Nebraska § 21-2981.02 - Limit on distributions.
Full text of Nebraska Revised Statutes of Nebraska § 21-2981.02 — Limit on distributions., with citation guidance and answers to common questions.
§ 21-2981.02. Limit on distributions.
(1) A limited cooperative association shall not make a distribution if, after the distribution:
(a) The limited cooperative association would not be able to pay its debts as they become due in the ordinary course of the association's activities; or
(b) The limited cooperative association's assets would be less than the sum of its total liabilities.
(2) A limited cooperative association may base a determination that a distribution is not prohibited under subsection (1) 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 methods that are reasonable in the circumstances.
(3) Except as otherwise provided in subsection (4) of this section, the effect of a distribution allowed under subsection (2) of this section is measured:
(a) In the case of distribution by purchase, redemption, or other acquisition of financial rights in the limited cooperative association, as of the date money or other property is transferred or debt is incurred by the association; and
(b) In all other cases, as of the date:
(i) The distribution is authorized, if the payment occurs within one hundred twenty days after that date; or
(ii) The payment is made, if payment occurs more than one hundred twenty days after the distribution is authorized.
(4) If indebtedness is issued as a distribution, each payment of principal or interest on the indebtedness is treated as a distribution, the effect of which is measured on the date the payment is made.
(5) For purposes of this section, distribution does 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.
Frequently Asked Questions About Nebraska § 21-2981.02
What does Revised Statutes of Nebraska § 21-2981.02 cover?
Section 21-2981.02 ("Limit on distributions.") is part of the Revised Statutes of Nebraska, the codified statutory law of Nebraska. 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 Nebraska § 21-2981.02?
A common citation format is "Revised Statutes of Nebraska § 21-2981.02" (Nebraska). 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 Nebraska law?
No. This page is for research and education and may not include the most recent amendments. For official current law, check the Nebraska official source linked on this page or consult a licensed Nebraska attorney.
How does Nebraska § 21-2981.02 apply to my situation?
Statutes are interpreted in context, and application depends on your specific facts. Only a licensed attorney in Nebraska 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 Nebraska.