Tennessee Code Title 6. Cities and Towns § 6-1-305

(a) In case of a reversion to a former charter or adoption of a new one simultaneously with the surrender of the old, all assets, liabilities and obligations of the old municipality shall become those of the new municipality.

(b) In the event a municipality reverts to unincorporated status, the board of mayor and aldermen shall become trustees of the property and funds of the former municipality, and, under such bonds as may be required by the county legislative body, shall proceed to terminate the affairs of the municipality and dispose of its property.