A corporation shall not redeem its shares, or purchase its redeemable shares in lieu of redemption, if at the time of, or as a result of, such transaction:
(1) There is a reasonable ground for believing that the corporation would be unable to meet its obligations as they become due in the ordinary course of business; or
(2) The remaining assets of the corporation would be less than one and one-fourth (1¼) times the amount of its liabilities to creditors; or
(3) If by the redemption or purchase the net assets would be reduced below the aggregate amount payable to the holders of shares to remain outstanding which have prior or equal rights to the assets of the corporation upon dissolution; or
(4) If there exist any unpaid accrued preferential dividends with respect to any shares having priority as to dividends over the shares to be redeemed or purchased.
Structure Arkansas Code
Title 4 - Business and Commercial Law
Subtitle 3 - Corporations and Associations
Chapter 26 - Business Corporations Generally
Subchapter 6 - Corporate Finance
§ 4-26-601. Authorized shares generally — Preferred or special classes
§ 4-26-602. Shares of preferred or special classes — Issuance in series
§ 4-26-603. Subscriptions for shares
§ 4-26-604. Consideration for shares generally
§ 4-26-605. Payment for shares
§ 4-26-606. Payment of expenses of organization, reorganization, financing, etc
§ 4-26-607. Stated capital — Capital surplus — Earned surplus
§ 4-26-608. Signed certificates representing shares
§ 4-26-609. Issuance of fractional shares or scrip
§ 4-26-610. Restrictions on transfer of shares
§ 4-26-611. Acquisition or disposition of corporation's own shares
§ 4-26-612. Treasury shares — Cancellation
§ 4-26-613. Redeemable shares — Restrictions on redemption or purchase
§ 4-26-614. Redeemable shares — Cancellation by redemption or purchase
§ 4-26-615. Reduction of stated capital
§ 4-26-616. Surplus, net profits, and valuation of assets
§ 4-26-617. Dividends — General powers of board
§ 4-26-619. Dividends other than in shares of the corporation