Corporate Dividend and Distribution Requirements by State
Who may authorize a dividend or other shareholder distribution by an ordinary domestic private business corporation, what forms and charter or preference limits apply, which statutory financial tests control, and when must those tests be measured?
Jurisdictions
50 of 51 verified, 1 with no public source
Statutes checked
Every entry, oldest check September 3, 2026
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What this survey covers
A dividend is only one form of shareholder distribution. Many business- corporation acts use “distribution” for direct or indirect transfers of money or property and also reach repurchases, redemptions, other share acquisitions, or shareholder indebtedness. This survey begins with the authorizing body and transaction form, then keeps the financial source and solvency tests separate from record dates, measurement timing, class treatment, and distribution debt.
The table reports the statutory test without applying it to a balance sheet. It does not decide whether assets or liabilities were valued correctly, whether a corporation can pay debts, whether surplus or net profits exist, or whether a particular dividend is lawful, prudent, fair, or advisable.
Why the state architecture matters
Florida, the District of Columbia, Wyoming, and Rhode Island use a two-part post-distribution limit: the corporation must remain able to pay debts as they become due, and total assets cannot fall below total liabilities plus the amount needed for superior liquidation preferences unless the governing articles permit otherwise. Each permits reasonable financial statements or a fair valuation or another reasonable method, and each ordinarily measures an authorization when payment follows within 120 days. Rhode Island also lets a majority of the superior preference class waive the preference add-on while voting by class. Fla. Stat. § 607.06401, D.C. Code § 29-304.60, Wyo. Stat. § 17-16-640, and R.I. Gen. Laws § 7-1.2-614 (accessed September 4, 2026).
Delaware instead permits directors, subject to certificate restrictions, to declare dividends from surplus or, if there is no surplus, from current or preceding-fiscal-year net profits. Its net-profit route carries a separate capital-deficiency restriction for outstanding classes with a preference on asset distribution. 8 Del. C. § 170 (accessed September 4, 2026).
Scope boundaries
This is a comparison of statutory architecture, not a distribution calculator or solvency opinion. It does not determine a lawful amount, select an accounting or valuation method, interpret a debt covenant, classify tax consequences, test a director's conduct, trace a recipient's knowledge, or predict liability or recovery. The state cell supplies the current official text behind each table value; the corporation's complete governing and financial record still controls the transaction.
State by state
Every column answered the same way for each jurisdiction. Open a state for the full page, with the statute text and the date it was checked.
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| State | Governing law, entity, distribution, and scope | Board, committee, shareholder, and charter authority | Cash, property, shares, debt, repurchase, and redemption forms | Surplus, net-profit, equity, and capital-source test | Liquidity, balance-sheet, liability, and preference test | Financial statements, valuation, reserves, and reliance | Record date, measurement date, payment delay, and revocation | Class, series, equal treatment, stock distribution, and fractions | Distribution debt, priority, liquidation, insolvency, and boundaries |
|---|---|---|---|---|---|---|---|---|---|
| Alabama verified 2026-09-03 | Alabama Business Corporation Law, Ala. Code tit. 10A, ch. 2A; ordinary domestic business corporation. Distribution includes direct/indirect cash or property except own stock, debt, dividends, purchases, redemptions, acquisitions, and liquidation; § 10A-2A-6.40 expressly excludes Article 14 liquidation distributions (§§ 10A-2A-1.40, 10A-2A-6.40) |
Board authorizes subject to certificate and § 10A-2A-6.40(c). Committee may authorize/approve only by board-prescribed formula, method, or limits. No general stockholder approval; certificate/bylaws may constrain delegation (§§ 10A-2A-6.40, 10A-2A-8.25) |
Direct/indirect cash or other property except own stock, incurred debt, dividend payment, purchase, redemption, other acquisition, debt, liquidation, or otherwise (§ 10A-2A-1.40(6)); stock dividends under § 10A-2A-6.23; redemption may use cash, debt, securities, or property (§ 10A-2A-6.01(c)(2)) |
No separate surplus, retained-earnings, net-profit, stated-capital, or other capital-source test in § 10A-2A-6.40; Alabama uses the dual post-distribution limits plus certificate and class/series terms |
After distribution: corporation must be able to pay debts as due, and assets must be ≥ liabilities plus amount needed for superior dissolution preferences unless certificate permits otherwise (§ 10A-2A-6.40(c)) |
Board may use reasonable-in-circumstances accounting statements, fair valuation, or another reasonable method (§ 10A-2A-6.40(d)); qualified reliance on reliable officers/employees, retained experts, or trusted committee absent contrary knowledge (§ 10A-2A-8.30(d)–(f)); no reserve formula |
Board may fix nonretroactive record date; default is authorization except acquisitions. Acquisition: earlier transfer/debt or status end; other debt: distribution; other payments: authorization if ≤120 days, payment if later (§ 10A-2A-6.40(b), (e)); no general revocation rule or stated forward maximum |
Same-class/series terms identical except certificate may expressly vary among holders; certificate sets preferences (§ 10A-2A-6.01). Stock dividends pro rata; cross-class issue needs certificate, issuing-class majority, or no outstanding stock (§ 10A-2A-6.23). Fractions, value cash, disposition, or nonbearer scrip (§ 10A-2A-6.04) |
Compliant distribution debt is at parity with general unsecured debt unless subordinated. Conditional debt may be excluded from liabilities, with principal/interest retested when paid (§ 10A-2A-6.40(f)–(g)); Article 14 liquidation excluded; liability, creditor, bankruptcy, covenant, tax, valuation, and advice issues outside scope |
| Alaska verified 2026-09-04 | Alaska Corporations Code, especially AS 10.06.305-.383, .408, .450, .468, .970, .990; ordinary domestic for-profit corporation; covers corporation/subsidiary cash or property dividends, purchases, redemptions, sinking-fund transfers, and certain debt-for-share exchanges; own-share dividends separate; winding-up/dissolution proceedings excluded |
Board declares/approves; committee cannot declare dividends/distributions (§§ 10.06.450, .468). Articles may require shareholder approval (§ 10.06.210(1)(J)); articles, bylaws, indentures, and agreements may add dividend, purchase, or redemption restrictions (§ 10.06.375) |
Cash/property without consideration as dividend or otherwise; cash/property purchase or redemption; negotiable debt security exchanged for shares; sinking-fund transfer (§ 10.06.990(17)). Share dividends separately governed by §§ 10.06.355, .373; no general dividend-in-debt form stated |
Alternative 1: retained earnings immediately before distribution ≥ proposed amount. Alternative 2: filtered post-distribution assets ≥1.25× filtered liabilities plus applicable current-asset/current-liability test (§ 10.06.358). Junior dividend also needs retained earnings covering distribution plus senior cumulative arrears (§ 10.06.365); no surplus route |
Corporation and distributing subsidiary cannot be, or likely become, unable to meet liabilities as they mature (§ 10.06.360). Junior-class post-distribution filtered asset excess cannot be below superior liquidation preferences (§ 10.06.363); § 10.06.358 separately supplies filtered 1.25× and current-ratio tests |
Property distribution uses carrying value on compliant statements; § 10.06.358 allows GAAP or fair-and-reasonable accounting practices, deems GAAP fair/reasonable, and puts proof of other methods on corporation. Exchange profits require cash-realizable received assets; specified customer amounts may enter current assets after future-cost adjustment. Director reliance subject to § 10.06.450(b)-(c); no general fair-valuation or reserve route |
Board may close books ≤70 days or bylaws/board set record date ≤60 days before action; default dividend record date is declaration resolution date (§ 10.06.408). Dividend measured at declaration; purchase/redemption at transfer, debt-for-shares at acquisition, sinking fund at trustee delivery/segregation (§ 10.06.990(17)); no 120-day rule or general revocation |
Same class/series has same rights; articles may create dividend/liquidation preferences (§§ 10.06.305, .308). Cross-class share dividend requires articles or majority of outstanding shares of issued class (§ 10.06.373). Fractions or registered/bearer scrip allowed; fractions receive vote/dividend/liquidation rights, scrip only if stated (§ 10.06.355) |
No general priority or conditional distribution-debt rule; § 10.06.990(17) fixes timing when negotiable debt is exchanged for shares. Insured deceased-holder purchase/redemption exception in § 10.06.368. Finance sections do not apply in winding-up/dissolution proceedings (§ 10.06.383); creditor, fiduciary, tax, accounting, and valuation advice outside scope |
| Arizona verified 2026-09-03 | Arizona Business Corporation Act, A.R.S. §§ 10-140, 10-601 to -640; ordinary domestic for-profit corporation. Distribution covers direct/indirect money or property (not own shares), debt, dividends, purchases/redemptions/acquisitions, and otherwise; definition and § 10-640 state no express liquidation exclusion |
Board authorizes subject to articles (§ 10-640(A)). Committee cannot authorize distributions; it may approve reacquisition only by board-prescribed formula/method (§ 10-825(E)(1), (7)). Compliant all-shareholder agreement may alter authority/proportionality but remains subject to § 10-640 and ends on public trading (§ 10-732) |
Direct/indirect money or other property, indebtedness, dividend declaration/payment, purchase, redemption, other acquisition, or otherwise (§ 10-140(19)); own shares excluded from property branch but separately governed as share dividends (§ 10-623) |
No separate surplus, retained-earnings, net-profit, stated-capital, or capital-source test in § 10-640; Arizona uses its dual post-distribution limits, subject to articles and class/series terms |
After distribution: corporation must be able to pay debts as due, and total assets must be ≥ total liabilities plus amount needed for superior dissolution preferences unless articles permit otherwise (§ 10-640(C)) |
Board may use reasonable-in-circumstances statements—ordinarily GAAP or applicable regulatory principles absent special circumstances—or fair valuation/another reasonable method (§ 10-640(D)); qualified reliance on reliable officers/employees, experts, or trusted committee absent contrary knowledge (§ 10-830(B)-(C)); no special reserve formula |
Board may fix record date; default for nonacquisition distribution/share dividend is authorization date (§§ 10-640(B), 10-623(C)). Acquisition: earlier transfer/debt or status end; ordinary debt: distribution date; other payments: authorization if ≤120 days, payment if later; conditional-debt payments tested when paid (§ 10-640(E), (G)); no general revocation rule stated |
Same-class rights generally identical subject to § 10-602; articles set distribution preferences (§ 10-601). Share dividends pro rata by default; cross-class issue needs articles, majority class/series approval, or no outstanding shares (§ 10-623). Fraction certificates, fair-value cash, disposition arrangement, or conditional scrip (§ 10-604) |
Compliant distribution debt is at parity with general unsecured debt unless subordinated by agreement. Conditional-pay debt is excluded from liabilities and each payment retested (§ 10-640(F)-(G)). Core section states no special security or liquidation rule; financial application, liability, creditor, insolvency, liquidation, and advice questions outside scope |
| Arkansas verified 2026-09-04 | Ark. Code §§ 4-27-140(4), (6), 4-27-640; ordinary Arkansas domestic for-profit corporation. Distribution covers direct/indirect money or property, debt, dividends, purchases, redemptions, acquisitions, or otherwise; own shares excluded. No express liquidation exclusion in these sections |
Board authorizes, subject to articles and § 4-27-640(c). Committee cannot authorize distributions; reacquisition authority may follow a board-prescribed formula or method (§ 4-27-825(e)). No general shareholder-approval step. Special investment-company delegation is outside ordinary scope |
Direct or indirect money/other property, incurred debt, declared/paid dividends, purchases, redemptions, other share acquisitions, or otherwise (§ 4-27-140(6)); corporation's own shares are excluded and share dividends follow § 4-27-623 |
No separate surplus, retained-earnings, net-profit, or stated-capital source test in § 4-27-640; the two post-distribution tests and articles restrictions control |
After distribution: able to pay debts as due, and total assets ≥ total liabilities plus amount needed for superior dissolution preferences unless articles permit otherwise (§ 4-27-640(c)) |
Board may use financial statements based on reasonable accounting practices/principles, fair valuation, or another reasonable method (§ 4-27-640(d)); no distribution-specific reserve formula or adviser-reliance provision |
Board-set distribution record date; default is authorization date except repurchase/reacquisition (§ 4-27-640(b)). Acquisition: earlier of transfer/debt or status end; other debt: distribution; other payment ≤120 days: authorization, later: payment. No express general revocation rule |
Same-class and same-series rights ordinarily identical; articles set distribution and preference terms (§§ 4-27-601 to -602). Share dividends pro rata; cross-class issue needs articles, issued-class majority, or no outstanding issued-class shares (§ 4-27-623). Fractions, value cash, disposition, or scrip (§ 4-27-604) |
Compliant distribution debt ranks equally with general unsecured debt unless subordinated by agreement (§ 4-27-640(f)). No conditional-debt exclusion or express liquidation carveout in §§ 4-27-140, -640; liability, bankruptcy, covenant, tax, accounting, valuation, and advice issues outside scope |
| California verified 2026-09-03 | Cal. Corp. Code §§ 166, 500-511, 701; ordinary domestic stock corporation; covers nonliquidating shareholder transfers, dividends, purchases, and redemptions, but excludes share dividends and winding-up/dissolution proceedings |
Board makes the good-faith § 500 determination. A committee may act only at a rate, periodic amount, or price range fixed in the articles or by the board (§ 311(f)); articles may require shareholder approval, and close-corporation agreements cannot alter §§ 500-501 |
Cash or property transferred without consideration as a dividend or otherwise, plus share purchases/redemptions by the corporation or a subsidiary (§ 166); share dividends are excluded and issued under § 409; § 500(e) separately addresses indebtedness issued as a distribution |
Alternative 1: immediately before distribution, retained earnings must equal or exceed the proposed distribution plus cumulative preferential-dividend arrears (§ 500(a)(1)-(b)); no separate surplus or current-net-profit route |
Alternative 2: immediately after distribution, asset value must equal or exceed total liabilities plus superior dissolution preferences, including accrued unpaid dividends (§ 500(a)(2)-(b)); separate maturity-liquidity bar applies under § 501 |
Board may use reasonable-under-the-circumstances accounting statements, fair valuation, or another reasonable method (§ 500(c)); general § 309(b) reliance may cover competent officers/employees, experts, or a trusted board committee under its stated good-faith conditions; no special reserve formula in §§ 500-501 |
Board may set distribution record date ≤60 days before action; default is resolution date or 60th day before action, whichever is later (§ 701). § 500 test measured at authorization if paid within 120 days; declaration is § 166 dividend time. No general revocation rule; § 509(d) redemption deposit is irrevocable |
Articles set class/series rights; shares within one class or series have the same rights (§ 400). Share dividends issue under § 409; partly paid same-class shares participate by percentage paid. Fractions may issue, be arranged, receive fair-value cash, or use scrip/warrants (§ 407) |
Conditional distribution debt may be excluded from § 500(a)(2) liabilities, but each principal/interest payment is retested as a distribution (§ 500(e)); § 511 protects qualifying holders in due course but states no general unsecured-debt priority. Chapter 5 excludes winding up/dissolution (§ 508); § 501 supplies the maturity-liquidity boundary |
