Section: Effect of enactment of Revised Statutes upon existing offices, etc., and the incumbents thereof
(1) In addition to any other liabilities imposed by law upon directors of a corporation, directors who vote for, or concur in, any of the following corporate actions
(a) the declaration of any dividend or other distribution of assets to the shareholders contrary to the provisions of this act or contrary to any restrictions contained in the certificate of incorporation;
(b) the purchase of the shares of the corporation contrary to the provisions of this act or contrary to any restrictions contained in the certificate of incorporation;
(c) the distribution of assets to shareholders during or after dissolution of the corporation without paying, or adequately providing for, all known debts, obligations and liabilities of the corporation, except that the directors shall be liable only to the extent of the value of assets so distributed and to the extent that such debts, obligations and liabilities of the corporation are not thereafter paid, discharged, or barred by statute or otherwise;
(d) the complete liquidation of the corporation and distribution of all of its assets to its shareholders without dissolving or providing for the dissolution of the corporation and the payment of all fees, taxes, and other expenses incidental thereto, except that the directors shall be liable only to the extent of the value of assets so distributed and to the extent that such fees, taxes, and other expenses incidental to dissolution are not thereafter paid;
(e) the making of any loan to an officer, director or employee of the corporation or of any subsidiary thereof contrary to the provisions of this act;
shall be jointly and severally liable to the corporation for the benefit of its creditors or shareholders, to the extent of any injury suffered by such persons, respectively, as a result of any such action.
(2) Any director against whom a claim is successfully asserted under this section shall be entitled to contribution from the other directors who voted for, or concurred in, the action upon which the claim is asserted.
(3) Directors against whom a claim is successfully asserted under this section shall be entitled, to the extent of the amounts paid by them to the corporation as a result of such claims,
(a) upon payment to the corporation of any amount of an improper dividend or distribution, to be subrogated to the rights of the corporation against shareholders who received such dividend or distribution with knowledge of facts indicating that it was not authorized by this act, in proportion to the amounts received by them respectively;
(b) upon payment to the corporation of any amount of the purchase price of an improper purchase of shares, to have the corporation rescind such purchase of shares and recover for their benefit, but at their expense, the amount of such purchase price from any seller who sold such shares with knowledge of facts indicating that such purchase of shares by the corporation was not authorized by this act;
(c) upon payment to the corporation of the claim of any creditor by reason of a violation of paragraph 14A:6-12(1)(c), to be subrogated to the rights of the corporation against shareholders who received an improper distribution of assets;
(d) upon payment to the corporation of the amount of any loan made improperly, to be subrogated to the rights of the corporation against the person who received the improper loan.
(4) A director shall not be liable under this section if, in the circumstances, he discharged his duty to the corporation under section 14A:6-14.
(5) Every action against a director for recovery upon a liability imposed by subsection 14A:6-12(1) shall be commenced within six years next after the cause of any such action shall have accrued.
L.1968, c.350; amended by L.1973, c. 366, s. 27, eff. May 1, 1974.
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