14A:5-30. Liability of subscribers and shareholders

266 words·~1 min read·/nj/title-14a/chapter-5/14a-5-30

A research copy — for the controlling text, always check the official state or federal source. Not legal advice.

Liability of subscribers and shareholders.

(1)A holder of or subscriber for shares of a corporation shall be under no obligation to the corporation or its creditors to pay for such shares other than the obligation to pay to the corporation the unpaid portion of the consideration for which such shares were issued or to be issued, which in no event shall be less than the amount of the consideration for which such shares could be lawfully issued.

(2)Unless otherwise provided in the articles of incorporation, a shareholder of a corporation is not personally liable for the acts of the corporation, except that a shareholder may become personally liable by the reason of his own acts or conduct.

(3)A person holding stock in a fiduciary or representative capacity shall not be personally liable to the corporation as the holder of or subscriber for shares of a corporation but the estate and funds in his hands shall be so liable.

(4)Any person becoming an assignee or transferee of shares or of a subscription for shares in good faith and without knowledge or notice that the full consideration therefor has not been paid shall not be liable to the corporation or its creditors for any unpaid portion of such consideration, but the original holder or subscriber and any assignee or transferee prior to an assignment or transfer to a person taking in good faith and without such knowledge or notice shall remain liable therefor.

(5)No pledgee or other holder of shares as collateral security shall be liable as a shareholder.

L.1968, c.350; amended 1995,c.279,s.7.