| Colorado verified 2026-09-03 | Colorado Business Corporation Act, C.R.S. arts. 101–117 of title 7; ordinary domestic for-profit corporation. Distribution includes direct/indirect money or property except own shares, debt, dividends, purchases, redemptions, and other acquisitions; share dividends separately governed (§§ 7-101-401, 7-106-204, 7-106-401) |
Board authorizes subject to articles and § 7-106-401(3). Committee may not authorize distributions; it may approve a reacquisition only by board- prescribed formula/method. No general shareholder approval; articles/bylaws may constrain authority (§§ 7-106-401, 7-108-206) |
Direct/indirect money or other property except own shares, incurred debt, dividend declaration/payment, purchase, redemption, other acquisition, or debt distribution (§ 7-101-401(13)); share dividends under § 7-106-204; redeemable shares may use money, debt, securities, or property (§ 7-106-101(3)(b)) |
No separate surplus, retained-earnings, net-profit, stated-capital, or other source test. Par value imposes no distribution limit or capital-account segregation unless articles/bylaws expressly provide (§ 7-106-401(7)) |
After distribution: corporation must be able to pay debts as due, and assets must be ≥ liabilities plus amount needed for superior dissolution preferences unless articles permit otherwise (§ 7-106-401(3)) |
Board may use reasonable-under-the-circumstances accounting statements, fair valuation, or another reasonable method (§ 7-106-401(4)); qualified reliance on reliable officers/employees, retained experts, or trusted committees under § 7-108-401(2)–(3); no distribution-specific reserve formula |
Bylaws or board may set a future record date; default is authorization except acquisitions. Acquisition: earlier transfer/debt or status end; other debt: distribution; other payment: authorization if ≤120 days, payment if later (§ 7-106-401(2), (5)); no general revocation rule or stated record-date maximum |
Same-class rights identical subject to permitted series terms; articles set preferences (§§ 7-106-101–102). Share dividends pro rata; cross-class issue needs articles, issuing-class majority, or no outstanding shares (§ 7-106-204). Fractions, value cash, disposition, or scrip (§ 7-106-104) |
Section 7-106-401 states no general distribution-debt parity or security rule. Properly conditional debt is excluded from liabilities, and payments on debt issued as a distribution are retested when paid (§ 7-106-401(6)). Liquidation, liability, creditor, bankruptcy, covenant, tax, valuation, and advice issues outside scope |
| Connecticut verified 2026-09-04 | Connecticut Business Corporation Act, Conn. Gen. Stat. §§ 33-600 to 33-998; ordinary domestic stock corporation. Distribution includes direct/indirect money or property except own shares, debt, dividends, purchases, redemptions, and other acquisitions; dissolution distributions excluded (§§ 33-602(6), (8), 33-687(h)) |
Board authorizes subject to certificate and § 33-687(c). Committee may act only by board-prescribed formula, method, or limits. Qualifying all- shareholder agreement may eliminate/restrict board or govern distributions, including nonproportionately, subject to § 33-687 (§§ 33-687, 33-717, 33-753) |
Direct/indirect money or other property except own shares, incurred debt, dividend declaration/payment, purchase, redemption, other acquisition, debt, or otherwise (§ 33-602(8)); share dividends under § 33-674; redemption may use cash, debt, securities, or property (§ 33-665(c)(2)) |
No separate surplus, retained-earnings, net-profit, stated-capital, or other capital-source test in § 33-687; Connecticut uses the dual post-distribution limits plus certificate, class/series, and qualifying shareholder-agreement terms |
After distribution: corporation must be able to pay debts as due, and assets must be at least liabilities plus amount needed for superior dissolution preferences unless certificate permits otherwise (§ 33-687(c)) |
Board may use reasonable-in-circumstances accounting statements, fair valuation, or another reasonable method (§ 33-687(d)); qualified reliance on reliable officers/employees, retained experts, or trusted committee absent contrary knowledge (§ 33-756(d)-(f)); no reserve formula |
Board-set record date; default is authorization except acquisitions. Acquisition: earlier transfer/debt or shareholder-status end; other debt: distribution; other payments: authorization if within 120 days, payment if later (§ 33-687(b), (e)); no general revocation rule or stated record-date maximum |
Same-class/series terms identical except certificate may expressly vary among holders; certificate sets preferences (§ 33-665). Share dividends pro rata; cross-class issue needs certificate, issuing-class majority, or no outstanding shares (§ 33-674). Fractions, value cash, disposition, or registered/bearer scrip (§ 33-668); qualifying agreement may vary proportion |
Compliant distribution debt is at parity with general unsecured creditors unless subordinated. Conditional debt may be excluded from liabilities, with principal/interest retested when paid (§ 33-687(f)-(g)); dissolution-course distributions excluded; liability, creditor, bankruptcy, covenant, tax, valuation, and advice issues outside scope |
| Delaware verified 2026-09-04 | 8 Del. C. ch. 1, especially §§ 141, 151, 154, 160, 170-173, 213, and 244; ordinary domestic stock corporation; no single general 'distribution' definition—dividends, repurchases/redemptions, stock dividends, and dissolution distributions use separate provisions |
Directors declare dividends subject to certificate restrictions (§ 170). A § 141(c)(2) committee may exercise delegated board power unless governing records/resolution limit it; a corporation governed by § 141(c)(1) needs express resolution, bylaw, or certificate authority for a committee to declare. No ordinary shareholder approval stated |
Dividends may be cash, property, or the corporation's shares (§ 173); § 170 recognizes dividend notes/debentures/obligations. Purchases and redemptions are separately authorized and capital-limited under §§ 151(b), 160 rather than treated as § 170 dividends |
Dividend source is surplus (net assets over capital) or, only if no surplus exists, current- and/or preceding-fiscal-year net profits (§§ 154, 170(a)). Net-profit route barred until a deficiency below capital represented by outstanding asset-preference classes is repaired |
No standalone ability-to-pay-debts or Model Act balance-sheet test in § 170. Surplus embeds total assets minus total liabilities minus capital (§ 154); preferred-capital deficiency limits only the no-surplus net-profit route. A related § 244 capital reduction requires remaining assets sufficient for unprovided debts |
No prescribed accounting-statement or fair-valuation method in §§ 154, 170. Directors may create/abolish proper-purpose reserves from dividend-available funds (§ 171) and are protected by § 172's stated good-faith reliance conditions; wasting-asset corporations receive the special § 170(b) depletion rule |
Board may fix a nonretroactive record date ≤60 days before the action; default is close of business on the resolution date (§ 213(c)). No general 120-day authorization-to-payment, delayed-payment retest, or dividend-revocation rule stated; dividend debt validity looks to lawful source when delivered (§ 170(a)) |
Certificate or board designation sets class/series dividend and asset-distribution preferences (§ 151). Stock dividends permitted; unissued shares require § 173 capital designation, unlike a split/division. § 155 permits fractional shares, disposition, fair-value cash, or registered scrip/warrants |
§§ 160, 170 preserve qualifying acquisition or dividend notes based on capital/source when delivered but state no general secured or unsecured priority rule. Corporate liquidation uses the separate dissolved-corporation claim-and-distribution scheme (§ 281); solvency, creditor, fiduciary, tax, accounting, and valuation advice remain outside scope |
| District of Columbia verified 2026-09-04 | D.C. Business Corporation Act, especially §§ 29-301.02(4)-(5), 29-304.01, 29-304.23, 29-304.60; ordinary domestic for-profit corporation; distribution includes money/property transfers, shareholder debt, dividends, purchases, redemptions, other share acquisitions, and other methods, but excludes own-share transfers; § 29-304.60 separately excludes liquidation |
Board authorizes subject to articles and § 29-304.60 limits. Committee may approve only under board-prescribed formula/method or limits (§ 29-306.25(e)(1)). Qualifying shareholder agreement may govern authorization/making and disproportionality but remains subject to § 29-304.60 (§ 29-305.42(a)(2)) |
Direct/indirect money or other property and incurred shareholder debt; dividend, purchase, redemption, other share acquisition, distributed debt, or another form (§ 29-301.02(5)). Own shares excluded from distribution definition and issued under separate share-dividend § 29-304.23 |
No separate surplus, retained-earnings, net-profit, stated-capital, or other lawful-source test in § 29-304.60; operative limits are the two post-distribution tests plus articles and class/series terms |
After effect: corporation must be able to pay debts as due in usual course, and total assets cannot be below total liabilities plus superior dissolution preferences unless articles permit otherwise (§ 29-304.60(c)) |
Board may use financial statements based on reasonable-in-the-circumstances accounting practices/principles, fair valuation, or another reasonable method (§ 29-304.60(d)); general § 29-306.30(d)-(e) reliance covers qualifying officers/employees, retained professionals, or committee. No special reserve formula |
Board-fixed record date; default for non-acquisition distribution is authorization date (§ 29-304.60(b)). Acquisition measured at earlier transfer/debt or end of holder status; debt when distributed; other distribution at authorization if paid within 120 days, otherwise payment (§ 29-304.60(e)). No general revocation rule |
Articles state class/series terms; ordinarily same-class/series terms identical unless express article variation (§ 29-304.01). Share dividend pro rata by default; cross-class issue needs articles, issued-class majority, or no outstanding issued-class shares; default record date is authorization (§ 29-304.23). Fractions, value cash, disposition, or registered/bearer scrip allowed (§ 29-304.04) |
Compliant distribution debt at parity with general unsecured debt unless subordinated (§ 29-304.60(f)). Conditional debt excluded from liabilities and each principal/interest payment retested (§ 29-304.60(g)). Liquidation distributions expressly excluded (§ 29-304.60(h)); insolvency, creditor, tax, accounting, fiduciary, and valuation advice outside scope |
| Florida verified 2026-09-03 | Fla. Stat. §§ 607.01401(13), (18), 607.06401; ordinary domestic for-profit corporation. Distribution covers direct/indirect money or property, debt, dividends, purchases/redemptions/acquisitions, and liquidation, but excludes own shares; § 607.06401 excludes liquidation distributions |
Board authorizes, subject to articles and § 607.06401(3). A § 607.0732 unanimous shareholder agreement may govern authorization/making but cannot evade § 607.06401. Committee may exercise board powers, but reacquisition must follow board-prescribed formula, method, or limits (§ 607.0825) |
Direct or indirect money/other property, incurred debt, declared/paid dividends, purchases, redemptions, other share acquisitions, liquidation, or otherwise (§ 607.01401(18)); corporation's own shares are excluded and share dividends follow § 607.0623 |
No separate surplus, retained-earnings, net-profit, or stated-capital source test in § 607.06401; lawful amount is constrained by the two post-distribution tests and governing records |
After distribution: able to pay debts as due, and total assets ≥ total liabilities plus amount needed for superior dissolution preferences unless articles permit otherwise (§ 607.06401(3)) |
Reasonable-under-circumstances accounting statements, fair valuation, or another reasonable method; current-valuation distributions require identification and per-share disclosure. Articles may permit cash from depletion/similar reserves with matching disclosure. Director reliance follows § 607.0830(3)-(5) |
Board-set record date cannot be retroactive; default is authorization date except share acquisitions (§ 607.06401(2)). Acquisition: earlier of transfer/debt or status end; debt distribution: distribution date; other payment ≤120 days: authorization date, later payment: payment date. No express general revocation rule |
Articles define class/series preferences and identical terms (§ 607.0601). Share dividends are pro rata by default; cross-class issue needs articles, majority vote of issued class/series, or no outstanding issued-class shares (§ 607.0623). Fractions, fair-value cash, arrangements, or scrip allowed (§ 607.0604) |
Compliant distribution debt ranks equally with general unsecured debt unless agreement provides otherwise and may be secured if other law permits. Conditional debt may be excluded from liabilities; each payment is retested (§ 607.06401(7)-(8)). Liquidation distributions excluded by subsection (9) |
| Georgia verified 2026-09-03 | O.C.G.A. §§ 14-2-140, -601, -604, -623, -640, -707, -732, -801, -825, -830, -1405; ordinary domestic for-profit corporation. Distribution covers money/property, debt, dividends, purchases/redemptions, and other acquisitions, but excludes the corporation's own shares/rights as transferred property |
Board authorizes subject to articles (§ 14-2-640(a)); delegated committee may exercise board power because § 14-2-825 has no distribution carve-out. A unanimous § 14-2-732 agreement may govern authorization or disproportionate distributions but remains subject to § 14-2-640 |
Direct/indirect money or property transfer, incurred debt, dividend declaration/payment, purchase, redemption, other share acquisition, or distributed indebtedness (§§ 14-2-140(6), -640(e)). Own-share dividends excluded from distribution definition and governed by § 14-2-623; fractions/scrip under § 14-2-604 |
No separate surplus, stated-capital, retained-earnings, or net-profit source test in § 14-2-640; Georgia uses only its dual post-distribution limits |
After distribution: corporation must be able to pay debts as due, and total assets must be ≥ total liabilities plus amount needed for superior dissolution preferences unless articles permit otherwise (§ 14-2-640(c)) |
Board may use reasonable-under-circumstances accounting statements, fair valuation, or another reasonable method (§ 14-2-640(d)); § 14-2-830(b) permits qualified reliance on reliable officers/employees/agents and competent professional sources; no special reserve rule |
Bylaws may set method or board may fix record date ≤70 days before action; default for ordinary distribution/share dividend is authorization date (§§ 14-2-707, -623(c), -640(b)). Acquisition: earlier of transfer/debt or status end; debt: distribution date; other payment ≤120 days: authorization, later: payment. No express revocation rule |
Articles set class/series preferences and identical-within-class/series terms (§ 14-2-601). Share dividends pro rata by default; cross-class issue needs articles, issued-class majority, or no outstanding issued-class shares (§ 14-2-623). Fractions, cash value, disposition, or scrip allowed (§ 14-2-604) |
Compliant distribution debt is at parity with general unsecured debt unless subordinated or secured. Conditional debt may be excluded from liabilities and each payment retested (§ 14-2-640(f)-(g)). Winding up separately discharges/provides liabilities before remaining-property distribution (§ 14-2-1405) |
| Hawaii verified 2026-09-04 | Hawaii Business Corporation Act §§ 414-3, 414-111; ordinary domestic for-profit corporation. Distribution covers direct/indirect money or property, debt, dividends, purchases/redemptions/acquisitions, and distributed debt; own shares excluded. No express liquidation exclusion in §§ 414-3, -111 |
Board authorizes, subject to articles and § 414-111(c). Committee cannot authorize distributions; reacquisitions may follow a board formula/method (§ 414-216(e)). A qualifying unanimous shareholder agreement may govern proportional or disproportionate distributions but remains subject to § 414-111 (§ 414-163) |
Direct or indirect money/other property, incurred debt, declared/paid dividends, purchases, redemptions, other share acquisitions, and distributed debt (§ 414-3); corporation's own shares excluded and share dividends follow § 414-84 |
No separate surplus, retained-earnings, net-profit, or stated-capital source test in § 414-111; the two post-distribution tests and governing records control |
After distribution: able to pay debts as due, and total assets ≥ total liabilities plus amount needed for superior dissolution preferences unless articles permit otherwise (§ 414-111(c)) |
Board may use financial statements based on reasonable accounting practices/principles, fair valuation, or another reasonable method (§ 414-111(d)). General director reliance covers records, officers/employees, professionals, and committees (§ 414-221(c)-(d)); no distribution-specific reserve formula |
