§ 14-2-832 - Liability for unlawful distributions - Georgia Statutes

O.C.G.A. 14-2-832 (2010)
14-2-832. Liability for unlawful distributions

(a) A director who votes for or assents to a distribution made in violation of Code Section 14-2-640 or the articles of incorporation is personally liable to the corporation for the amount of the distribution that exceeds what could have been distributed without violating Code Section 14-2-640 or the articles of incorporation if it is established that he did not perform his duties in compliance with Code Section 14-2-830. In any proceeding commenced under this Code section, a director has all of the defenses ordinarily available to a director.

(b) A director held liable under subsection (a) of this Code section for an unlawful distribution is entitled to contribution:

(1) From every other director who could be held liable under subsection (a) of this Code section for the unlawful distribution; and

(2) From each shareholder for the amount the shareholder accepted knowing the distribution was made in violation of Code Section 14-2-640 or the articles of incorporation.

(c) A proceeding under this Code section is barred unless it is commenced within two years after the date on which the effect of the distribution was measured under subsection (e) or (g) of Code Section 14-2-640.