Dissenting from Board Action
If the board of directors votes to declare and pay a dividend when the corporation was not entitled to pay it, then the directors themselves can be held personally liable for the amount of the improper dividend. If the director did not attend the meeting, then, as soon as he or she becomes aware of that action, the director should send a registered letter to the corporation's secretary demanding that the director's dissent be recorded in the meeting's minutes. Form 3041 provides the format for a dissent.~

Form 3041:     DIRECTOR'S DISSENT DECLARATION OF DIVIDEND~
DIRECTOR'S DISSENT DECLARATION OF DIVIDEND

Date: > , 19> .
To: > , Secretary, > Corporation
Subject: Dissent from Board Action Declaring Dividend

I hereby notify you of my dissent from the action taken by the Board of Directors of > Corporation at its meeting of > , 19> , at which the Board voted to declare and pay a dividend of > dollars ($> ) per share to all shareholders of record on > , 19> .
As the minutes of that meeting should reflect, I did not attend that meeting. It is my opinion that the dividend authorized by the Board at the aforesaid > , 19> , meeting is illegal because there is no surplus to support the payment.
I hereby demand that you enter my dissent in the minutes of the meeting of > , 19> , from the Board's action authorizing the aforementioned dividend and that you advise each member of the Board of this demand.

Sincerely,

Director, > Corporation