Board-set distribution record date; default is authorization except a share purchase/redemption/acquisition (§ 414-111(b)). Acquisition: earlier of transfer/debt or status end; other debt: distribution; other payment ≤120 days: authorization, later: payment. No express distribution-revocation rule |
Same-class and same-series preferences/rights ordinarily identical; articles or authorized resolution sets class/series distribution terms (§§ 414-71 to -72). Share dividends pro rata; cross-class issue needs articles, issued-class majority, or no outstanding issued-class shares (§ 414-84). Fractions, value money, disposition, or scrip (§ 414-74). Escrowed-share distributions may be credited/canceled (§ 414-82(e)) |
Compliant distribution debt ranks equally with general unsecured debt unless subordinated. Conditional debt is excluded from liabilities and each payment retested (§ 414-111(f)-(g)); no express liquidation carveout. Liability, bankruptcy, covenant, tax, valuation, and advice issues outside scope |
| Idaho verified 2026-09-04 | Idaho Business Corporation Act §§ 30-29-101, -140(5)-(6), -640; ordinary domestic for-profit corporation. Distribution covers direct/indirect cash or property, debt, dividends, purchases/redemptions/acquisitions, liquidation, or otherwise; own shares excluded. § 30-29-640(h) excludes liquidation distributions |
Board authorizes, subject to articles and § 30-29-640(c). Committee may act only under a board-prescribed formula, method, or limits (§ 30-29-825(d)(1)). A qualifying all-shareholder agreement may govern proportional or disproportionate distributions but remains subject to § 30-29-640 (§ 30-29-732) |
Direct or indirect cash/other property, incurred debt, paid dividends, purchases, redemptions, other share acquisitions, liquidation, or otherwise (§ 30-29-140(6)); corporation's own shares excluded and share dividends follow § 30-29-623 |
No separate surplus, retained-earnings, net-profit, or stated-capital source test in § 30-29-640; the two post-distribution tests and governing records control |
After distribution: able to pay debts as due, and total assets ≥ total liabilities plus amount needed for superior dissolution preferences unless articles permit otherwise (§ 30-29-640(c)) |
Board may use financial statements based on reasonable accounting practices/principles, fair valuation, or another reasonable method (§ 30-29-640(d)). General director reliance covers delegated performance and records, officers/employees, professionals, and committees (§ 30-29-830(d)-(f)); no distribution-specific reserve formula |
Board-set distribution record date cannot be retroactive; default is authorization except a share purchase/redemption/acquisition (§ 30-29-640(b)). Acquisition: earlier of transfer/debt or status end; other debt: distribution; other payment ≤120 days: authorization, later: payment. No express distribution-revocation rule |
Class/series terms ordinarily identical, but articles may expressly vary terms among same-class/series holders (§ 30-29-601). Share dividends pro rata; cross-class issue needs articles, issued-class majority, or no outstanding issued-class shares; record date nonretroactive (§ 30-29-623). Fractions, value cash, disposition, or scrip (§ 30-29-604). Escrowed-share distributions may be credited/canceled (§ 30-29-621(e)) |
Compliant distribution debt ranks equally with general unsecured debt unless subordinated. Conditional debt is excluded from liabilities and each payment retested (§ 30-29-640(f)-(g)); liquidation distributions excluded by subsection (h). Liability, bankruptcy, covenant, tax, valuation, and advice issues outside scope |
| Illinois verified 2026-09-03 | 805 ILCS 5/1.80, 6.05, 6.15, 7.25, 8.05, 8.40, 9.05-9.10, 12.30; ordinary Illinois domestic corporation under the Business Corporation Act; covers distributions and own-share acquisitions, with dissolution distributions separately sequenced |
Board authorizes subject to articles (§ 9.10(a)). Committee generally cannot authorize distributions except preferred/special-class dividends and may approve reacquisitions only under a board formula/method (§ 8.40(c)); no ordinary shareholder-approval route in § 9.10 |
Section 9.10 covers distributions and expressly treats purchase, redemption, or other own-share acquisition using money, property, or incurred debt; § 9.05 authorizes own-share acquisition/treasury shares. Share dividends and splits are separately recognized; fractional shares, fair-value cash, or scrip under § 6.15 |
No separate surplus, retained-earnings, paid-in-capital, or current-net-profit source test in § 9.10; the operative equity floor is net assets ≥ zero and ≥ superior liquidation amount |
After distribution: corporation must not be unable to pay debts as due; net assets cannot be below zero or below maximum then payable on liquidation to shareholders with preferential rights (§§ 1.80(k), (m), 9.10(c)) |
Board may use financial statements prepared under reasonable-in-the-circumstances accounting practices/principles, fair valuation, or another reasonable method (§ 9.10(d)); no special depletion-reserve or director-reliance formula in the distribution section |
Board may set dividend record date ≤60 days before the action; bylaws may set a mechanism; default is board-resolution date (§§ 7.25, 9.10(b)). Authorization date controls if paid ≤120 days, otherwise payment date; own-share acquisition uses earlier of transfer/debt or shareholder-status end (§ 9.10(e)); no express revocation rule |
Articles state class designations, preferences, limits, and special/relative rights; common shares cannot prefer over another class for dividends/liquidation (§ 6.05). Share dividends affect paid-in capital/treasury shares; § 6.15 permits fractions, proportionate fair-value cash, or conditional scrip |
Debt incurred for an own-share acquisition fixes the § 9.10 measurement event, but Article 9 states no distribution-debt parity, security, or conditional-debt exclusion. Dissolution under § 12.30 pays/provides liabilities before distributing remaining assets by shareholder interests |
| Indiana verified 2026-09-03 | Indiana Business Corporation Law, IC 23-1-20, -25 to -28, -33 to -35; ordinary domestic for-profit corporation. Distribution covers direct/indirect money or property (not own shares), incurred/transferred debt, dividends, purchases/redemptions/acquisitions, and otherwise; reasonable compensation/benefits and bona fide guaranty arrangements excluded, subject to statutory non-determinative caveat |
Board authorizes subject to articles (IC 23-1-28-1). Corporation with ≤50 shareholders may dispense with/limit board in articles and name substitute duty-holders (IC 23-1-33-1(c)). Committee or designated executive officer may approve only by board-prescribed formula/method/range (IC 23-1-34-6(e)(1)) |
Direct/indirect money or other property, incurred/transferred debt, dividend declaration/payment, purchase, redemption, other acquisition, or otherwise (IC 23-1-20-7); own shares excluded from property branch but separately governed as share dividends/splits (IC 23-1-26-4); acquired shares governed by Chapter 27 |
No separate surplus, retained-earnings, net-profit, stated-capital, or capital-source test in IC 23-1-28; Indiana uses dual post-distribution limits, subject to articles and class/series terms |
After distribution: corporation must be able to pay debts as due, and total assets must be ≥ total liabilities plus amount needed for superior dissolution preferences unless articles permit otherwise (IC 23-1-28-3) |
Board may use reasonable-in-circumstances accounting statements, fair valuation, or another reasonable method (IC 23-1-28-4); qualified reliance on reliable officers/employees, experts, or trusted committee absent contrary knowledge (IC 23-1-35-1(b)-(c)); no special reserve formula |
Board may fix record, declaration, and payment dates; default nonreacquisition record date is authorization (IC 23-1-28-2). Acquisition: earlier transfer/debt or status end; ordinary debt: distribution; other payments: authorization if ≤120 days, payment if later (IC 23-1-28-5); no conditional-debt timing or general revocation rule |
Same-class and same-series rights identical subject to permitted series terms; articles set distribution preferences (IC 23-1-25-1 to -2). Share dividend/split pro rata by default; cross-class issue needs articles, majority class/series approval, or no outstanding shares (IC 23-1-26-4). Fractions, value cash, disposition arrangement, or conditional scrip (IC 23-1-25-4) |
Compliant distribution debt is at parity with general unsecured debt unless subordinated by agreement (IC 23-1-28-6). Chapter 28 has no conditional-debt liability exclusion, payment retest, special security rule, or express liquidation exclusion; financial application, liability, creditor, insolvency, liquidation, and advice questions outside scope |
| Iowa verified 2026-09-04 | Iowa Business Corporation Act, Iowa Code ch. 490; ordinary domestic for- profit corporation. Distribution includes direct/indirect cash or property except own shares, debt, dividends, purchases, redemptions, acquisitions, and liquidation; § 490.640 excludes Subchapter XIV liquidation distributions (§§ 490.140(6), (8), 490.640(8)) |
Board authorizes subject to articles and § 490.640(3). Committee may act only by board-prescribed formula, method, or limits. Qualifying all-shareholder agreement may eliminate/restrict board or govern distributions regardless of proportion, subject to § 490.640 (§§ 490.640, 490.732, 490.825) |
Direct/indirect cash or other property except own shares, incurred debt, dividend payment, purchase, redemption, other acquisition, debt, liquidation, or otherwise (§ 490.140(8)); share dividends under § 490.623; redemption may use cash, debt, securities, or property (§ 490.601(3)) |
No separate surplus, retained-earnings, net-profit, stated-capital, or other capital-source test in § 490.640; Iowa uses the dual post-distribution limits plus articles, class/series, and qualifying shareholder-agreement terms |
After distribution: corporation must be able to pay debts as due, and assets must be at least liabilities plus amount needed for superior dissolution preferences unless articles permit otherwise (§ 490.640(3)) |
Board may use reasonable-in-circumstances accounting statements, fair valuation, or another reasonable method (§ 490.640(4)); qualified reliance on reliable officers/employees, retained experts, or trusted committee absent contrary knowledge (§ 490.830(4)-(6)); no reserve formula |
Board may fix nonretroactive record date; default is authorization except acquisitions. Acquisition: earlier transfer/debt or shareholder-status end; other debt: distribution; other payments: authorization if within 120 days, payment if later (§ 490.640(2), (5)); no general revocation rule or stated forward maximum |
Same-class/series terms identical except articles may expressly vary among holders; articles set preferences (§ 490.601). Share dividends pro rata; cross-class issue needs articles, issuing-class majority, or no outstanding shares; nonretroactive record date (§ 490.623). Fractions, value cash, disposition, or registered/bearer scrip (§ 490.604); agreement may vary proportion |
Compliant distribution debt is at parity with general unsecured creditors unless subordinated. Conditional debt may be excluded from liabilities and retested when paid (§ 490.640(6)-(7)); Subchapter XIV liquidation excluded; liability, creditor, bankruptcy, covenant, tax, valuation, and advice issues outside scope |
| Kansas verified 2026-09-04 | Kansas General Corporation Code, K.S.A. ch. 17; ordinary domestic stock corporation. No single general 'distribution' definition: §§ 17-6420 to -6423 govern dividends and § 17-6410 separately governs purchases, redemptions, exchanges, and other acquisitions; liquidation is outside this survey |
Directors declare, subject to articles (§ 17-6420). Post-7/1/2004 corporations and earlier corporations electing § 17-6301(c)(3) may delegate under resolution/bylaws; other earlier corporations need express resolution/bylaws/articles authority. Close-corporation agreements/articles/bylaws may regulate dividends/profit division (§ 17-7214) |
Dividends may be cash, property, or corporation shares (§ 17-6423), and § 17-6420 recognizes notes/debentures/other obligations paid as dividends. Corporation may purchase, redeem, exchange, or otherwise acquire its shares subject to capital and articles limits (§ 17-6410) |
Dividend from surplus (net assets over capital) or, if no surplus, current and/or preceding-fiscal-year net profits. Net-profit route barred until capital deficiency below outstanding preferred-class capital is repaired. Wasting-assets corporation may calculate profits/proceeds without depletion (§§ 17-6404, -6420) |
No separate debts-as-due test or Model Act total-assets ≥ liabilities-plus-preferences test. Surplus uses net assets (total assets minus liabilities, excluding capital/surplus as liabilities); purchase/redemption cannot impair capital, subject to retirement exception (§§ 17-6404, -6410) |
Directors/committee members protected for good-faith reliance on corporate records and carefully selected officers, employees, committees, or experts about asset/liability/profit/surplus facts (§ 17-6422). Board may create/abolish proper-purpose reserves from dividend funds (§ 17-6421); no statutory fair-valuation menu |
Board record date nonretroactive and ≤60 days before dividend/distribution/right/action; default close of business on board-resolution date (§ 17-6503(c)). Dividend obligation tested when delivered; acquisition obligation tested when delivered (§§ 17-6420, -6410). No general delayed-payment or dividend-revocation rule |
Articles or authorized board resolution sets class/series dividend preferences (§ 17-6401). Stock dividend needs stated-capital designation for unissued shares; stock split excepted (§ 17-6423). Same-class partly paid shares receive dividend by paid-percentage (§ 17-6406). Fractions, fair-value cash, disposition, scrip, or warrants (§ 17-6405) |
Dividend note/debenture/obligation remains valid if lawful surplus/net profits existed when delivered; acquisition obligation remains valid if capital then unimpaired (§§ 17-6420, -6410). No special priority or conditional-debt rule. Dissolution, liability, bankruptcy, covenants, tax, valuation, and advice outside scope |
| Kentucky verified 2026-09-03 | Kentucky Business Corporation Act, Ky. Rev. Stat. ch. 271B; ordinary domestic for-profit corporation. Distribution includes direct/indirect money or property except own shares, debt, dividends, purchases, redemptions, and other acquisitions; § 271B.6-400 has no express liquidation exclusion (§§ 271B.1-400, 271B.6-400) |
Board authorizes subject to articles and § 271B.6-400(3). Committee may authorize/approve only by board-prescribed formula, method, or limits. No general shareholder approval in the surveyed provisions; chapter, articles, and bylaws may constrain delegation (§§ 271B.6-400, 271B.8-250) |
Direct/indirect money or other property except own shares, incurred debt, dividend declaration/payment, purchase, redemption, other acquisition, debt, or otherwise (§ 271B.1-400(7)); share dividends under § 271B.6-230; redemption may use cash, debt, securities, or property (§ 271B.6-010(3)) |
No separate surplus, retained-earnings, net-profit, stated-capital, or other capital-source test in § 271B.6-400; Kentucky uses the dual post-distribution limits plus articles and class/series terms |
After distribution: corporation must be able to pay debts as due, and assets must be at least liabilities plus amount needed for superior dissolution preferences unless articles permit otherwise (§ 271B.6-400(3)) |
Board may use reasonable-in-circumstances accounting statements, fair valuation, or another reasonable method (§ 271B.6-400(4)); qualified reliance on reliable officers/employees, experts, or trusted committee absent contrary knowledge (§ 271B.8-300(3)-(4)); no reserve formula |
Board-set record date; default is authorization except acquisitions. Acquisition: earlier transfer/debt or shareholder-status end; other debt: distribution; other payments: authorization if within 120 days, payment if later (§ 271B.6-400(2), (5)); no general revocation rule or stated record-date maximum |
Same-class terms identical except permitted series terms; same-series terms identical (§§ 271B.6-010, 271B.6-020). Share dividends pro rata; cross-class issue needs articles, issuing-class majority, or no outstanding shares (§ 271B.6-230). Fractions, value cash, disposition, or registered/bearer scrip (§ 271B.6-040) |
Compliant distribution debt is at parity with general creditors unless subordinated. Conditional debt may be excluded from liabilities, with principal/interest retested when paid (§ 271B.6-400(6)-(7)); no express liquidation exclusion; liability, creditor, bankruptcy, covenant, tax, valuation, and advice issues outside scope |
| Louisiana verified 2026-09-03 | Louisiana Business Corporation Act, La. R.S. 12:1-101 et seq.; ordinary domestic for-profit corporation. Distribution includes direct/indirect money or property except own shares, debt, dividends, purchases, redemptions, and other acquisitions; § 12:1-640 expressly excludes Part 14 liquidation distributions (§§ 12:1-140, 12:1-640) |
