(a) A director who votes for or assents to a distribution in violation of this chapter or the articles of incorporation is personally liable to the corporation for the amount of the distribution that exceeds what could have been distributed without violating this chapter if the party asserting liability establishes that when taking the action the director did not comply with section eight hundred thirty of this article.
(b) A director held liable under subsection (a) of this section for an unlawful distribution is entitled to:
(1) Contribution from every other director who could be held liable under subsection (a) of this section for the unlawful distribution; and
(2) Recoupment from each recipient for the amount the recipient accepted, knowing the distribution was made in violation of this chapter or the articles of incorporation.
(c) A proceeding to enforce the liability of a director under subsection (a) of this section is barred unless it is commenced within two years after the date on which the distribution was made.
(d) For purposes of this section, a director is deemed to have voted for a distribution if the director was present at the meeting of the board of directors at the time the distribution was authorized and did not vote in dissent, or if the director consented to the vote pursuant to section eight hundred twenty-one of this article.
Copyright ©2024 LegalFix. All rights reserved. LegalFix is not a law firm, is not licensed to practice law, and does not provide legal advice, services, or representation. The information on this website is an overview of the legal plans you can purchase—or that may be provided by your employer as an employee benefit or by your credit union or other membership group as a membership benefit.
LegalFix provides its members with easy access to affordable legal services through a network of independent law firms. LegalFix, its corporate entity, and its officers, directors, employees, agents, and contractors do not provide legal advice, services, or representation—directly or indirectly.
The articles and information on the site are not legal advice and should not be relied upon—they are for information purposes only. You should become a LegalFix member to get legal services from one of our network law firms.
You should not disclose confidential or potentially incriminating information to LegalFix—you should only communicate such information to your network law firm.
The benefits and legal services described in the LegalFix legal plans are not always available in all states or with all plans. See the legal plan Benefit Overview and the more comprehensive legal plan contract during checkout for coverage details in your state.
Use of this website, the purchase of legal plans, and access to the LegalFix networks of law firms are subject to the LegalFix Terms of Service and Privacy Policy.