(215 ILCS 5/32.1) (from Ch. 73, par. 644.1)
(Section scheduled to be repealed on January 1, 2017)
Sec. 32.1. Stock option plans. A company subject to this Article which has done business in Illinois for 3 or more years and which has adopted a stock option plan shall submit that plan to the Director. Unless the Director finds that such stock option plan creates an inequity, fraud, or deception upon shareholders of the company, the Director shall approve such plan and issue a permit to the company authorizing the issuance of such shares of stock as optionees under the plan are entitled from time to time to acquire by the exercise of their options, including an adjustment in the number of shares to be issued as may at any time be appropriate due to the increase or decrease in the number of shares resulting from any share dividend, and subdivision or combination of shares, or any reorganization, merger, consolidation, or other recapitalization or change in the corporate structure or shares of the company. A stock option plan is deemed prima facie as not creating any inequity, fraud, or deception upon shareholders if it complies with applicable provisions of the Internal Revenue Code in effect at the time of the adoption of the plan and continues in compliance with those provisions or other new provisions of the Internal Revenue Code as it hereafter may be amended; provided, however, that the number of shares in respect to such plan together with the number of shares in respect of which unexpired options are outstanding or may be granted under any and all option plans of the company shall in no event exceed 10% of the total shares outstanding. The permit is effective with respect to all shares issued at any time to optionees under the plan. After receipt of the permit and upon receipt by the company of the full purchase price for any shares to be issued to any optionee, the company may issue such shares to any such optionee without further authorization from the Director. If a plan approved by the Director is amended, no shares may be issued under the plan as amended until the amendment, or the plan as amended, has been approved by the Director. Upon such approval, the permit previously issued shall be deemed to authorize the issuance of shares under the plan as amended. A permit or permits to issue shares under this Section may be outstanding in addition to any outstanding permit to issue shares for any other purpose.
On or before the 25th day of each month a company which issued shares during the preceding month under this Section shall provide the Director with the following information and affidavit:
(1) a list of the names of the individuals to whom
were issued shares during the preceding month under the stock option plan;
(2) the number of shares and a description of the
shares issued to each individual;
(3) the date of each issue;
(4) the price per share and total price paid by each
said individual; and
(5) an affidavit signed by either the president, a
vice president, the secretary, or the treasurer of the company under oath averring that the dollar consideration due from each such individual was actually received by the company before the issuance of those shares. Such information and affidavit shall be accompanied by the company's request for a certificate of paid-up capital.
After receiving the information and affidavit and satisfying himself as to the accuracy thereof, the Director shall issue a certificate of paid-up capital which shall be recorded by the company with the recorder of the county in which the principal office of the company is located, within 15 days from the date of the issuance of the certificate. No bond or cash deposit with the Director is required with respect to shares issued under this Section.
(Source: P.A. 83-358.)
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Last modified: February 18, 2015