44-1876 - Arizona Statutes

44-1876. Escrow of certain securities; restrictive sales agreement A. Except as provided in section 44-1901, as a condition to registration of securities under this chapter, the commission may in its discretion by order require that securities issued for or which are intended to be issued for a patent right, copyright, trademark, process, formula, goodwill, option, lease, assignment, service, or other intangible asset, or for fees or expenses in connection with the promotion or organization of the issuer, shall be subject to a restrictive sales agreement or shall be deposited in escrow in some depository satisfactory to the commission under an escrow agreement subject to the orders of the commission as to withdrawal or termination, and whereby the owners of the securities shall not be entitled to sell or transfer the securities without the consent of the commission. Any security that is subject to a restrictive sales agreement shall have a legend on the back of the security that states that the security is subject to a restrictive sales agreement. B. In the event of dissolution or insolvency of the issuer during the time such securities are held in escrow, the owners of the securities shall not participate in any distribution of assets until after the owners of all other securities have been paid in full.