(805 ILCS 5/2A.25)
(from Ch. 32, par. 2A.25)
Issuance or transfer of shares of a close corporation in
breach of qualifying conditions.
(a) Every certificate representing shares issued by a close corporation
shall conspicuously set forth upon the face or back of the certificate a
full statement of all restrictions on transfer and the qualifications of
shareholders and the existence of any written agreement permitted under
Section 2A.40. Such full statement may be omitted from the certificate if
it is conspicuously stated upon the face or back of the certificate that
such statement and written agreement, if any, in full, will be furnished by
the corporation to any shareholder upon request and without charge.
(b) Any person to whom certificates representing shares of a close
corporation containing either statement required by subsection (a) of this
Section are issued or assigned is conclusively presumed to have notice (i)
of the fact of his
ineligibility to be a shareholder, (ii) that he has acquired shares in
violation of a restriction on transfer allowed pursuant to this Article,
and (iii) of the provisions of a written agreement permitted under
(c) Whenever any person to whom shares of a close corporation have been
issued or assigned has, or is conclusively presumed under this Section to
have, notice either (i) that he is a person not eligible to be a
shareholder of the corporation, or (ii) that the assignment of shares is in
violation of a restriction on transfer of shares allowed pursuant to this
Article, the corporation shall refuse to register or transfer the shares
into the name of the assignee.
(d) The provisions of subsection (c) of this Section shall not be
applicable if the issuance or transfer of shares has been consented to by
all of the shareholders of each class of the close corporation, or if the
close corporation has amended its articles of incorporation in accordance
with Section 2A.10.
(e) The term "transfer" or "assign" as used in this Section is not
limited to a transfer or assignment for value.
(f) The provisions of this Section do not in any way impair any rights
of an assignee regarding any right to rescind the transaction or to recover
under any applicable warranty, express or implied.
(Source: P.A. 86-1328.)