Illinois Statutes Chapter 805. Business Organizations § 5/2A.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 Section 2A.40.

(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.