N.Y. Banking Law § 7016: Liability of directors in certain cases

§ 7016. Liability of directors in certain cases. 1. Directors of a

corporation, who vote for or concur in the declaration of any dividend

or other distribution to stockholders which impairs its capital stock or

while its capital stock is impaired, impairs any surplus fund or reserve

which is not available for dividends under section one hundred ten,

section three hundred nine-a or section five hundred seventeen of this

chapter, or is contrary to any restrictions contained in its

organization certificate, shall be jointly and severally liable to the

corporation for the benefit of its creditors and stockholders, to the

extent of any injury suffered by such persons, respectively, as a result

of such action.

2. A director who is present at a meeting of the board, or any

committee thereof, at which action specified in subdivision one of this

section is taken shall be presumed to have concurred in the action

unless his dissent thereto shall be entered in the minutes of the

meeting, or unless he shall submit his written dissent to the person

acting as the secretary of the meeting before the adjournment thereof,

or shall deliver or send by registered mail such dissent to the

secretary of the corporation promptly after the adjournment of the

meeting. Such right to dissent shall not apply to a director who voted

in favor of such action. A director who is absent from a meeting of the

board, or any committee thereof, at which such action is taken shall be

presumed to have concurred in the action unless he shall deliver or send

by registered mail his dissent thereto to the secretary of the

corporation or shall cause such dissent to be filed with the minutes of

the proceedings of the board or committee within a reasonable time after

learning of such action.

3. 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.

4. 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, upon payment to the

corporation of any amount of an improper dividend or distribution, to be

subrogated to the rights of the corporation against stockholders who

received such dividend or distribution with knowledge of facts

indicating that it was within the scope of subdivision one of this

section, in proportion to the amounts received by them respectively,

unless such amount has been returned by the stockholder to the

corporation.

5. A director shall not be liable under this section if, in the

circumstances, he discharged his duty to the corporation under section

seven thousand fifteen.

6. This section shall not affect any liability otherwise imposed by

law upon any director.