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4-27-620. Subscription for shares before incorporation.
Arkansas Code — all titles (historical 2020) · legal_authorities
4-27-620. Subscription for shares before incorporation.
(a) 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.
(b) The board of directors may determine the payment terms of subscription for shares that were entered into before incorporation, unless the subscription agreement specifies them. A call for payment by the board of directors must be uniform so far as practicable as to all shares of the same class or series, unless the subscription agreement specifies otherwise.
(c) Shares issued pursuant to subscriptions entered into before incorporation are fully paid and nonassessable when the corporation receives the consideration specified in the subscription agreement.
(d) If a subscriber defaults in payment of money or property under a subscription agreement entered into before incorporation, the corporation may collect the amount owed as 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 for more than 20 days after the corporation sends written demand for payment to the subscriber.
(e) A corporation that issues shares pursuant to a subscription agreement entered into before incorporation must comply with § 4-27-621(b), (c), and (f). A subscription agreement entered into after incorporation is a contract between the subscriber and the corporation subject to all of the provisions of § 4-27-621.
Source: Arkansas Code — historical release 78 (November 6, 2020) · 4-27-620
Stored review status: Historical 2020-11-06 source release; later amendments not reconciled; machine-extracted, not independently legally reviewed; source heading status: text_in_historical_source. A text match is a research starting point; applicability is not established.
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Stable record: arkansas_code:legal_authorities:4-27-620
Source file: gov.ar.code.title.04.odt
Pages: Not recorded – Not recorded
Passage SHA-256: 5b01384937c2d204a562ede2e4c5947936f6be586de63ef1da64b7f0d808af1a
Source location: content.xml paragraph 16007
Stored source content
4-27-620. Subscription for shares before incorporation.
(a) 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.
(b) The board of directors may determine the payment terms of subscription for shares that were entered into before incorporation, unless the subscription agreement specifies them. A call for payment by the board of directors must be uniform so far as practicable as to all shares of the same class or series, unless the subscription agreement specifies otherwise.
(c) Shares issued pursuant to subscriptions entered into before incorporation are fully paid and nonassessable when the corporation receives the consideration specified in the subscription agreement.
(d) If a subscriber defaults in payment of money or property under a subscription agreement entered into before incorporation, the corporation may collect the amount owed as 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 for more than 20 days after the corporation sends written demand for payment to the subscriber.
(e) A corporation that issues shares pursuant to a subscription agreement entered into before incorporation must comply with § 4-27-621(b), (c), and (f). A subscription agreement entered into after incorporation is a contract between the subscriber and the corporation subject to all of the provisions of § 4-27-621.
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Arkansas Code — all titles (historical 2020) · legal_authorities
4-27-621. Issuance of shares.
(a) The powers granted in this section to the board of directors may be reserved to the shareholders by the articles of incorporation.
(b) The board of directors may authorize shares to be issued for consideration consisting of money paid, labor done, or property actually received. Neither promissory notes nor the promise of future services shall constitute valid consideration for the issuance of shares.
(c) Shares having a par value may not be issued for consideration less than the par value of such shares.
(d) Before the corporation issues shares, the board of directors must determine that the consideration received or to be received for shares to be issued is adequate. That determination by the board of directors is conclusive insofar as the adequacy of consideration for the issuance of shares relates to whether the shares are validly issued, fully paid, and nonassessable.
(e) When the corporation receives the consideration for which the board of directors authorized the issuance of shares, the shares issued therefor are fully paid and nonassessable.
(f) Shares may not be issued until the full amount of the consideration for the shares, fixed as provided by law, has been paid.
Source: Arkansas Code — historical release 78 (November 6, 2020) · 4-27-621
Stored review status: Historical 2020-11-06 source release; later amendments not reconciled; machine-extracted, not independently legally reviewed; source heading status: text_in_historical_source. The source passage cites 4-27-621. This identifies an authority to review, not proof of applicability.