Section 10A-20-10.01

Restrictions; powers of courts and Attorney General not impaired.

(a) Notwithstanding any provision to the contrary in the certificate of formation, other governing instrument, or under any other law of this state, and except as otherwise provided by court order, or by a provision in the certificate of formation or other governing instrument, which in either case is entered or made after August 11, 1971, and expressly limits the applicability of this section, a corporation which is, or is treated as, a private foundation, as defined in Section 509 of the Internal Revenue Code of 1954, during the period it is, or is treated as, a private foundation:

(1) Shall not engage in any act of self-dealing as defined in Section 4941 (d) thereof;

(2) Shall distribute, for the purposes specified in its certificate of formation, for each taxable year not less than the amounts at the time and in the manner as not to become subject to the tax on undistributed income imposed by Section 4942 thereof;

(3) Shall not, if Section 4943 thereof is applicable, retain any excess business holdings as defined in subsection (c) of that section beyond the period permitted by that section;

(4) Shall not make any investment in a manner as to subject it to tax under Section 4944 thereof; and

(5) Shall not make any taxable expenditures as defined in Section 4945 (d) thereof.

(b) Nothing in this section shall impair the rights and powers of the courts or the Attorney General of this state with respect to any corporation described in this section. The provisions of this section shall not apply to any corporation to the extent that a court of competent jurisdiction shall determine that the application would be contrary to the terms of the certificate of formation or other instrument governing the corporation or governing the administration of charitable funds held by it and that the same may not properly be changed to conform to this section.

(c) All references to sections of the Internal Revenue Code of 1954 shall include future amendments to the sections and corresponding provisions of future internal revenue laws.

(Acts 1971, No. 230, p. 533, §§1-3; Acts 1971, No. 2275, p. 3664, §§1-3; §10-4-210; amended and renumbered by Act 2009-513,p. 967, §342.)