S.D. Codified Laws § 47-1A-833

Current through the 2024 Legislative Session

Section 47-1A-833 - Directors' liability for unlawful distributions

A director who votes for or assents to a distribution in excess of what may be authorized and made pursuant to § 47-1A-640 or 47-1A-1409 is personally liable to the corporation for the amount of the distribution that exceeds what could have been distributed without violating § 47-1A-640 or 47-1A-1409 if the party asserting liability establishes that when taking the action the director did not comply with §§ 47-1A-830 and 47-1A-830.1. A proceeding to enforce the liability of a director under this section is barred unless it is commenced within two years after the date:

(1) On which the effect of the distribution was measured under § 47-1A-640.2 or 47-1A-640.4;

(2) As of which the violation of § 47-1A-640 occurred as the consequence of disregard of a restriction in the articles of incorporation; or

(3) On which the distribution of assets to shareholders under § 47-1A-1409 was made.

SDCL 47-1A-833

SL 2005, ch 239, §162.