Iowa Code 490.622 – Liability of shareholders
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1. A purchaser from a corporation of the corporation’s own shares is not liable to the corporation or its creditors with respect to the shares except to pay the consideration for which the shares were authorized to be issued or specified in the subscription agreement.
Terms Used In Iowa Code 490.622
- Articles of incorporation: means the articles of incorporation described in section 490. See Iowa Code 490.140
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
- following: when used by way of reference to a chapter or other part of a statute mean the next preceding or next following chapter or other part. See Iowa Code 4.1
- Liabilities: The aggregate of all debts and other legal obligations of a particular person or legal entity.
- Shareholder: means a record shareholder. See Iowa Code 490.140
- Shares: means the units into which the proprietary interests in a domestic or foreign corporation are divided. See Iowa Code 490.140
2. A shareholder of a corporation is not personally liable for any liabilities of the corporation, including liabilities arising from acts of the corporation, subject to the following exceptions:
a. To the extent provided in a provision of the articles of incorporation permitted by section 490.202, subsection 2, paragraph “b”, subparagraph (5).
b. A shareholder may become personally liable by reason of the shareholder’s own acts or conduct.