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Grex > Coop > #256: Has the time come to consider dissolving the corporation? | |
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| Author |
Message |
| 25 new of 75 responses total. |
kentn
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response 44 of 75:
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Feb 16 19:30 UTC 2013 |
Well, I know that was tongue in cheek, but yes, talk of shutting down
will scare people off from using Grex (if they see these items) and
it will get harder to field a Board. Shooting our organization in
the foot repeatedly is not a good way to insure survival.
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mary
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response 45 of 75:
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Feb 16 21:31 UTC 2013 |
Calm down, Rane. Really.
In the beginning we had an attorney draw up our Articles of Incorporation.
They are pretty boilerplate. If I remember correctly they outline what has
to be done to dissolve our organization and disperse any assets.
I'd look it up for you but I'm both lazy and on vacation.
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gelinas
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response 46 of 75:
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Feb 16 22:00 UTC 2013 |
Don't bother, Mary: Article 8 of the Bylaws is quoted in the text of this
item.
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denise
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response 47 of 75:
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Feb 17 03:56 UTC 2013 |
I don't see the point of dissolving Grex at this point in time. As said
in an item in Agora, we have equipment that is currently working and in
a place that we don't have to pay for. And we're still doing ok
financially.
Yes, there are issues and changes need to be made. Granted, there's
always someone who won't want whatever it is that someone proposes but
if it has potential to be of use for the users here and doesn't pose
problems, testing it out could be beneficial, even when we don't get
100% approval.
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rcurl
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response 48 of 75:
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Feb 18 21:24 UTC 2013 |
Re #45: I was just stating the obvious, Mary, as others were oversimplifying
the matter.
Re #46: Article 8 of the Bylaws is invalid, as the Article 6(4) of the
Articles of Incorporation rule. However the summary in the Bylaws don't
contradict the Articles, it is just less complete.
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richard
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response 49 of 75:
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Feb 18 22:14 UTC 2013 |
Or perhaps when article 8 of the bylaws was ratified, it conveyed the
ultimate desire of the membership to, when the time to dissolve came, to
drop its legal 501(3)(c) status and be able to legally sell its assets.
The Articles clearly recognize the potentiality of grex converting to a
private foundation. Since Article 8 of the bylaws was properly adopted by
the members, you could argue that it signifies that cyberspace
communications *must*, in order to comply, convert before dissolving.
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rcurl
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response 50 of 75:
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Feb 19 04:47 UTC 2013 |
If a non-profit drops its 501(c)3 status, it will owe all the taxes it did
not previously pay on its income.
To be more direct: Article 8 in the bylaws is illegal and cannot be
acted upon. There is a procedure for amending the Articles, which is
much more difficult than amending the bylaws. Hence a bylaw cannot
"amend" (control, affect, etc) the Articles.
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tonster
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response 51 of 75:
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Feb 19 14:45 UTC 2013 |
I'm not sure that makes sense. A 501(c)3 owes all taxes it didn't pay
for the entire time it had 501(c)3 by converting to a for-profit?
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rcurl
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response 52 of 75:
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Feb 19 21:22 UTC 2013 |
"Organizations That Are Not Private Foundations /*/ Cannot Voluntarily
Relinquish Their Exempt Status"
eotopick85.pdf
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tonster
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response 53 of 75:
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Feb 20 02:02 UTC 2013 |
Thanks for that useless bit of information.
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gelinas
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response 54 of 75:
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Feb 21 03:57 UTC 2013 |
The discussion of dissolution in Item 338 has been interesting, if misplaced.
Selling the hardware to someone else to continue operating as 'grex' would
probably not satisfy the requirements of dissolution. Selling the hardware
for fair market value, with any associated software that could be legally
transferred, would probably be acceptable. However, it would be easiest to
wipe the disks before sale, and then let the new owner do whatever they like
with the hardware. If that owner chose to re-install most of the software,
reconnect to the Internet, and open the box to all comers, they would, in my
opinion, be legally able to do so. They could, even, re-register the
existing domain names. I would guess, though, that the new owners would
prefer to abandon any baggage associated with the current names.
The proceeds of such sale would, of course, have to be distributed to another
charitable organisation, along with any other cash on hand.
The only other 'asset' I can think of are the records of the coporation.
These records could be destroyed, but I don't know how long they would have
to be maintained before destruction, nor who would be responsible for storing
them.
The harmful potential I see is a 'sham sale.' Selling the hardware, software
and etc to allow another to continue on without the Corporation would
probably not be valid. Especially for the one dollar I suggested.
Here is a question for the Treasurer, or the Keeper of the Treasury Records:
Were any donations of hardware or services acknowledged? Did the donor or
donors receive a tax benefit for the donation or donations?
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richard
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response 55 of 75:
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Feb 25 22:23 UTC 2013 |
re #54 It wouldn't be a 'sham sale' if the board woted to accept a fair
offer from another individual who has agreed to continue operating grex.
The board has the responsibility to act in the best interests of the
community, and if they voted to ignore the one way presented to keep the
community going, they would be in violation of their duties as board
members.
Further if the board concludes that it can longer properly run a 501(3)(c)
and that at the same time their is interest in keeping the community
going, it would be the only responsible thing to do.