Board authorizes subject to articles and § 12:1-640(C). Committee may authorize/approve only by board-prescribed formula, method, or limits. No general shareholder approval; articles/bylaws may constrain delegation (§§ 12:1-640, 12:1-825) |
Direct/indirect money or other property except own shares, incurred debt, dividend declaration/payment, purchase, redemption, other acquisition, debt, or any other form (§ 12:1-140(6)); share dividends under § 12:1-623; redemption may use cash, debt, securities, or property (§ 12:1-601(C)(2)) |
No separate surplus, retained-earnings, net-profit, stated-capital, or other capital-source test in § 12:1-640; Louisiana uses the dual post-distribution limits plus articles and class/series terms |
After distribution: corporation must be able to pay debts as due, and assets must be ≥ liabilities plus amount needed for superior dissolution preferences unless articles permit otherwise (§ 12:1-640(C)) |
Board may use reasonable-in-circumstances accounting statements, fair valuation, or another reasonable method (§ 12:1-640(D)); qualified reliance on reliable officers/employees, retained experts, or trusted committee absent contrary knowledge (§ 12:1-830(D)–(F)); no reserve formula |
Board-set record date; default is authorization except acquisitions. Acquisition: earlier transfer/debt or status end; other debt: distribution; other payments: authorization if ≤120 days, payment if later (§ 12:1-640(B), (E)); no general revocation rule or stated record-date maximum |
Same-class/series terms identical except articles may expressly vary among holders; articles set preferences (§ 12:1-601). Share dividends pro rata; cross-class issue needs articles, issuing-class majority, or no outstanding shares (§ 12:1-623). Fractions, value cash, disposition, or scrip (§ 12:1-604) |
Compliant distribution debt is at parity with general unsecured debt unless subordinated. Conditional debt may be excluded from liabilities, with principal/interest retested when paid (§ 12:1-640(F)–(G)); Part 14 liquidation excluded; liability, creditor, bankruptcy, covenant, tax, valuation, and advice issues outside scope |
| Maine verified 2026-09-04 | Maine Business Corporation Act, 13-C M.R.S. §§ 102(4), (6), 651; ordinary domestic for-profit/share corporation. Distribution covers direct/indirect money or property, debt, dividends, purchases/redemptions/acquisitions, or otherwise; own shares excluded. § 651(8) excludes liquidation distributions |
Board authorizes, subject to articles and § 651(3). Committee may act only under a board-prescribed formula, method, or limits (§ 826(5)(A)). A qualifying all-shareholder agreement may govern proportional or disproportionate distributions but remains subject to § 651 (§ 743) |
Direct or indirect money/other property, incurred debt, declared/paid dividends, purchases, redemptions, other share acquisitions, or otherwise (§ 102(6)); corporation's own shares excluded and share dividends follow § 624 |
No separate surplus, retained-earnings, net-profit, or stated-capital source test in § 651; the two post-distribution tests and governing records control |
After distribution: able to pay debts as due, and total assets ≥ total liabilities plus amount needed for superior dissolution preferences unless articles permit otherwise (§ 651(3)) |
Board may use financial statements based on reasonable accounting practices/principles, fair valuation, or another reasonable method (§ 651(4)). Director reliance covers delegated performance and records, officers/employees, professionals, and committees (§ 831(3)-(5)); no distribution-specific reserve formula |
Board-set distribution record date; default is authorization except a share purchase/redemption/acquisition (§ 651(2)). Acquisition: earlier of transfer/debt or status end; other debt: distribution; other payment ≤120 days: authorization, later: payment (§ 651(5)). No express distribution-revocation rule |
Class/series terms ordinarily identical, but articles may expressly vary terms among same-class/series holders. Preferred shares default cumulative/nonparticipating with stated liquidation/voting rules unless law/articles/resolution changes them (§ 601). Share dividends pro rata with cross-class limits (§ 624); fractions, value money, disposition, or scrip (§ 604); escrowed-share distributions may be credited/canceled (§ 622(5)) |
Compliant distribution debt ranks equally with general unsecured debt unless subordinated. Conditional debt is excluded from liabilities and each payment retested (§ 651(6)-(7)); liquidation distributions excluded by subsection 8. Liability, bankruptcy, covenant, tax, valuation, and advice issues outside scope |
| Maryland verified 2026-09-03 | Md. Code, Corps. & Ass'ns §§ 2-105, 2-309–2-311; ordinary Maryland corporation. Covers board-authorized distributions, stock dividends/splits, own-share acquisitions, and distribution indebtedness; liquidation remains a separate Title 3 process |
Board authorizes subject to charter and § 2-311. Board may delegate amount and terms to an officer under a general authorization with a maximum-method; a board committee may exercise delegated authority because distributions are not excepted. No general stockholder vote (§§ 2-309, 2-411) |
Distribution provisions reach purchases, redemptions, other share acquisitions, indebtedness distributions, and other payments; § 2-309 separately authorizes own-share stock dividends/splits, and § 2-310 governs own-share acquisitions (§§ 2-309–2-311) |
No separate surplus or stated-capital source test for ordinary distributions. As an alternative to the balance-sheet limb, distribution may come from net earnings for the current fiscal year, preceding fiscal year, or preceding 8 fiscal quarters (§ 2-311(a)(2)) |
After distribution: must be able to pay indebtedness as due; assets must be ≥ liabilities plus superior dissolution preferences unless charter permits otherwise. Net-earnings routes except only the second limb (§ 2-311(a)) |
Board may use reasonable-in-circumstances accounting statements, fair valuation, or another reasonable method. Qualified reliance extends to reliable officers/employees, competent experts, and trusted board committees absent contrary knowledge (§§ 2-311(b), 2-405.1(d)); no reserve formula |
Board/bylaws may set dividend record date ≤90 days before action or close books ≤20 days; default is declaration date and payment ≤60 days. Acquisition: earlier transfer/debt or status end; debt: distribution; other payment: authorization if ≤120 days, otherwise payment (§§ 2-311(c), 2-511) |
Charter sets dividend/liquidation preferences and may vary terms among holders by stated external-fact method. Stock dividend/split needs board authority and is subject to charter; capital transfers differ by par status. Fractions, rounding, disposition, fair-value cash, or scrip (§§ 2-105, 2-214, 2-309) |
Compliant distribution debt is at parity with general unsecured debt unless subordinated. Properly conditional debt is excluded from liabilities and principal/interest payments are retested when paid. Liquidation, liability, creditor, bankruptcy, covenant, tax, valuation, and advice issues outside scope (§ 2-311(d)–(e)) |
| Massachusetts verified 2026-09-03 | G.L. c. 156D §§ 1.40, 6.01-.40; ordinary domestic for-profit corporation. Distribution covers direct/indirect money or property (not own shares), debt, dividends, purchases/redemptions/acquisitions, and voluntary/involuntary liquidation; § 6.40 separates going-concern and liquidation tests |
Board authorizes subject to articles (§ 6.40(a)). Committee cannot authorize distributions; may approve reacquisition only by board-prescribed formula/method (§ 8.25(e)). Compliant unanimous shareholder agreement may alter authority/proportionality but remains subject to § 6.40 and ends on public trading (§ 7.32). H.3323 would broaden formula-bound committee authority |
Direct/indirect money or other property, debt, dividend declaration/payment, purchase, redemption, other acquisition, or voluntary/involuntary liquidation (§ 1.40); own shares excluded from property branch but separately governed as share dividends (§ 6.23) |
No separate surplus, retained-earnings, net-profit, stated-capital, or capital-source test in § 6.40; Massachusetts uses going-concern solvency limits plus a separate liquidation-provision test, subject to articles and class/series terms |
Going concern: must pay existing/reasonably foreseeable obligations—liquidated or not, matured, asserted, or contingent—as due, and assets must be ≥ liabilities plus superior dissolution preferences unless articles permit otherwise (§ 6.40(c)); liquidation needs adequate provision for those obligations and superior liquidation rights (§ 6.40(h)) |
Board may use reasonable-in-circumstances accounting statements, fair valuation, or another reasonable method (§ 6.40(d)); qualified reliance on reliable officers/employees, retained experts, or trusted committee absent contrary knowledge (§ 8.30(b)); liquidation requires adequate provision, not a fixed reserve formula |
Board may fix record date; default for nonacquisition distribution/share dividend is authorization date (§§ 6.40(b), 6.23(c)). Acquisition: earlier transfer/debt or status end; ordinary debt: distribution; other payments: authorization if ≤120 days, payment if later; conditional-debt payments tested when paid (§ 6.40(e), (g)); the statute tests payments at those dates |
Articles prescribe identical same-class/series terms and distribution preferences (§ 6.01). Share dividends pro rata by default; cross-class and intervening third-class preference approvals apply (§ 6.23). Fractions, money/property for value, disposition arrangement, or conditional scrip (§ 6.04). H.3323 would revise voting-denominator wording |
Compliant distribution debt is at parity with general unsecured debt unless subordinated by agreement; conditional-pay debt is excluded from liabilities and each payment retested (§ 6.40(f)-(g)). Liquidation needs adequate provision for foreseeable obligations and superior rights (§ 6.40(h)); § 6.40(f) states parity with general unsecured creditors. H.3323 would require express subordination wording |
| Michigan verified 2026-09-03 | Mich. Comp. Laws §§ 450.1106, .1301, .1338, .1341a, .1345, .1392, .1412, .1488, .1528, .1541a, .1855a; ordinary domestic corporation under 1972 PA 284. Distribution covers money/property, debt, dividends, purchases/redemptions, and other acquisitions, but excludes own shares as transferred property |
Board authorizes subject to articles (§ 450.1345(1)); committee needs express power in board resolution, articles, or bylaws (§ 450.1528(2)). Unanimous § 450.1488 agreement may alter authority/proportionality but remains subject to §§ 450.1345 and .1855a |
Direct/indirect money/property transfer, incurred debt, dividend, purchase, redemption, other share acquisition, or other shareholder payment (§ 450.1106(4)); own shares excluded as distribution property. Share dividends under § 450.1341a; fractional shares/cash/scrip under § 450.1338 |
No separate surplus, stated-capital, retained-earnings, or net-profit source test in § 450.1345; Michigan uses its dual post-distribution limits |
After distribution: corporation must be able to pay debts as due, and total assets must be ≥ total liabilities plus amount needed for superior dissolution preferences unless articles permit otherwise (§ 450.1345(3)) |
Board may use reasonable-under-circumstances accounting statements, fair valuation, or another reasonable method (§ 450.1345(4)); § 450.1541a permits qualified reliance on reliable directors/officers/employees, experts, or a trusted committee absent contrary knowledge; no special reserve rule |
Bylaws may set or board may fix nonretroactive distribution/share-dividend record date ≤60 days before payment; default is resolution date (§ 450.1412(3)). Acquisition: earlier of transfer/debt or status end; debt and other payments use authorization if distributed/paid ≤120 days, otherwise distribution/payment date (§ 450.1345(5)); no express general revocation rule |
Articles set class/series distribution, dividend, liquidation, and other rights; same-class shares equal subject to series (§ 450.1301). Share dividends pro rata by default, with cross-class articles/class-vote/no-outstanding-share routes (§ 450.1341a). Fractions, fair-value cash, or conditional scrip under § 450.1338 |
Compliant distribution debt is at parity with general unsecured debt unless agreed otherwise. Share-acquisition obligations may split into currently distributable debt and excess future-payment portions retested under § 450.1345(7). Chapter 3 excludes dissolution distributions; § 450.1855a requires liability provision before remaining assets |
| Minnesota verified 2026-09-03 | Minnesota Business Corporation Act, Minn. Stat. ch. 302A; ordinary domestic for-profit corporation. Distribution includes direct/indirect money or property except own shares, with/without consideration, debt, dividends, liquidation, and share acquisitions; this page covers nonliquidating forms (§§ 302A.011, 302A.551) |
Board authorizes only after required debt-payment determination and must not know it became wrong before distribution. Articles/bylaws/agreement may restrict authority and set priorities. Board-resolution committee may exercise delegated authority under board direction, including non-directors; no general shareholder approval (§§ 302A.241, 302A.551) |
Direct/indirect money or other property except own shares, with or without consideration, incurred/issued debt, dividends, purchases, redemptions, and other acquisitions (§ 302A.011(10)); own-share acquisitions under § 302A.553; own-share dividends/divisions/combinations separately under §§ 302A.402 and 302A.405 |
No separate surplus, retained-earnings, net-profit, stated-capital, or other source test in § 302A.551. Minnesota uses ordinary-course debt payment plus class/series payment, net-assets, priority, and waiver protections |
Board must determine, and corporation must remain, able to pay debts in ordinary course. No general assets≥liabilities test. Preferred amounts must be paid/waived; remaining net assets must cover aggregate liquidation preferences unless paid in priority order or waived (§ 302A.551(1), (4)) |
Proper determination presumed when made under director standard using financial information prepared by reasonable accounting methods, fair valuation, or another reasonable method (§ 302A.551(2), (4)); qualified reliance on reliable officers/employees, competent experts, or trusted committee (§ 302A.251(2)); no reserve formula |
Chapter 302A states no general dividend/distribution record-date rule. Acquisition: earliest property transfer, installment/other debt incurrence, or shareholder-status end; every other distribution: authorization if paid ≤120 days, payment if later (§ 302A.551(3)); no separate debt date or general revocation rule |
Default common shares with equal rights unless articles/board set classes or series (§ 302A.401). Board-alone share dividends generally allowed unless articles exclude; cross-class issue needs articles or issuing-class majority (§§ 302A.402, 302A.405). Fractions, fair-value cash, disposition, or scrip/warrants; cash cannot cancel >20% of a class/series (§ 302A.423) |
Acquisition distribution debt to a seller who ceases to be a shareholder is at parity with general unsecured debt, subject to subordination, agreement, or pledged collateral. No conditional-debt liability exclusion/retest (§ 302A.551(3)). Liquidation, liability, creditor, bankruptcy, covenant, tax, valuation, and advice issues outside scope |
| Mississippi verified 2026-09-04 | Miss. Code §§ 79-4-1.40(4), (6), 79-4-6.40; ordinary Mississippi domestic for-profit corporation. Distribution covers direct/indirect money or property, debt, dividends, purchases/redemptions/acquisitions, or otherwise; own shares excluded. § 79-4-6.40(h) excludes liquidation distributions |
Board authorizes, subject to articles and § 79-4-6.40(c). Committee may act only under a board-prescribed formula, method, or limits (§ 79-4-8.25(e)(1)). A qualifying unanimous shareholder agreement may govern proportional or disproportionate distributions but remains subject to § 79-4-6.40 (§ 79-4-7.32) |
Direct or indirect money/other property, incurred debt, declared/paid dividends, purchases, redemptions, other share acquisitions, or otherwise (§ 79-4-1.40(6)); corporation's own shares excluded and share dividends follow § 79-4-6.23 |
No separate surplus, retained-earnings, net-profit, or stated-capital source test in § 79-4-6.40; the two post-distribution tests and governing records control |
After distribution: able to pay debts as due, and total assets ≥ total liabilities plus amount needed for superior dissolution preferences unless articles permit otherwise (§ 79-4-6.40(c)) |
Board may use financial statements based on reasonable accounting practices/principles, fair valuation, or another reasonable method (§ 79-4-6.40(d)); no distribution-specific reserve formula or adviser-reliance provision |
Board-set distribution record date; default is authorization except a share purchase/redemption/acquisition (§ 79-4-6.40(b)). Acquisition: earlier of transfer/debt or status end; other debt: distribution; other payment ≤120 days: authorization, later: payment. No express distribution-revocation rule |
