What happens if a corporation's assets exceed its liabilities upon dissolution?

Upon the dissolution of a corporation, if its assets exceed its liabilities, the remaining assets are distributed to shareholders according to their ownership interests. This is a fundamental principle of corporate law, which dictates that after satisfying all debts and obligations, any excess assets belong to the shareholders. The distribution follows the hierarchy and rights outlined in the corporate charter and bylaws, usually on a pro-rata basis relative to the shares held.

Shareholders are entitled to receive the value left in the corporation after all creditors have been paid, which reflects their ownership stake in the business. This distribution can happen in cash or through the transfer of remaining physical or financial assets.

Other alternatives provided do not align with typical corporate dissolution procedures. Immediate liquidation of assets or keeping assets for future use would not respect the rights of shareholders to the excess assets. Donating to charity is also not a standard requirement in corporate dissolutions and generally would not occur unless specified in the corporate charter or as a decision facilitated by the board of directors prior to dissolution.