Sec. 10.06.675. Recovery of amounts improperly distributed.

281 words·~1 min read·/ak/title-10/chapter-6/10-06-675

A research copy — for the controlling text, always check the official state or federal source. Not legal advice.

(a)If a distribution of assets has been made in the process of winding up a corporation without a court order and without prior payment or adequate provision for payment of the debts and liabilities of the corporation, the amount improperly distributed to a shareholder may be recovered by the corporation. Shareholders who received an improper distribution may be joined as a party in the same action.

(b)Suit may be brought in the name of the corporation to enforce the liability under

(a)of this section against a shareholder receiving an improper distribution by a creditor of the corporation, whether or not the creditor has reduced the claim of the creditor to judgment.

(c)A shareholder who satisfies a liability under this section has the right of ratable contribution from other distributees who are similarly liable. A shareholder who has been compelled to return to the corporation more than the shareholder's ratable share of the amount needed to pay the debts and liabilities of the corporation may require that the corporation recover from any or all of the other distributees the proportion of the amounts received by them by the improper distribution necessary to give contribution to shareholders held liable under this section and to make the distribution of the assets fair and ratable, according to the respective rights and preferences of the shares, after payment or adequate provision for payment of all the debts and liabilities of the corporation.

(d)In this section, “process of winding up” includes proceedings under AS 10.06.605 — 10.06.678 and other distributions of assets to shareholders made in contemplation of termination or abandonment of the corporate business.