Class/series terms ordinarily identical, but articles may expressly vary terms among same-class/series holders (§ 79-4-6.01). Share dividends pro rata; cross-class issue needs articles, issued-class majority, or no outstanding issued-class shares (§ 79-4-6.23). Fractions, value cash, disposition, or scrip (§ 79-4-6.04) |
Compliant distribution debt ranks equally with general unsecured debt unless subordinated. Conditional debt is excluded from liabilities and each payment retested (§ 79-4-6.40(f)-(g)); liquidation distributions excluded by subsection (h). Liability, bankruptcy, covenant, tax, valuation, and advice issues outside scope |
| Missouri verified 2026-09-03 | RSMo ch. 351; ordinary domestic corporation. Separate provisions govern dividends, paid-in-surplus distributions, purchases/redemptions, and share dividends; Chapter 351 states no single broad distribution definition (§§ 351.015, 351.180, 351.200, 351.210, 351.220) |
Board declares dividends and authorizes purchases/redemptions; a bylaw- authorized committee of ≥2 directors may exercise delegated board authority. Articles restrict dividends and share terms; no general shareholder approval in surveyed provisions (§§ 351.180, 351.200, 351.220, 351.310, 351.330) |
Dividends may be cash, property, or own shares; paid-in surplus may be cash or in kind. Purchases/redemptions are separate; redeemable shares may use cash, property, rights, or securities. No general dividend-debt form is specified (§§ 351.180, 351.200, 351.210, 351.220) |
Dividend declaration/payment prohibited when net assets are below stated capital or payment would reduce them below it. Paid-in-surplus distributions use the same floor plus full payment of accrued cumulative preferred dividends; no net-profit alternative (§§ 351.015, 351.210, 351.220) |
No general debts-as-due test or Model Act liabilities-plus-preferences test for dividends. A purchase/redemption from stated capital requires remaining assets sufficient to pay debts otherwise unprovided for; paid-in-surplus distributions must clear accrued cumulative preferred dividends (§§ 351.200–351.210) |
Sections 351.200–351.220 state no permitted financial-statement, fair-value, reserve, or expert-reliance method. Net assets exclude the corporation's own shares; paid-in surplus and stated capital have statutory definitions (§ 351.015(11)–(12), (17)) |
Board may close transfer books or, unless bylaws prohibit, set a dividend- payment record date ≤70 days before payment; no dividend default is stated. Net-assets floor applies at declaration and payment; no 120-day safe timing or general revocation rule (§§ 351.220, 351.250) |
Articles/designations set class/series dividend and liquidation preferences; preferred dividends clear before junior payments. Own-share dividends have stated-capital transfer rules; same-class splits are excluded. Fractions, value cash, or conditional scrip permitted (§§ 351.180, 351.220, 351.300) |
Surveyed provisions state no distribution-debt priority, security, conditional-debt exclusion, or payment retest. Redemption and involuntary- liquidation preferences are preserved; liquidation, liability, creditor, insolvency, valuation, tax, and advice questions remain outside scope (§§ 351.180, 351.200–351.220) |
| Montana verified 2026-09-04 | Mont. Code Ann. §§ 35-14-140(5), (7) and 35-14-640; ordinary domestic for-profit corporation. Distribution includes direct/indirect cash or other property, debt, dividends, share acquisitions, liquidation, or another form; § 35-14-640(8) excludes Part 14 liquidation distributions |
Board authorizes, subject to articles and § 35-14-640(3). Committee may act only under a board-prescribed formula, method, or limits (§ 35-14-825(4)(a)). A qualifying unanimous shareholder agreement may govern even disproportionate distributions but remains subject to § 35-14-640 (§ 35-14-732) |
Direct/indirect cash or other property except the corporation's own shares, incurred debt, dividend, purchase, redemption, other share acquisition, liquidation, or another form (§ 35-14-140(7)); § 35-14-640 excludes liquidation, and share dividends follow § 35-14-623 |
No separate surplus, retained-earnings, net-profit, or stated-capital source test appears in § 35-14-640; the two post-distribution tests, articles, and applicable class or series terms control |
After distribution: able to pay debts as due in the usual course, and total assets not less than total liabilities plus the amount needed for superior dissolution preferences unless articles permit otherwise (§ 35-14-640(3)) |
Board may use financial statements based on reasonable-in-the-circumstances accounting practices/principles, fair valuation, or another reasonable method (§ 35-14-640(4)). General director reliance covers specified officers/employees, retained experts, and trusted board committees (§ 35-14-830(4)-(6)); § 35-14-640 states no special reserve formula |
Board-set nonretroactive record date; default is authorization except for a share acquisition. Acquisition: earlier of transfer/debt or shareholder-status end; other debt: distribution date; other payment within 120 days: authorization, later: payment (§ 35-14-640(2), (5)). No general revocation rule stated |
Class/series terms ordinarily identical, but articles may expressly vary holder terms and set distribution calculations/preferences (§ 35-14-601). Share dividends default pro rata; cross-class issuance needs article authority, issued-class majority, or no outstanding issued-class shares (§ 35-14-623). Fractions, value cash, disposition, or scrip permitted (§ 35-14-604) |
Compliant distribution debt is at parity with general unsecured debt unless subordinated. Conditional debt is excluded from liabilities and each payment retested (§ 35-14-640(6)-(7)); Part 14 liquidation distributions excluded. Liability, bankruptcy, covenant, tax, valuation, and advice issues are outside scope |
| Nebraska verified 2026-09-04 | Nebraska Model Business Corporation Act §§ 21-214(5), (7), 21-252; ordinary domestic for-profit corporation. Distribution covers direct/indirect money or property, debt, dividends, purchases/redemptions/acquisitions, or otherwise; own shares excluded. § 21-252(h) excludes liquidation distributions |
Board authorizes, subject to articles and § 21-252(c). Committee may act only under a board-prescribed formula, method, or limits (§ 21-2,100(e)(1)). A qualifying all-shareholder agreement may govern proportional or disproportionate distributions but remains subject to § 21-252 (§ 21-274) |
Direct or indirect money/other property, incurred debt, declared/paid dividends, purchases, redemptions, other share acquisitions, or otherwise (§ 21-214(7)); corporation's own shares excluded and share dividends follow § 21-244 |
No separate surplus, retained-earnings, net-profit, or stated-capital source test in § 21-252; the two post-distribution tests and governing records control |
After distribution: able to pay debts as due, and total assets ≥ total liabilities plus amount needed for superior dissolution preferences unless articles permit otherwise (§ 21-252(c)) |
Board may use financial statements based on reasonable accounting practices/principles, fair valuation, or another reasonable method (§ 21-252(d)); no distribution-specific reserve formula, disclosure, or adviser-reliance list |
Board-set distribution record date; default is authorization except a share purchase/redemption/acquisition (§ 21-252(b)). Acquisition: earlier of transfer/debt or status end; other debt: distribution; other payment ≤120 days: authorization, later: payment. No express distribution-revocation rule |
Class/series terms ordinarily identical, but articles may expressly vary terms among same-class/series holders (§ 21-237). Share dividends pro rata; cross-class issue needs articles, issued-class majority, or no outstanding issued-class shares (§ 21-244). Fractions, value cash, disposition, or scrip (§ 21-240). Escrowed-share distributions may be credited/canceled (§ 21-242(e)) |
Compliant distribution debt ranks equally with general unsecured debt unless subordinated. Conditional debt is excluded from liabilities and each payment retested (§ 21-252(f)-(g)); liquidation distributions excluded by subsection (h). Liability, bankruptcy, covenant, tax, valuation, and advice issues outside scope |
| Nevada verified 2026-09-04 | NRS ch. 78; ordinary domestic stock corporation. Distribution includes direct/indirect money or property except own shares, debt, dividends, purchases, redemptions, and other acquisitions; may include partially paid shares; § 78.288 excludes § 78.590 liquidation distributions (§§ 78.015, 78.191, 78.288) |
Board authorizes subject to articles and § 78.288(2). Board-created committee may exercise specified board powers; may include non-director natural persons unless articles/bylaws say otherwise. No distribution-specific committee bar or general stockholder approval in Chapter 78 provisions (§§ 78.120, 78.125, 78.288) |
Direct/indirect money or other property except own shares, incurred debt, dividend declaration/payment, purchase, redemption, other acquisition, debt, or otherwise (§ 78.191); share dividends under § 78.215; redemption may use cash, debt, securities, or property (§ 78.196(2)) |
No separate surplus, retained-earnings, net-profit, stated-capital, or other capital-source test in § 78.288; Nevada uses the dual post-distribution limits plus articles and class/series terms |
After distribution: corporation must be able to pay debts as due, and assets must be at least liabilities plus amount needed for superior immediate- dissolution preferences unless articles specifically allow otherwise (§ 78.288(2)) |
Board may use reasonable accounting statements, fair valuation expressly including unrealized appreciation/depreciation, or another reasonable method (§ 78.288(3)); qualified reliance includes records, officers/employees, counsel, accountants, financial/valuation advisers, bankers, or trusted committee (§ 78.138(2)); no reserve formula |
Board may fix nonretroactive distribution record date; § 78.288 states no default or forward maximum. Acquisition: earlier transfer/debt or holder- status end; other debt: distribution; other payments: authorization if within 120 days, payment if later (§ 78.288(4), (7)); no general revocation rule |
Same-class/series powers, preferences, restrictions, and rights identical; articles or authorized designation sets distribution terms (§§ 78.195, 78.196). Share dividends pro rata; cross-class issue needs articles, issuing- class majority, or no outstanding shares (§ 78.215). Fractions, extra fraction, value cash, or registered/bearer scrip (§ 78.205) |
Compliant distribution debt is at parity with general unsecured creditors unless subordinated. Conditional debt may be excluded from liabilities and retested when paid (§ 78.288(5)-(6)); § 78.590 liquidation excluded and Chapter 112 inapplicable to compliant distribution; liability, bankruptcy, covenant, tax, valuation, and advice issues outside scope |
| New Hampshire verified 2026-09-04 | New Hampshire Business Corporation Act, RSA §§ 293-A:1.40(4), (6), 293-A:6.40; ordinary domestic for-profit corporation. Distribution covers direct/indirect money or property, debt, dividends, purchases/redemptions/acquisitions, or otherwise; own shares excluded. § 293-A:6.40(h) excludes liquidation distributions |
Board authorizes, subject to articles and RSA 293-A:6.40(c). Committee may act only under a board-prescribed formula, method, or limits (RSA 293-A:8.25(e)(1)). A qualifying all-shareholder agreement may govern proportional or disproportionate distributions but remains subject to RSA 293-A:6.40 (RSA 293-A:7.32) |
Direct or indirect money/other property, incurred debt, declared/paid dividends, purchases, redemptions, other share acquisitions, or otherwise (RSA 293-A:1.40(6)); corporation's own shares excluded and share dividends follow RSA 293-A:6.23 |
No separate surplus, retained-earnings, net-profit, or stated-capital source test in RSA 293-A:6.40; the two post-distribution tests and governing records control |
After distribution: able to pay debts as due, and total assets ≥ total liabilities plus amount needed for superior dissolution preferences unless articles permit otherwise (RSA 293-A:6.40(c)) |
Board may use financial statements based on reasonable accounting practices/principles, fair valuation, or another reasonable method (RSA 293-A:6.40(d)). General director reliance covers delegated performance and records, officers/employees, professionals, and committees (RSA 293-A:8.30(d)-(f)); no distribution-specific reserve formula |
Board-set distribution record date; default is authorization except a share purchase/redemption/acquisition (RSA 293-A:6.40(b)). Acquisition: earlier of transfer/debt or status end; other debt: distribution; other payment ≤120 days: authorization, later: payment. No express distribution-revocation rule |
Class/series terms ordinarily identical, but articles may expressly vary terms among same-class/series holders (RSA 293-A:6.01). Share dividends pro rata; cross-class issue needs articles, issued-class majority, or no outstanding issued-class shares (RSA 293-A:6.23). Fractions, value money, disposition, or scrip (RSA 293-A:6.04). Escrowed-share distributions may be credited/canceled (RSA 293-A:6.21(f)) |
Compliant distribution debt ranks equally with general unsecured debt unless subordinated. Conditional debt is excluded from liabilities and each payment retested (RSA 293-A:6.40(f)-(g)); liquidation distributions excluded by subsection (h). Liability, bankruptcy, covenant, tax, valuation, and advice issues outside scope |
| New Jersey verified 2026-09-03 | N.J.S.A. §§ 14A:1-2.1, 14A:7-8.1, 14A:7-13 to -16; ordinary domestic for-profit corporation. Distribution covers direct/indirect money or property (not its own shares), debt, dividends, purchases, redemptions, and other acquisitions; § 14A:7-14.1 states no liquidation exclusion |
Board resolution authorizes dividends, subject to certificate restrictions (§ 14A:7-15). A certificate/bylaw-authorized committee may exercise delegated board authority because dividends are not among § 14A:6-9's exclusions; shareholder approval applies when a share-dividend amendment triggers § 14A:7-15.1 |
Cash, corporation shares, corporation bonds, other property (including another corporation's shares/bonds), direct/indirect transfers, debt, dividends, purchases, redemptions, and other own-share acquisitions (§§ 14A:7-14.1, -15, -16) |
No default surplus, retained-earnings, or net-profit source test. Shares default to no par/no required stated capital; a certificate may require par, stated capital, or other capitalization and may add distribution restrictions (§ 14A:7-8.1) |
After giving effect: must remain able to pay debts as due in usual business and total assets must be at least total liabilities (§ 14A:7-14.1(2)). No superior-preference add-on; special share-dividend/acquisition preference rules remain certificate-sensitive (§§ 14A:7-15(5), -16(7)) |
Balance-sheet determination may use GAAP statements, other reasonable-in-the-circumstances accounting, fair valuation, or another reasonable method (§ 14A:7-14.1(3)); no special reserve formula or officer/expert-reliance rule appears in the distribution section |
Bylaws may provide, or board may fix, dividend record date no more than 60 days before the event; default is board-resolution date (§ 14A:5-7). Acquisition measured at earlier transfer/debt or shareholder-status end; otherwise authorization if paid ≤120 days, payment if later (§ 14A:7-14.1(4)); no general revocation rule stated |
Certificate restrictions control. Own-share dividends default to board action; an adverse division or amendment, or an amendment increasing the unissued-share percentage, triggers amendment/shareholder rules (§ 14A:7-15.1). Fractions, value cash, or conditional scrip permitted (§ 14A:7-13); preferred-share dividends have § 14A:7-15(5) treatment |
Compliant distribution debt is not subordinated to general unsecured debt absent agreement (§ 14A:7-14.1(5)). Own-share acquisition debt may be secured by the acquired shares, and prohibited purchase price may be deferred until payment is lawful (§ 14A:7-16(8)-(9)); this page does not apply the tests or cover liquidation/liability |
| New Mexico verified 2026-09-04 | New Mexico Business Corporation Act, NMSA 1978 §§ 53-11-2(I), 53-11-44; ordinary domestic for-profit corporation. Distribution covers direct/indirect money or property, debt, dividends, purchases, redemptions, acquisitions, or otherwise; own shares excluded. No express liquidation exclusion in §§ 53-11-2, -44 |
Board authorizes, subject to articles and § 53-11-44(A). Committee cannot declare dividends or authorize distributions, but may handle board-formula share reacquisitions (§ 53-11-41(A), (F)). No general shareholder-approval or distribution-agreement override in surveyed provisions |
Direct or indirect money/other property, incurred debt, dividends, purchases, redemptions, other share acquisitions, or otherwise (§ 53-11-2(I)); corporation's own shares excluded and stock dividends/splits follow § 53-11-18(B) |
