Published: 2015-07-08
Key Benefits:
This chapter does not apply to any proceeding for winding up and dissolution of corporations under Chapters 15 (commencing with Section 8510), 16 (commencing with Section 8610), and 17 (commencing with Section 8710).
(Added by Stats. 1978, Ch. 567.)
(a) Except as provided in subdivision (b), no corporation shall make any distribution except upon dissolution.
(b) A corporation may, subject to meeting the requirements of Sections 7412 and 7413 and any additional restrictions authorized by Section 7414, purchase or redeem memberships.
(Amended by Stats. 1979, Ch. 724.)
Neither a corporation nor any of its subsidiaries shall make a distribution if the corporation or the subsidiary making the distribution is, or as a result thereof would be, likely to be unable to meet its liabilities (except those whose payment is otherwise adequately provided for) as they mature.
(Added by Stats. 1978, Ch. 567.)
Neither a corporation nor any of its subsidiaries shall purchase or redeem a membership of the parent or subsidiary if the articles of the corporation contain a provision authorized by paragraph (4), clause (ii), of subdivision (a) of Section 7132 and such corporation or the subsidiary making the purchase or redemption is, or as a result thereof would be, likely to be unable to meet the obligations resulting from such article provision.
(Amended by Stats. 1979, Ch. 724.)
Nothing in this chapter prohibits additional restrictions upon the purchase or redemption of a membership by provision in a corporation’s articles or bylaws or agreement entered into by the corporation.
(Added by Stats. 1978, Ch. 567.)