California Corporations Code

§ 501

CORP § 501Div. 1 · Title 1 · Ch. 5

Statute text

Neither a corporation nor any of its subsidiaries shall make any distribution to the corporation’s shareholders (Section 166) if the corporation or the subsidiary making the distribution is, or as a result thereof would be, likely to be unable to meet its liabilities (except those whose payment is otherwise adequately provided for) as they mature.

Legislative history

Repealed and added by Stats. 1975, Ch. 682.