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New York Business Corporations Law Section 510 - Dividends Or Other Distributions In Cash Or Property.Legal Research Home > New York Lawyer > Business Corporations > New York Business Corporations Law Section 510 - Dividends Or Other Distributions In Cash Or Property.
§ 510. Dividends or other distributions in cash or property.
(a) A corporation may declare and pay dividends or make other
distributions in cash or its bonds or its property, including the shares
or bonds of other corporations, on its outstanding shares, except when
currently the corporation is insolvent or would thereby be made
insolvent, or when the declaration, payment or distribution would be
contrary to any restrictions contained in the certificate of
incorporation.
(b) Dividends may be declared or paid and other distributions may be
made out of surplus only, so that the net assets of the corporation
remaining after such declaration, payment or distribution shall at least
equal the amount of its stated capital; except that a corporation
engaged in the exploitation of natural resources or other wasting
assets, including patents, or formed primarily for the liquidation of
specific assets, may declare and pay dividends or make other
distributions in excess of its surplus, computed after taking due
account of depletion and amortization, to the extent that the cost of
the wasting or specific assets has been recovered by depletion reserves,
amortization or sale, if the net assets remaining after such dividends
or distributions are sufficient to cover the liquidation preferences of
shares having such preferences in involuntary liquidation.
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Last modified: August 9, 2006 |