with appropriate forms of transfer or conveyance, such as deeds, bills of sale, or assignments.

3. Unknown assets can be transferred to shareholders by an assignment specifically covering such assets.

4. A statement of the fair market value of all assets transferred should be provided by the corporation to each shareholder. This statement will be required for the shareholders’ income tax returns.

E. Stock Certificates.

1. All stock certificates of the corporation should be collected and canceled.

2. Stock certificates should be collected from shareholders in exchange for the assets distributed to them.

F. Timing.

1. If installment obligations of the corporation will be distributed in the liquidation, the liquidation should be completed within 12 months following the adoption of the plan of liquidation to enable noncorporate shareholders to report gain attributable to the installment obligations on the installment basis.

2. In other cases, the liquidation should proceed as quickly as possible. A protracted liquidation may result in the corporation’s being subjected to personal holding company or accumulated earnings taxes.

IV. Tax Filings.

A. Corporation.

1. Form 966 must be filed by the corporation with the Internal Revenue Service within 30 days after adoption of the plan of complete liquidation.

2. Forms 1099-DIV must be issued to all shareholders who have received $600 or more in the liquidation by January 31 of the year following the liquidation, and copies of these forms must be filed with the Internal Revenue Service, accompanied by Form 1096.

3. The corporation’s final income tax return must be filed by the 15th day of the third month following the close of its final tax year, which will generally be the date on which its assets are distributed to shareholders.

B. Shareholders.

1. Shareholders must report any gain or loss on the liquidation on their income tax returns for the year in which the liquidation occurs. If the shareholders have a loss, it may qualify as an ordinary loss under IRC §1244.

2. Shareholders must file certain information regarding the liquidation with those returns.

The following is my Outline for Corporate Dissolution.

A. Corporation Has Not Issued Stock or Commenced Business.

1. If the corporation has not issued stock and has not commenced business, a voluntary dissolution may be authorized by a majority of the incorporators under the Model Business Corporation Act.

2. If the corporation has not issued stock or has not commenced business, a voluntary dissolution may be authorized by a majority of the incorporators or by a majority of the members of the initial board of directors under the Revised Model Business Corporation Act.

B. Corporation has issued stock or has commenced business.

1. If the corporation has issued stock and has commenced business, the approval of the shareholders is required for voluntary dissolution of the corporation. Under the Model Business Corporation Act, shareholder approval is required if the corporation has either issued stock or commenced business.

2. Shareholder approval is obtained as follows:

a. The board of directors of the corporation adopts a plan of liquidation and refers the plan to the shareholders for action.

b. A majority of shareholders, and a majority of the holders of each class of shares entitled to vote as a class, approve the plan of liquidation.

II. Filings and Notice.

A. Filings.

2. Articles of dissolution stating compliance with A.S. 10.06.620. A.S. 10.06.623.

B. Revocation.

1. The dissolution may be revoked prior to any actual distributions to shareholders under A.S. 10.06.610.

2. Revocation of dissolution is effective on filing.

C. Notice.

III. Winding Up and Liquidation.

A. Cessation of Business.

2. The only continuing activity of the corporation should be that necessary to wind up its affairs and distribute its assets in liquidation.

B. Assemble Assets.

1. The corporation must assemble its assets and sell or otherwise dispose of those assets that will not be distributed to shareholders or to claimants.

2. Particular care should be given to identifying assets such as prepaid items and contingent claims that might otherwise be overlooked.

C. Satisfy Obligations and Liabilities.

1. The corporation must pay or provide for payment of all corporate obligations and liabilities and all claims against the corporation.

2. In the case of disputed or contingent claims, provision may be made for payment by depositing funds into an escrow or liquidating trust.

D. Distribution to Shareholders.

1. The assets of the corporation remaining after payment of or providing for claims should be distributed to the shareholders.

2. All known assets should be transferred with appropriate forms of transfer or conveyance, such as deeds, bills of sale, or assignments.

3. Unknown assets can be transferred to shareholders by an assignment specifically covering such assets.

E. Stock Certificates.

1. All stock certificates of the corporation should be collected and canceled.

2. Stock certificates should be collected from shareholders in exchange for the assets distributed to them.

F. Timing.

IV. Tax Filings.

A. Corporation.

1. Form 966 must be filed by the corporation with the Internal Revenue Service within 30 days after adoption of the plan of complete liquidation.

B. Shareholders.