No separate surplus, retained-earnings, net-profit, stated-capital, or other lawful-source test in § 53-11-44; the two post-distribution tests and articles restrictions control |
After distribution: able to pay debts as due, and total assets ≥ total liabilities plus maximum amount then payable on all outstanding shares having liquidation preferences unless articles permit otherwise (§ 53-11-44(A)) |
Asset test may use financial statements based on reasonable accounting practices/principles, fair valuation, or another reasonable method (§ 53-11-44(B)); no distribution-specific reserve formula or adviser-reliance list |
Bylaws, or board absent a bylaw, set advance record date ≤50 days before action; alternative book closing ≤50 days; dividend default is board-resolution date (§ 53-11-30). Share acquisition: earlier of transfer/debt or status end; other distributions: authorization, or payment if >120 days later (§ 53-11-44(C)). No general revocation rule |
Articles set class dividend/liquidation preferences; same-class shares identical except listed series variations (§§ 53-11-15 to -16). Stock dividends/splits pro rata; cross-class issue needs articles or majority of issued-class shares (§ 53-11-18(B)). Fractions, fair-value money, disposition, or scrip (§ 53-11-24). Escrowed-share distributions may be credited/canceled (§ 53-11-19(D)) |
Compliant distribution debt ranks equally with general unsecured debt unless subordinated by agreement (§ 53-11-44(D)); no conditional-debt exception or express liquidation carveout. Liability, bankruptcy, covenant, tax, accounting, valuation, and advice issues outside scope |
| New York verified 2026-09-03 | N.Y. Bus. Corp. Law §§ 102, 509-514, 604, 620, 701, 712, 717, 1005; ordinary domestic for-profit corporation; covers cash/property and share distributions plus own-share purchases/redemptions, with post-dissolution distributions governed separately |
Board-directed under §§ 510 and 701; a § 712 committee may exercise delegated board authority unless the matter is reserved. The certificate may restrict distributions and, under § 620's unanimous-authorization/notice conditions, transfer board management authority to shareholders |
Cash, corporate bonds, property including another corporation's shares/bonds (§ 510); authorized-but-unissued or treasury-share distributions (§ 511); fractions/scrip (§ 509); own-share purchase/redemption/conversion/exchange for cash, property, debt, or securities (§§ 512-513) |
Surplus route: remaining net assets ≥ stated capital. If no surplus: current- or preceding-fiscal-year net profits, but any stated-capital deficiency for outstanding liquidation-preference classes must first be repaired. Special wasting/specific-asset route in § 510(b) |
Separate due-debt test: corporation cannot be insolvent when the distribution or own-share transaction occurs or be made insolvent by it (§§ 102(a)(8), 510(a), 513(a)). Surplus uses net assets minus stated capital; wasting-asset route preserves involuntary-liquidation preferences |
No special valuation method appears in §§ 510-514. Under § 717(a), a director acting in good faith and with due care may rely on specified financial statements/data, reliable officers or employees, experts, or a trusted board committee; § 510(b) recognizes depletion/amortization or sale recovery for wasting assets |
Bylaws may fix, or otherwise board may fix, a dividend record date ≤60 days before action; default is close of business on the board-resolution date (§ 604). § 510 tests declaration, payment, or distribution; § 514 tests a share purchase at purchase. No 120-day carryover or express general revocation rule |
Certificate states class/series rights, preferences, and limits (§ 402). § 511 share distributions are pro rata, subject to cross-class, preemptive-right, capital-transfer, and notice rules; § 509 permits fractions, fair-value cash, scrip, or a reasonable sale/purchase opportunity |
§ 510 permits corporate bonds as a distribution and § 102 defines bonds as secured or unsecured, but Article 5 states no special parity rule. Own-share consideration may include debt/securities (§§ 512-513). After dissolution, liabilities must be paid or adequately provided for before remaining assets (§ 1005) |
| North Carolina verified 2026-09-03 | N.C. Gen. Stat. §§ 55-1-40, 55-6-01, -6-04, -6-23, -6-40, -7-07, -7-31, -8-01, -8-25, -8-30, -14-05; ordinary domestic for-profit/stock corporation. Distribution covers money/property, debt, dividends, purchases/redemptions, and other acquisitions, but excludes own shares as transferred property |
Board authorizes subject to articles (§ 55-6-40(a)); committee only under board-prescribed formula/method/limits (§ 55-8-25(e)). Unanimous private-corporation § 55-7-31 agreement may alter authority/proportionality but remains subject to § 55-6-40; articles/agreement may place board duties elsewhere (§ 55-8-01) |
Direct/indirect money/property transfer, incurred debt, dividend declaration/payment, purchase, redemption, other share acquisition, or distributed indebtedness (§§ 55-1-40(6), 55-6-40(e)). Own shares excluded as distribution property; share dividends under § 55-6-23 and fractions/cash/proceeds/scrip under § 55-6-04 |
No separate surplus/retained-earnings source test for an ordinary voluntary distribution. Legacy noncumulative-preferred dividend credit (§§ 55-1-40(6a), 55-6-01(d)(5)) and the separate <25-holder net-profits demand route (§ 55-6-40(i)-(j)) do not replace the dual test |
After distribution: corporation must be able to pay debts as due, and total assets must be ≥ total liabilities plus amount needed for superior dissolution preferences unless articles permit otherwise (§ 55-6-40(c)) |
Board may use reasonable-under-circumstances accounting statements and book values, fair valuation, or another reasonable method (§ 55-6-40(d)); § 55-8-30(b)-(c) permits qualified reliance on reliable officers/employees, experts, or a trusted committee absent contrary actual knowledge; no special reserve rule |
Bylaws may set method or board may fix future record date ≤70 days before action; default for ordinary distribution/share dividend is authorization date (§§ 55-7-07, 55-6-23(c), 55-6-40(b)). Acquisition: earlier of transfer/debt or status end; debt: distribution date; other payment ≤120 days: authorization, later: payment. No express general revocation rule |
Articles set class/series preferences and identical-within-class/series terms, with legacy dividend credit (§ 55-6-01). Share dividends pro rata by default; cross-class issue needs articles, no outstanding issued-class shares, or limited one-year class approval (§ 55-6-23). Fractions, cash value, sale proceeds, or scrip allowed (§ 55-6-04) |
Compliant distribution debt is at parity with general unsecured debt unless agreement provides otherwise; conditional debt may be excluded and each payment retested (§ 55-6-40(f)-(g)). Dissolution separately provides for liabilities before remaining-property distribution (§ 55-14-05); compelled-dividend litigation under § 55-6-40(h)-(k) is outside scope |
| North Dakota verified 2026-09-04 | N.D.C.C. ch. 10-19.1, especially §§ 10-19.1-01(16),(19), -48, -50, -61 to -61.1, -63, -68, -83, and -92; ordinary domestic for-profit corporation; distribution includes money/property, debt, dividends, interim and liquidation distributions, purchases, redemptions, and other acquisitions, but excludes own shares |
Board authorizes under § 10-19.1-92; articles, bylaws, or agreement may prohibit/limit/restrict and establish recipient priority. Board committee may exercise only resolution-delegated authority and remains board-controlled (§ 10-19.1-48). All-holder/subscriber control agreement may govern declaration/payment (§ 10-19.1-83) |
Direct/indirect money or other property, with or without consideration, and incurred/issued debt; dividend, interim or liquidation distribution, purchase, redemption, other share acquisition, or another form (§ 10-19.1-01(19)). Own shares excluded and handled under §§ 10-19.1-61.1, -63 |
No separate surplus, retained-earnings, net-profit, stated-capital, or other lawful-source test in § 10-19.1-92; financial limits are ordinary-course debt payment plus the class/series preference and remaining-net-assets overlay |
Board must determine corporation can pay debts in ordinary course after distribution and must not know before payment that this became erroneous (§ 10-19.1-92(1)-(2)). No universal assets-versus-liabilities test; class distribution separately requires senior amounts paid and remaining net assets ≥ aggregate liquidation preferences unless priority-order or notice-waiver route applies (§ 10-19.1-92(5)-(7)) |
Liquidity and preference determinations presumed proper when made under director-conduct standard from financial information using reasonable accounting methods, fair valuation, or another reasonable method (§ 10-19.1-92(2),(6)); director reliance may use qualifying officers/employees, professionals, or committee (§ 10-19.1-50). No express distribution-reserve formula |
No general dividend record-date or revocation rule in §§ 10-19.1-61.1, -92. Share acquisition measured at earliest transfer, debt incurrence, or end of shareholder status; other distribution at authorization if paid within 120 days, otherwise payment (§ 10-19.1-92(3)) |
Default one common voting class/series with equal rights unless articles/board fix alternatives; distributions may be cumulative or preferred (§ 10-19.1-61). Share dividends ordinarily board-only, subject to adverse-right/unissued-percentage amendment rules; own shares issued pro rata, with articles or same-issued-class majority for cross-class issue (§§ 10-19.1-61.1, -63). Fractions/disposition/value cash/registered or bearer scrip permitted with 20% cancellation cap (§ 10-19.1-68) |
Distribution debt to a shareholder who exits in transaction is at parity with general unsecured debt except agreed subordination, security pledge, or other agreement (§ 10-19.1-92(4)); no conditional-debt exclusion/retest. Chapter 13-02.1 expressly does not apply to chapter-10-19.1 distributions (§ 10-19.1-92(3)(c)); liquidation, creditor, fiduciary, tax, accounting, and valuation advice outside scope |
| Oklahoma verified 2026-10-06 | Oklahoma General Corporation Act, 18 O.S. §§ 1001-1144; ordinary domestic private stock corporation. No general “distribution” definition: dividends under §§ 1049/1052, own-stock purchase/redemption under § 1041, and class/series distribution terms under § 1032; voluntary nonliquidating scope |
Directors declare/pay dividends subject to certificate restrictions (§ 1049(A)). Board-created committee may exercise board powers within its resolution/bylaws; dividend authority is not among § 1027(C)'s exclusions. No general shareholder approval; certificate may reallocate/limit authority (§ 1027(A), (C)); future contract route begins Nov. 1, 2026 |
Dividends may be cash, property, or corporation shares (§ 1052); note, debenture, or other obligation recognized (§ 1049(A)). Own-share purchase or redemption may use cash/property; redeemable stock may use cash, property, rights, or securities (§§ 1032(B), 1041(A)) |
Dividend from surplus (net assets minus capital), or if no surplus, current- or preceding-fiscal-year net profits. Preferred-class capital deficiency must first be repaired for net-profit dividends (§§ 1035, 1049(A)); special wasting-asset net-profit/net-proceeds method (§ 1049(B)) |
No general debts-as-due or Model Act assets-vs.-liabilities-plus-preferences dividend test. Surplus uses net assets (assets minus liabilities); capital reduction cannot leave assets insufficient for unprovided debts (§§ 1035, 1079(B)). Purchase/redemption generally cannot impair capital (§ 1041(A)) |
No dividend-specific financial-statement, fair-valuation, or reserve formula in §§ 1035/1049. Board/committee member protected for good-faith reliance on corporate records and carefully selected competent presenters (§ 1027(E)); wasting-asset method may disregard depletion (§ 1049(B)) |
Board may fix nonretroactive dividend/distribution record date no more than 60 days before action; default is resolution day (§ 1058(C)). No general payment-delay, revocation, or universal financial-test date; debt-dividend and acquisition-obligation validity tested at delivery (§§ 1041(A), 1049(A)). Narrow emergency date-change route (§ 1014(I)(2)) |
Certificate/authorized board resolution sets class/series dividend rates, conditions, timing, and preferences; preferred dividends paid or set apart before remaining-class dividend (§ 1032(A), (C)). Stock dividend requires capital designation; split/division does not (§ 1052). Fractions, cash fair value, disposition, or registered/bearer scrip/warrants (§ 1036) |
Dividend note/debenture/obligation protected if lawful source existed at delivery; acquisition obligation protected if capital then unimpaired (§§ 1041(A), 1049(A)). No statutory priority or conditional-debt rule. Wasting- asset “liquidation” is an earnings method, not dissolution distribution; liability, creditor, insolvency, tax, valuation, and advice issues excluded |
| Oregon verified 2026-09-03 | Oregon Business Corporation Act, ORS ch. 60; ordinary domestic for-profit corporation. Distribution includes direct/indirect money or property except own shares, debt, dividends, purchases, redemptions, and other acquisitions; § 60.181 has no express liquidation exclusion (§§ 60.001, 60.181) |
Board authorizes subject to articles and its judgment under § 60.181(3). Committee may authorize/approve only by board-prescribed formula, method, or limits. No general shareholder approval in the surveyed provisions; chapter, articles, and bylaws may constrain delegation (§§ 60.181, 60.354) |
Direct/indirect money or other property except own shares, incurred debt, dividend declaration/payment, purchase, redemption, other acquisition, debt, or otherwise (§ 60.001(7)); share dividends and splits under § 60.154; redemption may use cash, debt, securities, or property (§ 60.131(3)) |
No separate surplus, retained-earnings, net-profit, stated-capital, or other capital-source test in § 60.181; Oregon uses the dual post-distribution limits plus articles and class/series terms |
After distribution, in board's judgment: corporation must be able to pay debts as due, and assets must be at least liabilities plus amount needed for superior dissolution preferences unless articles permit otherwise (§ 60.181(3)) |
Board may use reasonable-in-circumstances accounting statements, fair valuation, or another reasonable method (§ 60.181(4)); qualified reliance on reliable officers/employees, experts, or trusted committee absent contrary knowledge (§ 60.357(2)-(3)); no reserve formula |
Board-set record date; default is authorization except acquisitions. Acquisition: earlier transfer/debt or shareholder-status end; other debt: distribution; other payments: authorization if within 120 days, payment if later (§ 60.181(2), (5)); no general revocation rule or stated record-date maximum |
Same-class terms identical except permitted class/series terms; same-series terms identical (§§ 60.131, 60.134). Share dividends pro rata; cross-class issue needs articles, issuing-class majority, or no outstanding shares; share dividend includes nonreverse split (§ 60.154). Fractions, value cash, disposition, or registered/bearer scrip (§ 60.141) |
Compliant distribution debt is at parity with general unsecured creditors unless shareholder agrees to subordination or corporation grants security or lien (§ 60.181(6)); no conditional-debt exclusion/retest or express liquidation exclusion; liability, creditor, bankruptcy, covenant, tax, valuation, and advice issues outside scope |
| Pennsylvania verified 2026-09-03 | 15 Pa.C.S. §§ 1103, 1509, 1521, 1527, 1551-1552, 1721, 1731, 1763; ordinary domestic for-profit business corporation. Distribution includes dividends, debt, and own-share acquisitions, excludes own shares/options as transferred property, and reaches winding up |
Board authorizes unless bylaws restrict (§ 1551(a)); delegated committee may act under § 1731. A shareholder-adopted bylaw may assign board powers under § 1721; articles may change the superior-preference add-on, and statutory-close agreements may address dividends (§ 2335) |
Direct/indirect money or property transfer, incurred debt, dividend, purchase, redemption, or other share acquisition (§ 1103); own shares/options excluded as distribution property and pro rata own-share dividends treated separately. Own-share acquisition/deferred payment under § 1552; fractions/scrip under § 1527 |
No separate surplus, stated-capital, retained-earnings, or net-profit source test. Section 1551(a) says par value does not restrict distributions; compliance turns on § 1551(b)'s two post-distribution tests |
After giving effect: corporation must be able to pay debts as due, and total assets must be ≥ total liabilities plus the amount needed for superior dissolution preferences unless articles provide otherwise (§ 1551(b)) |
Board may use book values; unrealized appreciation/depreciation or other value changes; current value separately, by segments, or as a going concern; or another reasonable method. Only balance-sheet liabilities required by GAAP or the corporation's reasonable usual practices need be considered (§ 1551(c)) |
