Sec. 5. (a) A corporation may not declare or pay any dividends to its shareholders in any form if, by the payment of the dividends, its capital stock will be thereby impaired.
(b) Unless approved by the director, a corporation may not pay a dividend in an amount greater than the remainder of undivided profits then on hand after deducting losses, bad debts, or depreciation that the department may have determined, and all other expenses.
(c) A corporation must obtain department approval before reducing the corporation's capital stock, capital surplus, or preferred stock.