CHAPTER 28. DISTRIBUTIONS TO SHAREHOLDERS

IC 23-1-28
    Chapter 28. Distributions to Shareholders

IC 23-1-28-1
Distributions
    Sec. 1. A board of directors may authorize and the corporationmay make distributions to its shareholders subject to restriction bythe articles of incorporation and the limitation in section 3 of thischapter.
As added by P.L.149-1986, SEC.12.

IC 23-1-28-2
Record date, declaration date, and payment date
    Sec. 2. The board of directors may fix a record date, declarationdate, and payment date with respect to any share dividend ordistribution to a corporation's shareholders. If the board of directorsdoes not fix the record date for determining shareholders entitled toa distribution (other than one involving a repurchase or reacquisitionof shares), it is the date the board of directors authorizes thedistribution.
As added by P.L.149-1986, SEC.12.

IC 23-1-28-3
Prohibited distributions
    Sec. 3. A distribution may not be made if, after giving it effect:
        (1) the corporation would not be able to pay its debts as theybecome due in the usual course of business; or
        (2) the corporation's total assets would be less than the sum ofits total liabilities plus (unless the articles of incorporationpermit otherwise) the amount that would be needed, if thecorporation were to be dissolved at the time of the distribution,to satisfy the preferential rights upon dissolution ofshareholders whose preferential rights are superior to thosereceiving the distribution.
As added by P.L.149-1986, SEC.12.

IC 23-1-28-4
Basis for determination that distribution not prohibited
    Sec. 4. The board of directors may base a determination that adistribution is not prohibited under section 3 of this chapter either onfinancial statements prepared on the basis of accounting practicesand principles that are reasonable in the circumstances or on a fairvaluation or other method that is reasonable in the circumstances.
As added by P.L.149-1986, SEC.12.

IC 23-1-28-5
Measuring effect of distribution; date
    Sec. 5. The effect of a distribution under section 3 of this chapteris measured:
        (1) in the case of distribution by purchase, redemption, or other

acquisition of the corporation's shares, as of the earlier of:
            (A) the date money or other property is transferred or debtincurred by the corporation; or
            (B) the date the shareholder ceases to be a shareholder withrespect to the acquired shares;
        (2) in the case of any other distribution of indebtedness, as ofthe date the indebtedness is distributed; and
        (3) in all other cases, as of:
            (A) the date the distribution is authorized if the paymentoccurs within one hundred twenty (120) days after the dateof authorization; or
            (B) the date the payment is made if it occurs more than onehundred twenty (120) days after the date of authorization.
As added by P.L.149-1986, SEC.12.

IC 23-1-28-6
Indebtedness to shareholder; priority
    Sec. 6. A corporation's indebtedness to a shareholder incurred byreason of a distribution made in accordance with this chapter is atparity with the corporation's indebtedness to its general, unsecuredcreditors except to the extent subordinated by agreement.
As added by P.L.149-1986, SEC.12.