Potential Limitation of Stockholder Liability
Section 282 of the Delaware General Corporation Law (“DGCL”) provides for limitations on the potential liability of stockholders where the corporation has complied with the statutory dissolution requirements. If the corporation has complied with either the “elective” or “default” procedure, as discussed in recent posts, Section 282 limits the potential liability of stockholders for claims against the corporation to the lesser of the stockholder’s pro rata share of the claim or the amount distributed to the stockholder in liquidation. See 8 Del. C. § 282(a). The statute also provides that the aggregate liability of any stockholder for claims against the dissolved corporation shall not exceed the amount distributed to the stockholder in dissolution. See 8 Del C. § 282(c).
Additional Protections Provided to Stockholders
The DGCL also provides additional protection to stockholders of a dissolved corporation that has complied with the elective procedure. To start, if the corporation has complied with the elective procedure, the statute operates to extinguish the potential liability of stockholders with respect to any claims against the corporation on which an action, suit, or proceeding is not initiated prior to the expiration of the three-year statutory winding-up period. See 8 Del. C. § 282(b).
Next, stockholders of a corporation that has not elected to comply with the elective procedure will remain subject to claims that the corporation has not adequately complied with the “reasonableness” standards of Section 281(b), and that the Section 282(a) limits on stockholder liability therefore do not pertain. On the other hand, stockholders of a corporation that has complied with the elective procedure should receive the enhanced protection of the Court’s determination of adequate security. In any event, Section 282(c) limits the aggregate liability of any stockholder of a dissolved corporation for claims against the dissolved corporation to the amount distributed to such stockholder in dissolution. 8 Del. C. § 282(c).