corporate-law incorporation
Any jurisdiction - can a company self-destruct with a by-law?
<p>Would it be possible for a corporation or not-for-profit organization to legally include a self-destruct clause in founders agreement, by-laws, or similar binding agreement, one that can not or is unlikely to be superseded by another authority?</p>
<p><strong>For example,</strong></p>
<ol>
<li>Bob and Alice register an organization (non-profit or for-profit)</li>
<li>Bob and Alice both agree the purpose of the organization is X</li>
<li>Bob and Alice both <em>explicitly</em> agree that deviation from the initial purpose or change of ownership of the organization in a way that would inevitably lead to such deviation should trigger the organization to dissolve, and assets be split in manner Y.</li>
</ol>
<p>Now let's assume Bob transfers his ownership or something similar happens that is likely to result in change of direction for the org, how likely it is that such clauses be overturned somehow? Can this be done in a way that prevents boards and similar bodies from removing such clauses in a &quot;more-likely-to-be-upheld&quot; manner?</p>
<p>I am interested in EU and US, so feel free to answer according to your geographical area of expertise. This is not a real scenario, just a legal thought I am entertaining at the moment.</p>

<p>Many U.S. jurisdictions recognize that an entity may be of limited duration dissolving at a certain date or upon the happening of a certain event, and there are ways that amendments to prevent that term from being removed can be protected absent unanimous support of the owners.</p>
<p>In modern commercial practice, this is usually done for joint ventures or real estate development projects for which a specific limited term objective is contemplated or a one shot venture like producing a particular movie or concert tour. For example, a company might be formed to build a block full of town houses and to sell them to third-party buyers.</p>
<p>In non-profit practice, this usually involves a non-profit established for a specific event, such as an election campaign, or a academic conference, or an Olympics style sports event, or developing a vaccine on a contract basis.</p>
<p>In between, a limited term entity might also be formed, for example, to handle assets owned by a receiver or a probate estate in a jurisdiction outside the one where the receiver or executors has authority directly from an appointing court. This might be expressly limited to the duration of the receivership or probate estate administration.</p>
<p>Generally speaking, however, dissolution of an entity does not actually cause the entity to cease to exist. Instead, it causes the entity's management to be restricted by law to limiting its operations to winding up the company and distributing its assets in accordance with the law. If the management fails to do so, the usual remedy would be to have a court appoint a liquidator to wind up the affairs of the dissolved entity.</p>
