A corporation or a subsidiary of a corporation may not make a distribution to the corporation's shareholders on any shares of its stock of a class or series that is junior to outstanding shares of another class or series with respect to payment of dividends unless the amount of the retained earnings of the corporation immediately before the distribution equals or exceeds the amount of the proposed distribution plus the aggregate amount of the cumulative dividends in arrears on all shares having a preference with respect to payment of dividends over the class or series to which the distribution is made.
AS 10.06.365
Prohibited distribution on junior shares; relationship to retained earnings
Known as the Alaska Corporations Code
The act spans §§ 10–10 (251 sections).
Official source: Alaska State Legislature. Reproduced from public-domain Alaska statutes; confirm against the official source for the current text. Not legal advice.