Board may fix a nonretroactive record date; default is close of business on resolution date (§ 1763). Board-specified date controls if distribution occurs within 125 days of earlier of that date/authorization; otherwise distribution date. Acquisition uses earlier of transfer/debt or holder-status end (§ 1551(d)); no ordinary revocation rule |
Shares default equal unless articles or permitted shareholder bylaw provides otherwise, but own-share acquisitions need not reach all or same-class shares (§ 1521). Own-share stock dividend/split is pro rata; § 1527 allows fractions, disposition, fair-value cash, or nonparticipating scrip |
Compliant distribution debt is at least equal to general unsecured debt unless subordinated; conditional distribution debt is excluded from liabilities and each payment retested (§ 1551(e)-(f)). Winding-up/postdissolution distributions remain subject to § 1551, with adequately provided/barred liabilities excluded |
| Rhode Island verified 2026-09-04 | Rhode Island Business Corporation Act, R.I. Gen. Laws §§ 7-1.2-106, -601, -614; ordinary domestic for-profit corporation; § 614 separately governs distributions other than shares and share distributions, including dividends, purchases, redemptions, other share acquisitions, and distributed debt; no express liquidation exclusion in § 614 |
Board authorizes subject to articles and § 7-1.2-614(a)(3); board resolution also governs own-share acquisition (§ 7-1.2-601). A properly designated committee may exercise board authority because distributions are not excluded (§ 7-1.2-808). Shareholders have narrow class-waiver and cross-class share-issue roles, not a stated general approval role (§ 7-1.2-614) |
Other-than-share distribution forms include purchases, redemptions, other own-share acquisitions, transferred money or property, and distributed debt; § 7-1.2-614(b) separately governs pro rata share distributions. Preferred shares may be redeemable for cash, property, promissory notes, rights, or other-company securities (§§ 7-1.2-601, -602, -614) |
No separate surplus, net-profit, retained-earnings, stated-capital, or other source test appears. Preferred or special dividend terms and priority control first; a remaining class may receive dividends from remaining assets available for dividends, subject to the § 7-1.2-614 dual test (§ 7-1.2-602(f)) |
After effect: corporation cannot be unable to pay debts as they become due in the usual course, and total assets cannot be below total liabilities plus superior dissolution preferences unless articles permit otherwise or a majority of the superior class waives the preference add-on (§§ 7-1.2-106(10), -614(a)(3)) |
Board may use financial statements based on reasonable-in-the-circumstances accounting practices/principles, fair valuation, or another reasonable method (§ 7-1.2-614(a)(4)); no special reserve formula or officer, employee, committee, or expert reliance rule appears in § 7-1.2-614 |
Bylaws or board may fix a dividend record date up to 60 days before the action; default is board authorization (§§ 7-1.2-703(a), -614(a)(2),(b)(3)). Acquisition measured at earlier transfer/debt or end of holder status; debt when distributed; other distribution at authorization if paid within 120 days, otherwise payment. No express revocation rule (§ 7-1.2-614(a)(5)) |
Articles or authorized board resolution states class/series dividend and liquidation preferences (§ 7-1.2-602). Share distribution is pro rata by default; cross-class issue requires articles authority, issued-class majority approval, or no outstanding issued-class shares (§ 7-1.2-614(b)). Fractions, disposition, fair-value cash, or registered/bearer scrip allowed (§ 7-1.2-610) |
Compliant distribution debt is at parity with general unsecured debt unless subordinated. Conditional debt is excluded from liabilities and each principal/interest payment is retested (§ 7-1.2-614(a)(6)-(7)). Section 614 states no express liquidation exclusion or secured-priority rule; liquidation, creditor, tax, accounting, fiduciary, and valuation advice remains outside scope |
| South Carolina verified 2026-09-03 | South Carolina Business Corporation Act of 1988, S.C. Code tit. 33, chs. 1–20; ordinary domestic for-profit corporation. Distribution includes direct/indirect money or property except own shares, debt, dividends, purchases, redemptions, and other acquisitions; share dividends separately governed (§§ 33-1-101, 33-1-400, 33-6-230, 33-6-400) |
Board authorizes subject to articles and § 33-6-400(c). Committee may not authorize distributions; it may approve reacquisition only by board- prescribed formula/method. No general shareholder approval; articles may restrict (§§ 33-6-400, 33-8-250) |
Direct/indirect money or property except own shares, incurred debt, dividend declaration/payment, purchase, redemption, other acquisition, debt, or other distribution (§ 33-1-400(7)); share dividends under § 33-6-230; redeemable shares may use cash, debt, securities, or property (§ 33-6-101(c)(2)) |
No separate surplus, retained-earnings, net-profit, stated-capital, or other capital-source test in § 33-6-400; South Carolina uses the dual post- distribution limits plus articles and class/series terms |
After distribution: corporation must be able to pay debts as due, and assets must be ≥ liabilities plus amount needed for superior dissolution preferences unless articles permit otherwise (§ 33-6-400(c)) |
Board may use reasonable-in-circumstances accounting statements, fair valuation, or another reasonable method (§ 33-6-400(d)); qualified reliance on reliable officers/employees, competent experts, or trusted committee (§ 33-8-300(b)–(c)); no distribution-specific reserve formula |
Board-set record date; default is authorization except repurchase/ reacquisition. Acquisition: earlier transfer/debt or status end; other debt: distribution; other payments: authorization if ≤120 days, payment if later (§ 33-6-400(b), (e)); no general revocation rule or stated record-date maximum |
Same-class/series rights identical subject to permitted series terms; articles set preferences (§§ 33-6-101–102). Share dividends pro rata; cross- class issue needs articles, issuing-class majority, or no outstanding shares (§ 33-6-230). Fractions, value cash, disposition, or scrip (§ 33-6-104) |
Compliant distribution debt is at parity with general unsecured debt unless subordinated (§ 33-6-400(f)). Section states no security treatment, conditional-debt liability exclusion, or payment retest. Liquidation, liability, creditor, bankruptcy, covenant, tax, valuation, and advice issues outside scope |
| South Dakota verified 2026-09-04 | SDCL ch. 47-1A, especially §§ 47-1A-140(4),(6), -601, -623, and -640 to -640.5; ordinary domestic for-profit corporation; distribution includes direct/indirect money or other-property transfers, shareholder debt, dividends, purchases, redemptions, and other share acquisitions, but excludes own-share transfers |
Board authorizes, subject to articles and §§ 47-1A-640 to -640.5. Committee may approve only under a board-prescribed formula/method or limits (§ 47-1A-825.1). Qualifying shareholder agreement may govern authorization/making and disproportionality but remains subject to the financial limits (§ 47-1A-732) |
Money, other property, and incurred shareholder indebtedness; dividend, purchase, redemption, other share acquisition, distributed debt, or another form (§ 47-1A-140(6)). Own shares excluded from distribution definition and issued under separate share-dividend § 47-1A-623 |
No separate surplus, retained-earnings, net-profit, stated-capital, or other lawful-source test in §§ 47-1A-640 to -640.5; operative limits are the two post-distribution tests plus articles and class/series terms |
After effect: corporation must be able to pay debts as due in usual course, and total assets cannot be below total liabilities plus superior dissolution preferences unless articles permit otherwise (§ 47-1A-640.1) |
Board may use financial statements based on reasonable-in-the-circumstances accounting practices/principles, fair valuation, or another reasonable method (§ 47-1A-640.1); no separate reserve formula or person-reliance rule in §§ 47-1A-640 to -640.5 |
Board-fixed record date; default for non-acquisition distribution is authorization date (§ 47-1A-640). Acquisition measured at earlier transfer/debt or end of holder status; debt when distributed; other distribution at authorization if paid within 120 days, otherwise payment (§ 47-1A-640.2). No general revocation rule |
Articles state class/series terms; same-class/series terms identical unless § 47-1A-601 permits variation. Share dividend pro rata by default; cross-class issue needs articles, issued-class majority, or no outstanding issued-class shares; default record date is authorization (§ 47-1A-623). Fractions, value cash, disposition, or registered/bearer scrip permitted (§ 47-1A-604) |
Compliant distribution debt at parity with general unsecured debt unless subordinated (§ 47-1A-640.3). Conditional debt excluded from liabilities and each principal/interest payment retested (§ 47-1A-640.4). Liquidation distributions expressly excluded (§ 47-1A-640.5); insolvency, creditor, tax, accounting, fiduciary, and valuation advice outside scope |
| Tennessee verified 2026-09-03 | Tennessee Business Corporation Act, Tenn. Code Ann. §§ 48-11-201, 48-16-101 to -401; ordinary domestic for-profit corporation. Distribution covers direct/indirect money or property (not own shares), direct/indirect debt including guaranty, dividends, purchases/redemptions/acquisitions, and otherwise; no express liquidation exclusion in § 48-16-401 |
Board authorizes subject to charter (§ 48-16-401(a)). Committee may authorize a distribution or reacquisition only by board-prescribed formula/method (§ 48-18-206). No special all-shareholder governance-override distribution section appears in the surveyed current Act; charter, bylaws, and ordinary agreements remain transaction-specific boundaries |
Direct/indirect money or other property, debt directly or indirectly including guaranty, dividend declaration/payment, purchase, redemption, other acquisition, distribution/incurrence of debt, or otherwise (§ 48-11-201); own shares excluded from property branch but separately governed as share dividends (§ 48-16-204) |
No separate surplus, retained-earnings, net-profit, stated-capital, or capital-source test in § 48-16-401; Tennessee uses dual post-distribution limits, subject to charter and class/series terms |
After distribution: corporation must be able to pay debts as due, and total assets must be ≥ total liabilities plus amount needed for superior dissolution preferences unless charter permits otherwise (§ 48-16-401(c)) |
Board may use reasonable-in-circumstances accounting statements, fair valuation, or another reasonable method (§ 48-16-401(d)); qualified reliance on reliable corporation/subsidiary officers or employees, experts, or trusted committee absent contrary knowledge (§ 48-18-301); no special reserve formula |
Board may fix record date; default for nonreacquisition distribution/share dividend is authorization date (§§ 48-16-401(b), 48-16-204(c)). Acquisition: earlier transfer/debt or status end; ordinary debt: distribution/incurrence date; secured debt: security-instrument execution/delivery; other payments: authorization if ≤4 months, payment if later; conditional debt tested when paid (§ 48-16-401(e), (g)); no general revocation rule |
Same-class rights identical subject to § 48-16-102; charter sets distribution preferences (§ 48-16-101). Share dividends pro rata by default; cross-class issue needs charter, majority class/series approval, or no outstanding shares (§ 48-16-204). Fractions, value cash, disposition arrangement, or conditional scrip (§ 48-16-104) |
Compliant distribution debt is at parity with general unsecured debt unless subordinated by agreement. Conditional-pay debt is excluded from liabilities and each payment retested; secured-debt incurrence has an execution/delivery rule (§ 48-16-401(e)-(g)). No express liquidation exclusion or separate security authorization; financial application/liability/advice outside scope |
| Texas verified 2026-09-03 | Tex. Bus. Orgs. Code §§ 21.002, 21.301-.315; ordinary domestic for-profit corporation. Distribution includes cash/property, debt, dividends, direct/indirect purchases or redemptions, and liquidation payments; excludes same-class splits without stated-capital increase and transfers of own shares or acquisition rights |
Board may authorize and may set a maximum, period, and formula (§ 21.302). Authorized board committee may distribute (§ 21.416(d)); unanimous shareholder agreement may govern authorization or making, subject to § 21.303 (§ 21.101) |
Property including cash, issued debt, class/series dividends, direct or indirect own-share purchases/redemptions, and liquidation payments (§ 21.002(6)); own-share transfers and share dividends are outside that definition and follow separate share/share-dividend rules |
Ordinary distribution limit is surplus—net assets minus stated capital (§§ 21.002(9), (11)-(12), 21.301(1)(B)). Defined fractional-share, debt-compromise, dissenters', consuming-assets, and qualifying investment-company distributions instead use net assets; no net-profit route |
Distribution may not exceed the applicable surplus/net-assets limit or leave the corporation unable to pay debts as due (§§ 1.002(40), 21.303). Certificate limits and class/series preferences also control; statute states no separate superior-liquidation-preference add-on |
May use GAAP, IFRS, tax-return or other reasonable accounting, summaries, reasonable projections/forecasts, fair valuation, another reasonable method, or combinations (§ 21.314). Board may create, change, or abolish surplus reserves/designations (§ 21.309); no distribution-specific person-reliance rule |
Governing documents or board may set ordinary distribution record date, no earlier than 60 days before action; default is declaration-resolution date (§ 6.101). Measure at authorization if made within 120 days; later use qualifying board-designated date or payment date (§ 21.315). No general revocation rule; redemption payment instructions may be irrevocable |
Same-class shares identical unless divided into series; same-series shares identical (§ 21.152). Different-class share dividend needs certificate authority or majority approval of issued class (§ 21.311); surplus-to-capital transfer required (§ 21.313). Fractions, fair-value cash, or scrip allowed (§§ 21.163-.164) |
Declared-distribution debt and debt issued in a distribution rank equally with general unsecured debt, subject to agreed subordination and required security (§ 21.308). Debt is distributed when incurred (§ 21.315(b)). Chapter 11-compliant liquidation is a separate branch; § 21.303 supplies current insolvency and source limits |
| Utah verified 2026-10-02 | Utah Revised Business Corporation Act, Utah Code tit. 16, ch. 10a; ordinary domestic for-profit corporation. Distribution includes direct/indirect money or property except own shares, debt, dividends, purchases, redemptions, and other acquisitions; § 16-10a-640 has no express liquidation exclusion (§§ 16-10a-101, -102, -640) |
Board authorizes subject to articles and § 16-10a-640(3). Committee may exercise board authority as specified, with no distribution-specific barred power. Qualifying all-shareholder agreement may restrict board or govern distributions, including nonproportionately, subject to § 640 (§§ 16-10a-640, -732, -825) |
Direct/indirect money or other property except own shares, incurred debt, dividend declaration/payment, purchase, redemption, other acquisition, debt, or other form (§ 16-10a-102(13)); share dividends under § 16-10a-623; redemption may use money, debt, securities, or property (§ 16-10a-601(3)) |
No separate surplus, retained-earnings, net-profit, stated-capital, or other capital-source test in § 16-10a-640; Utah uses the dual post-distribution limits plus articles, class/series, and qualifying shareholder-agreement terms |
After distribution: corporation must be able to pay debts as due, and assets must be at least liabilities plus amount needed for superior dissolution preferences unless articles permit otherwise (§ 16-10a-640(3)) |
Board may use reasonable-in-circumstances accounting statements, including consolidated statements, fair valuation, or another reasonable method (§ 16-10a-640(4)); qualified reliance on reliable officers/employees, experts, or trusted committee absent contrary knowledge (§ 16-10a-840(2)-(3)); no reserve formula |
Bylaws or fallback board may set future record date; default, if needed, is authorization. Acquisition: earlier transfer/debt or shareholder-status end; other debt: distribution; other payments: authorization if within 120 days, payment if later (§ 16-10a-640(2), (5)) |
Same-class and same-series preferences/rights identical (§§ 16-10a-601, -602). Share dividends pro rata; cross-class issue needs articles, issuing-class majority, or no outstanding shares; bylaws/board set record date (§ 16-10a-623). Fractions, value cash, disposition, or registered/bearer scrip (§ 16-10a-604); qualifying agreement may vary proportion |
