Directors' Resolution to Pay a Dividend (Circulating Resolution)This Directors' Resolution can be used to decided, on behalf of the company, to pay a dividend to shareholders.
A company can pay dividends to its shareholders upon a resolution of the board. Under section 249T of the Corporations Act 2001 (Cth), the company can only pay dividends where:
- its assets exceed its liabilities;
- the payment of the dividend is fair and reasonable to the shareholders; and
- the payment of the dividend does not prejudice the company's ability to pay its creditors.
This resolution is effective for both final and interim dividends.
The company should be careful with how it structures its dividend payment. It should follow the procedure set out in replaceable rule 249U of the Corporations Act 2001, or the company constitution if it specifies such a procedure. Any complex details should be advised on by a lawyer.
This resolution can be inserted into:
Where you wish to pass the resolution in a directors' meeting, you must use the documents above. Simply copy and paste the text of the resolution.