(215 ILCS 5/23) (from Ch. 73, par. 635)
(Section scheduled to be repealed on January 1, 2027)
Sec. 23.
Deposit of proceeds of shares - When subscribers deemed shareholders.
(1) The cash or securities received by the company upon subscriptions
for shares shall be placed in the bank or trust company designated in the
escrow and subscription agreements. No part of the
cash or securities so deposited
shall be used by the company prior to the issuance to it of a certificate
of authority to transact business, except when payments for all the shares to be issued and sold, as set forth
in the articles of incorporation, are completed, for the purpose of making
the deposit as provided for in Section 26.
(2) Any officer, director or incorporator of a company who, prior to the
issuance of the certificate of authority to the company, withdraws, causes
to be withdrawn or knowingly permits the withdrawal of any cash or
securities on deposit in such bank or trust company, for any purposes other
than those authorized in subsection (1), shall be guilty of a Class A
misdemeanor.
(3) The subscribers shall be deemed to be shareholders when full payment
upon the subscriptions for all shares which the company proposes to issue
and sell, as set forth in the articles of incorporation, shall have been
received by the company, but no certificate for shares may be issued by the
company prior to the issuance to it of a certificate of authority to
transact business.
(4) In the event that payments for all shares to be issued and sold by
the company, as set forth in the articles of incorporation, are not
completed within the time provided in the permit of the Director
authorizing the solicitation of subscriptions the cash and securities
received in payment shall be returned to the subscribers who have made the
payments.
(Source: P.A. 84-502.)
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