Unsecured compliant distribution debt is at parity with general unsecured creditors unless subordinated; § 16-10a-640(6) grants parity only to unsecured distribution debt. Conditional debt may be excluded from liabilities and retested when paid (§ 16-10a-640(6)-(7)); no express liquidation exclusion; liability, bankruptcy, covenant, tax, valuation, and advice issues outside scope |
| Vermont verified 2026-09-04 | 11A V.S.A. §§ 1.40(4),(6), 6.01, 6.04, 6.23, 6.40; ordinary domestic for-profit corporation; distribution includes direct/indirect money or other-property transfers, shareholder debt, dividends, purchases, redemptions, other share acquisitions, and other forms, but excludes own-share transfers; § 6.40 states no express liquidation exclusion |
Board authorizes subject to articles and § 6.40. Committee may not authorize distributions, though it may approve reacquisitions under a board formula/method (§ 8.25(e)). Qualifying shareholder agreement may govern authorization/making and disproportionality but remains subject to § 6.40 (§ 7.32(a)(2)) |
Direct/indirect money or other property and incurred shareholder debt; declaration/payment of dividend, purchase, redemption, other share acquisition, distributed debt, or another form (§ 1.40(6)). Own shares excluded from distribution definition and issued under separate share-dividend § 6.23 |
No separate surplus, retained-earnings, net-profit, stated-capital, or other lawful-source test in § 6.40; operative limits are the two post-distribution tests plus articles and class/series terms |
After effect: corporation must be able to pay debts as due in usual course, and total assets cannot be below total liabilities plus superior dissolution preferences unless articles permit otherwise (§ 6.40(c)) |
Board may use financial statements based on GAAP, professional appraisals, or another reasonable-under-the-circumstances method (§ 6.40(d)); general § 8.30(b)-(c) reliance covers qualifying officers/employees, professionals, or committee. No special reserve formula or generic fair-valuation wording |
Board-fixed record date; default for non-repurchase/reacquisition distribution is authorization date (§ 6.40(b)). Acquisition measured at earlier transfer/debt or end of holder status; debt when distributed; other distribution at authorization if paid within 120 days, otherwise payment (§ 6.40(e)). No general revocation rule |
Articles state class terms; same-class preferences/limits/rights ordinarily identical (§ 6.01). Share dividend pro rata by default; cross-class issue needs articles, issued-class majority, or no outstanding issued-class shares; default record date is authorization (§ 6.23). Fractions, value cash, disposition, or registered/bearer scrip allowed (§ 6.04) |
Compliant distribution debt at parity with general unsecured debt unless subordinated (§ 6.40(f)). No conditional-debt liability exclusion, payment retest, or express liquidation exclusion in § 6.40. Liquidation, insolvency, creditor, tax, accounting, fiduciary, and valuation advice remain outside scope |
| Virginia verified 2026-09-03 | Va. Code §§ 13.1-603, -638 to -653; ordinary domestic stock corporation. Distribution includes direct/indirect cash or property (not own shares), debt, dividends, purchases/redemptions/acquisitions, and liquidation; limited life-insurance-funded acquisition exclusion. § 13.1-653 excludes Article 16 liquidation |
Board authorizes subject to articles (§ 13.1-653(A)). Committee may approve only by board-prescribed formula/method or within board limits (§ 13.1-689(D)(6)). Compliant unanimous shareholder agreement may alter authority/proportionality but remains subject to § 13.1-653 (§ 13.1-671.1) |
Direct/indirect cash or other property, debt, dividends, purchases, redemptions, other acquisitions, or otherwise (§ 13.1-603); corporation's own shares excluded from property branch but separately governed as share dividends (§ 13.1-645); acquired shares become authorized/unissued (§ 13.1-652) |
No separate surplus, retained-earnings, net-profit, stated-capital, or capital-source test in § 13.1-653; Virginia uses the dual post-distribution limits, subject to articles and class/series terms |
After distribution: corporation must be able to pay debts as due, and total assets must be ≥ total liabilities plus amount needed for superior dissolution preferences unless articles permit otherwise (§ 13.1-653(C)) |
Board may use reasonable-in-the-circumstances accounting statements, fair valuation, or another reasonable method (§ 13.1-653(D)); qualified reliance on reliable officers/employees, experts, or trusted committee absent contrary knowledge (§ 13.1-690(B)); no special reserve formula |
Board fixes distribution record date; default for nonacquisition distributions is authorization date (§ 13.1-653(B)); share-dividend default also authorization (§ 13.1-645(C)). Acquisition: earlier transfer/debt or status end; debt distribution: distribution date; other payments: authorization if ≤120 days, payment if later (§ 13.1-653(E)); no general revocation rule stated |
Same-class/series terms identical unless authorized variation is express in articles; articles set distribution/preferences (§ 13.1-638). Share dividends pro rata by default; cross-class issuance needs articles, majority class/series approval, or no outstanding shares (§ 13.1-645). Fractions, value cash, scrip, or disposition arrangement (§ 13.1-641) |
Compliant distribution debt is at parity with general unsecured debt unless subordinated by agreement. Conditional-pay debt is excluded from liabilities and each payment retested as a distribution (§ 13.1-653(F)-(G)). Article 16 liquidation excluded; no special security rule in § 13.1-653; financial application/liability/advice outside scope |
| Washington verified 2026-09-03 | Washington Business Corporation Act, RCW 23B.01.400 and ch. 23B.06; ordinary domestic for-profit corporation. Distribution includes direct/indirect money or property (not own shares), debt, dividends, liquidation/dissolution payments, purchases/redemptions/acquisitions, and otherwise; this page limits itself to voluntary nonliquidating distributions |
Board approves subject to articles (RCW 23B.06.400(1)). Committee may approve only by board-prescribed formula/method or within board limits (RCW 23B.08.250(4)(a)). Compliant unanimous shareholder agreement may alter authority/proportionality but remains subject to RCW 23B.06.400 and ends on public trading (RCW 23B.07.320) |
Direct/indirect money or other property, debt, dividend declaration/payment, purchase, redemption, other acquisition, liquidation/dissolution, or otherwise (RCW 23B.01.400(8)); own shares excluded from property branch but separately governed as share dividends (RCW 23B.06.230); acquired shares become authorized/unissued (RCW 23B.06.310) |
No separate surplus, retained-earnings, net-profit, stated-capital, or capital-source test in RCW 23B.06.400; Washington uses its dual post-distribution limits, subject to articles and class/series terms |
After distribution: corporation must be able to pay liabilities as due, and total assets must be ≥ total liabilities plus amount needed for superior dissolution preferences unless articles permit otherwise (RCW 23B.06.400(3)) |
Board may use reasonable-in-the-circumstances accounting statements, fair valuation, or another reasonable method (RCW 23B.06.400(4)(a)); qualified reliance on reliable officers/employees, experts, or trusted committee absent contrary knowledge (RCW 23B.08.300); no special reserve formula |
Board fixes record date no earlier than its fixing resolution; default for nonacquisition distribution/share dividend is authorization date (RCW 23B.06.400(2), .230(3)). Acquisition: earlier transfer/debt or status end; ordinary debt: distribution; other payments: approval if ≤120 days, payment if later; conditional-debt payments tested when paid (RCW 23B.06.400(5)); no general revocation rule stated |
Same-class and same-series rights generally identical; articles set distribution preferences (RCW 23B.06.010-.020). Share dividends pro rata by default; cross-class issue needs articles, majority class/series approval, or no outstanding shares (RCW 23B.06.230). Fractions, value cash, disposition arrangement, or conditional scrip (RCW 23B.06.040) |
Compliant distribution debt is at parity with general unsecured debt unless agreement provides otherwise. Conditional-pay debt is excluded from liabilities and each payment retested (RCW 23B.06.400(4)-(6)). Section controls distribution legality where applicable and reaches successor-trust shareholder payments after dissolution; no special security rule; financial application/liability/advice outside scope |
| West Virginia verified 2026-09-04 | West Virginia Business Corporation Act §§ 31D-1-101, -1-150(4), (6), -6-640; ordinary domestic for-profit corporation. Distribution covers direct/indirect money or property, debt, dividends, purchases/redemptions/acquisitions, and distributed debt; own shares excluded. No express liquidation exclusion in §§ 31D-1-150, -6-640 |
Board authorizes, subject to articles and § 31D-6-640(c). Committee cannot authorize distributions; reacquisitions may follow a board formula/method (§ 31D-8-825(e)). A qualifying unanimous shareholder agreement may govern proportional or disproportionate distributions but remains subject to § 31D-6-640 (§ 31D-7-732) |
Direct or indirect money/other property, incurred debt, declared/paid dividends, purchases, redemptions, other share acquisitions, and distributed debt (§ 31D-1-150(6)); corporation's own shares excluded and share dividends follow § 31D-6-623 |
No separate surplus, retained-earnings, net-profit, or stated-capital source test in § 31D-6-640; the two post-distribution tests and governing records control |
After distribution: able to pay debts as due, and total assets ≥ total liabilities plus amount needed for superior dissolution preferences unless articles permit otherwise (§ 31D-6-640(c)) |
Board may use financial statements based on reasonable accounting practices/principles, fair valuation, or another reasonable method (§ 31D-6-640(d)). General director reliance covers delegated performance and records, officers/employees, professionals, and committees (§ 31D-8-830(c)-(e)); no distribution-specific reserve formula |
Board-set distribution record date; default is authorization except a share purchase/redemption/acquisition (§ 31D-6-640(b)). Acquisition: earlier of transfer/debt or status end; other debt: distribution; other payment ≤120 days: authorization, later: payment. No express distribution-revocation rule |
Same-class and same-series preferences/rights ordinarily identical; articles or authorized resolution sets class/series distribution terms (§§ 31D-6-601 to -602). Share dividends pro rata; cross-class issue needs articles, issued-class majority, or no outstanding issued-class shares (§ 31D-6-623). Fractions, value money, disposition, or scrip (§ 31D-6-604). Escrowed-share distributions may be credited/canceled (§ 31D-6-621(e)) |
Compliant distribution debt ranks equally with general unsecured debt unless subordinated. Conditional debt is excluded from liabilities and each payment retested (§ 31D-6-640(f)-(g)); no express liquidation carveout. Liability, bankruptcy, covenant, tax, valuation, and advice issues outside scope |
| Wisconsin verified 2026-09-03 | Wisconsin Business Corporation Law, Wis. Stat. ch. 180; ordinary domestic for-profit corporation. Distribution includes direct/indirect money or property other than own shares, debt, dividends, purchases, redemptions, and other acquisitions; share dividends are separately governed (§§ 180.0103, 180.0623, 180.0640) |
Board authorizes subject to articles and § 180.0640(3). A board committee may exercise delegated distribution authority because current § 180.0825(5) excepts only shareholder-submission matters and bylaws. No general shareholder approval; articles can restrict (§§ 180.0640, 180.0825) |
Direct/indirect money or other property except own shares, incurred debt, dividend declaration/payment, purchase, redemption, other acquisition, or evidences of debt (§ 180.0103(7)); share dividends separately under § 180.0623; redemption may use cash, debt, securities, or property (§ 180.0601(4)(b)) |
No separate surplus, retained-earnings, net-profit, stated-capital, or other capital-source test in § 180.0640; Wisconsin uses the dual post-distribution limits plus articles and class/series terms |
After distribution: corporation must be able to pay debts as due, and assets must be ≥ liabilities plus amount needed for superior dissolution preferences unless articles permit otherwise (§ 180.0640(3)) |
Board may use financial statements and other financial data based on reasonable-in-circumstances accounting practices/principles, or fair valuation or another reasonable method (§ 180.0640(4)); no distribution- specific reserve formula or reliance list |
Board-set distribution record date; default is authorization date except acquisitions. Acquisition: earlier transfer/debt or status end; other debt: distribution; other payments: authorization if ≤120 days, payment if later (§ 180.0640(2), (5)); no general revocation rule |
Same-class/series rights identical subject to permitted series terms; articles set preferences (§ 180.0601). Share dividends are proportional; cross-class issue requires articles, issuing-class majority, or no outstanding shares (§ 180.0623). Fractions, value cash, disposition, or scrip (§ 180.0604) |
Compliant distribution debt is at parity with general unsecured debt unless subordinated; a security interest keeps its validity/priority. Conditional debt may be excluded from liabilities, with principal/interest retested when paid (§ 180.0640(6)–(7)); liquidation, liability, creditor, bankruptcy, covenant, tax, valuation, and advice issues outside scope |
| Wyoming verified 2026-09-04 | Wyoming Business Corporation Act, especially W.S. §§ 17-16-140(a)(iv),(vi), -601, -604, -623, -640; ordinary domestic for-profit corporation; distribution includes money/property transfers, shareholder debt, dividends, purchases, redemptions, other share acquisitions, and other forms, but excludes own-share transfers; liquidation excluded from § 17-16-640 |
Board authorizes subject to articles and § 17-16-640. Specifically authorized committee may approve only under board-prescribed formula/method or limits (§ 17-16-825(e)(i)). Qualifying shareholder agreement may govern authorization/making and disproportionality but remains subject to § 17-16-640 (§ 17-16-732(a)(ii)) |
Direct/indirect money or other property and incurred shareholder debt; declaration/payment of dividend, purchase, redemption, other share acquisition, distributed debt, or another form (§ 17-16-140(a)(vi)). Own shares excluded from distribution definition and issued under separate share-dividend § 17-16-623 |
No separate surplus, retained-earnings, net-profit, stated-capital, or other lawful-source test in § 17-16-640; operative limits are the two post-distribution tests plus articles and class/series terms |
After effect: corporation must be able to pay debts as due in usual course, and total assets cannot be below total liabilities plus superior dissolution preferences unless articles permit otherwise (§ 17-16-640(c)) |
Board may use financial statements based on reasonable-in-the-circumstances accounting practices/principles, fair valuation, or another reasonable method (§ 17-16-640(d)); general § 17-16-830(d)-(f) reliance covers qualifying officers/employees, professionals, or committee. No special reserve formula |
Board-fixed record date; default for non-acquisition distribution is authorization date (§ 17-16-640(b)). Acquisition measured at earlier transfer/debt or end of holder status; debt when distributed; other distribution at authorization if paid within 120 days, otherwise payment (§ 17-16-640(e)). No general revocation rule |
Articles state class/series terms; ordinarily same-class/series terms identical unless express article variation (§ 17-16-601). Share dividend pro rata by default; cross-class issue needs articles, issued-class majority, or no outstanding issued-class shares; default record date is authorization (§ 17-16-623). Fractions, value cash, disposition, or registered/bearer scrip allowed (§ 17-16-604) |
Compliant distribution debt at parity with general unsecured debt unless subordinated (§ 17-16-640(f)). Conditional debt excluded from liabilities and each principal/interest payment retested (§ 17-16-640(g)). Liquidation distributions expressly excluded (§ 17-16-640(h)); insolvency, creditor, tax, accounting, fiduciary, and valuation advice outside scope |
Every jurisdiction we can source is here: 50 of 51, verified against the statute. Ohio is absent because the state publishes no official statute text we are permitted to read and quote, and we will not fill the gap from a secondary source. If that changes, the row goes up.
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Opens in Ezel Pro.
- Starts from the statutes this survey is built on
- Cites every source it relies on, so you can verify it
- Chat, drafting and research in one workspace