§ 5003 — Subscription for shares; time of payment, forfeiture for default

§ 5003. Subscription for shares; time of payment, forfeiture for\ndefault. 1. Unless otherwise provided by the terms of the subscription,\na subscription for shares of a corporation to be formed shall be\nirrevocable, except with the consent of all other subscribers or the\ncorporation, for a period of seven months from its date.\n 2. A subscription, whether made before or after the formation of a\ncorporation, shall not be enforceable unless in writing and signed by\nthe subscriber.\n 3. Unless otherwise provided by the terms of the subscription,\nsubscriptions for shares, whether made before or after the formation of\na corporation, shall be paid in full at such time, or in such\ninstalments and at such times, as shall be determined by the board. Any\ncall made by the board for payment on subscriptions shall be uniform as\nto all shares of the same class or of the same series. If the\nsuperintendent has taken possession of the business and property of the\ncorporation, all unpaid subscriptions shall be paid at such times and in\nsuch instalments as the superintendent may direct.\n 4. In the event of default in the payment of any instalment or call\nwhen due, the corporation may proceed to collect the amount due in the\nsame manner as any debt due the corporation or the board may declare a\nforfeiture of the subscriptions. The subscription agreement may\nprescribe other penalties, not amounting to forfeiture, for failure to\npay instalments or calls that may become due. No forfeiture of the\nsubscription shall be declared as against any subscriber unless the\namount due thereon shall remain unpaid for a period of thirty days after\nwritten demand has been made therefor. If mailed, such written demand\nshall be deemed to be made when deposited in the United States mail in a\nsealed envelope addressed to the subscriber at his last post-office\naddress known to the corporation, with postage thereon prepaid. Upon\nforfeiture of the subscription, if at least fifty percent of the\nsubscription price has been paid, the shares subscribed for shall be\noffered for sale for cash at a price at least sufficient to pay the full\nbalance owed by the delinquent subscriber plus the expenses incidental\nto such sale, and any excess of net proceeds realized over the amount\nowed on such shares shall be paid to the delinquent subscriber or to his\nlegal representative. If no prospective purchaser offers a cash price\nsufficient to pay the full balance owed by the delinquent subscriber\nplus the expenses incidental to such sale, or if less than fifty percent\nof the subscription price has been paid, the shares subscribed for shall\nbe cancelled and restored to the status of authorized but unissued\nshares and all previous payments thereon shall be forfeited to the\ncorporation and transferred to surplus.\n