New York § 1510 - 1510Death or disqualification of shareholders

§ 1510. 1510Death or disqualification of shareholders

§ 1510. Death or disqualification of shareholders. (a) A professional service corporation, including a design professional service corporation, shall purchase or redeem the shares of a shareholder in case of his death or disqualification pursuant to the provisions of section 1509 of this article, within six months after the appointment of the executor or administrator or other legal representative of the estate of such deceased shareholder, or within six months after such disqualification, at the book value of such shares as of the end of the month immediately preceding the death or disqualification of the shareholder as determined from the books and records of the corporation in accordance with its regular method of accounting. The certificate of incorporation, the by-laws of the corporation or an agreement among the corporation and all shareholders may modify this section by providing for a shorter period of purchase or redemption, or an alternate method of determining the price to be paid for the shares, or both. If the corporation shall fail to purchase or redeem such shares within the required period, a successful plaintiff in an action to recover the purchase price of such shares shall also be awarded reasonable attorneys' fees and costs. Limitations on the purchase or redemption of shares set forth in section 513 of this chapter shall not apply to the purchase or redemption of shares pursuant to this section. Nothing herein contained shall prevent a corporation from paying pension benefits or other deferred compensation to or on behalf of a former or deceased officer, director or employee thereof as otherwise permitted by law. The provisions of this section shall not be deemed to require the purchase of the shares of a disqualified shareholder where the period of disqualification is for less than six months, and the shareholder again becomes eligible to practice his profession within six months from the date of disqualification. (b) Notwithstanding the provisions of paragraph (a) of this section, the corporation shall not be required to purchase or redeem the shares of a deceased or disqualified shareholder if such shares, within the time limit prescribed by paragraph (a) of this section, are sold or transferred to another professional pursuant to the provisions of section 1511 of this article.