§ 7-106-201 — Subscription for shares

(1) A subscription for shares entered
into before incorporation is irrevocable for six months unless the subscription
agreement provides a longer or shorter period or all the subscribers agree to
revocation before the time the corporation is incorporated and accepts the
subscription.

(2) The acceptance by the corporation of a subscription entered into before
incorporation and the authorization of the issuance of shares pursuant thereto are
subject to section 7-106-202.

(3) The board of directors may determine the payment terms of
subscriptions for shares that were entered into before incorporation, unless the
subscription agreement states them. A call for payment by the board of directors
shall be uniform so far as practicable as to all shares of the same class or series,
unless the subscription agreement states otherwise.

(4) Shares issued pursuant to subscriptions entered into before
incorporation are fully paid and nonassessable when the corporation receives the
consideration stated in the subscription agreement.

(5) If a subscriber defaults in payment of money or other property under a
subscription agreement entered into before incorporation, the corporation may
collect the amount owed as it might collect any other debt. Alternatively, unless the
subscription agreement provides otherwise, the corporation may rescind the
agreement and may sell the shares if the debt remains unpaid more than twenty
days after the corporation sends written demand for payment to the subscriber.

(6) A subscription agreement entered into after incorporation is a contract
between the subscriber and the corporation subject to section 7-106-202.

Legislative History

Source: L. 93: Entire article added, p. 755, � 1, effective July 1, 1994. L. 2003: (3) and (4) amended, p. 2316, � 229, effective July 1, 2004.