17-6404. Same; designation of part of consideration as capital; surplus and net assets defined.
17-6404
17-6404. Same; designation of part of consideration as capital;
surplus and net assets defined.
Any corporation, by resolution of its board of directors, may determine
that only a part of the consideration which shall be received by the
corporation for any of the shares of its capital stock which it shall issue
from time to time shall be capital; but, in the event that any of the
shares issued shall be shares having a par value, the amount of the part of
such consideration so determined to be capital shall be in excess of the
aggregate par value of the shares issued for such consideration having a
par value, unless all the shares issued shall be shares having a par value,
in which case the amount of the part of such consideration so determined to
be capital need be only equal to the aggregate par value of such shares. In
each such case, the board of directors shall specify in dollars the part of
such consideration which shall be capital. If the board of directors shall
not have determined what part of the consideration for such shares shall be
capital (1) at the time of issue of any shares of the capital stock of the
corporation issued for cash or (2) within 60 days after the issue
of any shares of the capital stock of the corporation issued for property
other than cash, the capital of the corporation in respect of such shares
shall be an amount equal to the aggregate par value of such shares having a
par value, plus the amount of the consideration for such shares without par
value. The amount of the consideration so determined to be capital in
respect of any shares without par value shall be the stated capital of such shares.
The capital of the corporation may be increased from time to time by
resolution of the board of directors, directing that a portion of the net
assets of the corporation in excess of the amount so determined to be
capital be transferred to the capital account. The board of directors may
direct that the portion of such net assets so transferred shall be treated
as capital in respect of any shares of the corporation of any designated
class or classes. At any given time, the excess, if any, of the net assets
of the corporation over the amount so determined to be capital shall be
surplus. Net assets means the amount by which total assets exceed total
liabilities, but capital and surplus are not liabilities for this purpose.
History: L. 1972, ch. 52, § 31;
L. 1988, ch. 99, § 11; Revived and amend., L. 1988, ch. 100, § 11; May 5.