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Title XXIII CORPORATIONS, ASSOCIATIONS AND PARTNERSHIPS

Chapter 351

previous next Effective - 28 Aug 1998bottom

  351.165.  Note or obligation not to be considered payment for original issue shares — corporation shall not lend money to shareholder for purchase of shares — liability. — No note or obligation given by any shareholder, whether secured by deed of trust, mortgage or otherwise, shall be considered as payment of any part of any original issue share or shares, and no loan of money for the purpose of such payment shall be made by the corporation to any shareholder therein; and if such loan shall be made to a shareholder, the officers making it, or who shall assent thereto, shall be jointly and severally liable to the corporation for the repayment of such loan and interest.

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(RSMo 1939 § 5349, A.L. 1943 p. 410 § 18, A.L. 1979 S.B. 216, A.L. 1998 S.B. 680)

Prior revisions: 1929 § 4944; 1919 § 10155; 1909 § 3350

(1964) Sale of negotiable notes from stockholders to loan and investment company held not to be void or illegal because part of consideration for sale of notes was the payment or cancellation of loans that had been made to the stockholder in variation of this section. Holt v. Queen City Loan and Investment, Inc. (Mo.), 377 S.W.2d 393.


---- end of effective   28 Aug 1998 ----

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