District Of Columbia § 29-1010.07 - Limitations on distributions.
Full text of District Of Columbia D.C. Code § 29-1010.07 — Limitations on distributions., with citation guidance and answers to common questions.
§ 29-1010.07. Limitations on distributions.
29-1010.07A limited cooperative association shall not make a distribution, including a distribution under if, after the distribution:
The association would not be able to pay its debts as they become due in the ordinary course of the association’s activities and affairs; or
The association’s total assets would be less than the sum of its total liabilities plus the amount that would be needed, if the association were to be dissolved and wound up at the time of the distribution, to satisfy the preferential rights upon dissolution and winding up of members whose preferential rights are superior to those of persons receiving the distribution.
A limited cooperative association may base a determination that a distribution is not prohibited under subsection (a) of this section on financial statements prepared on the basis of accounting practices and principles that are reasonable in the circumstances or on a fair valuation or other method that is reasonable in the circumstances.
Except as otherwise provided in subsection (d) of this section, the effect of a distribution allowed under subsection (b) of this section shall be measured:
In the case of distribution by purchase, redemption, or other acquisition of financial rights in the limited cooperative association, as of the earlier of the date money or other property is transferred or debt is incurred by the association or the date the person entitled to the distribution ceases to own the financial rights being acquired by the association in return for the distribution;
In the case of any other distribution of indebtedness, as of the date the indebtedness is distributed;
In all other cases, as of the date:
The distribution is authorized, if the payment occurs not later than 120 days after that date; or
The payment is made, if payment occurs more than 120 days after the distribution is authorized.
A limited cooperative association’s indebtedness incurred by reason of a distribution made in accordance with this section is at parity with the association’s indebtedness to its general, unsecured creditors except to the extent subordinated by agreement.
A limited cooperative association’s indebtedness, including indebtedness issued as a distribution, is not a liability for purposes of subsection (a) of this section if the terms of the indebtedness provide that payment of principal and interest is made only if and to the extent that payment of a distribution could then be made under this section. If the indebtedness is issued as a distribution, each payment of principal or interest on the indebtedness shall [be] treated as a distribution, the effect of which is measured on the date the payment is made.
In measuring the effect of a distribution under , the liabilities of a dissolved limited cooperative association do not include any claim that has been disposed of under §§ , ,09, and .
For purposes of this section, the term “distribution” shall not include reasonable amounts paid to a member in the ordinary course of business as payment or compensation for commodities, goods, past or present services, or reasonable payments made in the ordinary course of business under a bona fide retirement or other benefits program.
Annotations
Application of Law 19-210: Section 7 of provided that the act shall apply as of January 1, 2012.
Uniform Law: This section is based on § 1007 of the Uniform Limited Cooperative Association Act.
Source: official District Of Columbia text · Last verified 2026-08-27
Frequently Asked Questions About District Of Columbia § 29-1010.07
What does D.C. Code § 29-1010.07 cover?
Section 29-1010.07 ("Limitations on distributions.") is part of the D.C. Code, the codified statutory law of District Of Columbia. It sets out the legal rule or procedure described in the text above. Statutes are amended regularly, so always verify against the official source.
How do I cite District Of Columbia § 29-1010.07?
A common citation format is "D.C. Code § 29-1010.07" (District Of Columbia). Legal writing may require the code abbreviation, section number, and year or edition. Match the style required by your court, professor, or publisher.
Is this the official text of District Of Columbia law?
No. This page is for research and education and may not include the most recent amendments. For official current law, check the District Of Columbia official source linked on this page or consult a licensed District Of Columbia attorney.
How does District Of Columbia § 29-1010.07 apply to my situation?
Statutes are interpreted in context, and application depends on your specific facts. Only a licensed attorney in District Of Columbia can advise on how this section applies to you. Contact your state or local bar association for a referral.
Sources & Verification
Not legal advice. Verify against the official source and consult a licensed attorney in District Of Columbia.