§ 23-1-20-7 — "Distribution"

(a) "Distribution" means a direct or indirect
transfer of money or other property (except a corporation's own shares)
or incurrence or transfer of indebtedness by a corporation to or for the
benefit of its shareholders in respect of any of its shares under IC 23-1-28. A distribution may be in the form of a declaration or payment
of a dividend; a purchase, redemption, or other acquisition of shares;
a distribution of indebtedness; or otherwise.
(b) The term does not include:
(1) amounts constituting reasonable compensation for past or
present services or reasonable payments made in the ordinary
course of business under a bona fide retirement plan or other
benefit program; or
(2) the making of or payment or performance upon a bona fide
guaranty or similar arrangement by a corporation to or for the
benefit of its shareholders.
However, the failure of an amount to satisfy subdivision (1), or of a
payment or performance to satisfy subdivision (2), is not determinative
of whether the amount, payment, or performance is a distribution.

Legislative History

As added by P.L.149-1986, SEC.4. Amended by P.L.130-2006, SEC.3.