Title 7
Corporations, Associations, and Partnerships
Chapter 1.2
Rhode Island Business Corporation Act
Part 6
Shares Issuance and Distributions
R.I. Gen. Laws § 7-1.2-603
§ 7-1.2-603. Subscription for shares.
(a) A subscription for shares entered into before incorporation is irrevocable for a period of six (6) months unless the subscription agreement provides a longer or shorter period or all the subscribers agree to revocation. A subscription for shares is not enforceable against a subscriber unless in writing and signed by the subscriber or by an agent of the subscriber.
(b) The board of directors may determine the payment terms of subscriptions 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 more than 20 days after the corporation sends written demand for payment to the subscriber.
(e) A subscription agreement entered into on or after incorporation is a contract between the subscriber and the corporation subject to § 7-1.2-604.
History of Section.
P.L. 2004, ch. 216, § 2; P.L. 2004, ch. 274, § 2; P.L. 2005, ch. 120, § 1; P.L. 2005, ch. 130, § 1.