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rcurl
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response 56 of 75:
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Feb 26 20:45 UTC 2013 |
Selling the hardware would violate the corporations purposes as stated
in its Articles. And a 501(C)3 exemption can't be transferrred so easily
as a "sale" to someone (I don't know at the moment if/how such a
transfer would be made.)
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gelinas
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response 57 of 75:
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Feb 26 22:55 UTC 2013 |
Rane, selling the hardware would only violate the Articles of Incorporation
if CC were to continue. Selling the hardware and donating the money realised
is a reasonable procedure when closing down.
But it begins to look like we won't be shutting down any time soon, so the
issue is moot.
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cross
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response 58 of 75:
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Feb 27 14:39 UTC 2013 |
Begins? I don't understand why anyone thought that was necessary in the first
place.
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gelinas
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response 59 of 75:
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Feb 27 20:04 UTC 2013 |
I know you don't, Dan; you seem to not differentiate between grex, the
machine/system, and Cyberspace Comunications, the corporation. The former
just needs electricty and a network connection. The latter needs people, to
fill the Directorships at least.
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cross
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response 60 of 75:
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Feb 27 20:16 UTC 2013 |
resp:59 Actually, no: our free colocation is predicated on the existance of
cyberspace communications, Inc. I'm well aware of the difference between the
two; after all, I was the guy who, a few years ago, started purposely trying
to differentiate between the two. But what you don't appear to appreciate,
Joe, is that one's existence is in large part dependent on the other.
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gelinas
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response 61 of 75:
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Feb 27 22:37 UTC 2013 |
Did a negative drop from that last sentence, Dan?
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cross
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response 62 of 75:
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Feb 27 23:53 UTC 2013 |
No.
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gelinas
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response 63 of 75:
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Feb 28 00:35 UTC 2013 |
Then I don't see what we are disagreeing about: grex can't exist without CC,
and CC can't exist without grex. And, still, CC can't exist without members.
Is the disagreement in whether CC members have to actively participate in the
governance of CC, including voting for and serving as Directors?
Or is the disagreement in what constitutes member participation?
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cross
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response 64 of 75:
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Feb 28 01:09 UTC 2013 |
resp:63 Do you remember writing this in resp:59, Joe?
"I know you don't, Dan; you seem to not differentiate between grex,
the machine/system, and Cyberspace Comunications, the corporation.
The former just needs electricty and a network connection. The
latter needs people, to fill the Directorships at least."
In resp:60, I am referring specifically to the, "the former just
needs electricty [sic] and a network connection" part and saying
that that is not, in fact, true. I suppose in some strict literal
way it is; the computer Grex is independent of the abstract
entity of Cyberspace Communications Inc., but *operating* it is very
much tied to the corporation
In resp:63, you seem to contradict what you had said in resp:59
vis-a-vis Grex's the system needing only electricity and a network
connection.
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gelinas
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response 65 of 75:
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Feb 28 02:29 UTC 2013 |
I'm not contradicting myself; I don't think you are contradicting yourself.
We simply don't understand what the other is saying.
grex is a computer, a machine with certain software installed. It exists
whether people use it or not. When people stop using it, then the people who
maintain it no longer have a reason to keep it turned on. The maintainers
may want to keep it turned on, or they may want to turn it off before people
stop using it. But grex remains a computer.
Cyberspace Communications is a corporation which exists primarily, if not
solely, to operate the machine 'grex.' Cyberspace Communication needs people
to maintain the computer known as 'grex.' It also needs people to fufill the
day to day tasks of a corporation: paying the bills, deciding what the
corporation is going to do, appointing people to maintain grex, and such
like. Even if there are no bills to pay, the corporation still has things to
do.
As long as grex has electricity and a network connection, it can continue to
operate. It may not have a reason to operate, but it can.
CC is different. It can only continue to function as long as people care
enough to devote time and energy to it. If there are no people, there is no
corporation. If there is no corporation, then who is going to maintain the
machine?
Is this where we part company? Users are not members. The difference
between a 'user' and a 'member' is that the member will devote time and
energy to the maintenance of the Corporation. Only members can be directors.
Realistically, only members are *interested* in being directors.
Our problem is not that people are not using grex. Our problem is that
people are not becoming members of the corporation.
It's not a matter of paying money. It's a matter of paying time. Right now,
we use paying money to identify those willing to pay time. Maybe there is a
better way to identify them.
Note that a staff member can belong to either group, as the staff member
chooses.
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rcurl
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response 66 of 75:
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Feb 28 22:08 UTC 2013 |
"And, still, CC can't exist without members."
It can if it converts to a board-based non-profit. Of course, it still needs
users to have any point for existence.
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gelinas
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response 67 of 75:
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Mar 1 02:43 UTC 2013 |
The only reason to convert to a board-based non-profit is that we can't muster
the members to continue as a member-based non-profit, which brings us right
back to the membership being unable to support the corporation, which leads
to dissolution.
Switching to a board-based corporation solves nothing.
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cross
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response 68 of 75:
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Mar 1 21:42 UTC 2013 |
resp:67 No, it doesn't lead to dissolution. It *may*, but that is not
necessarily so. It can, as Rane points out, lead to a board-based non-profit
with users.
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