Section 2-206 - Payment for stock and convertible securities. - Maryland Statutes

§ 2-206. Payment for stock and convertible securities.
 

(a)  What constitutes consideration.- The consideration for the issuance of stock, convertible securities, warrants, or options may consist in whole or in part of: 

(1) Money; 

(2) Tangible or intangible property; 

(3) Labor or services actually performed for the corporation; 

(4) A promissory note or other obligation for future payment in money; or 

(5) Contracts for labor or services to be performed. 

(b)  Future labor or services, or obligations for future payment.- The corporation may place in escrow shares issued for a contract for future labor or services or a promissory note or other obligation for future payment in money, or make other arrangements to restrict the transfer of the shares, and may credit distributions in respect of the shares against their purchase price, until the labor or services are performed or the note or other obligation for future payment in money is paid. If the labor or services are not performed or the note or other obligation for future payment in money is not paid, the shares escrowed or restricted and the distributions credited may be canceled in whole or in part. 

(c)  When fully paid and nonassessable.- When the corporation receives the consideration for which stock or convertible securities are to be issued, the stock or convertible securities are fully paid and nonassessable. 

(d)  Qualifying as real estate investment trust.- Notwithstanding any other provision of the Maryland General Corporation Law, a corporation may issue shares of its stock without consideration for the purpose of qualifying the corporation as a real estate investment trust under the Internal Revenue Code. 
 

[An. Code 1957, art. 23, §§ 19, 22; 1975, ch. 311, § 2; 1976, ch. 567, § 2; 1993, ch. 624; 2000, ch. 642; 2005, ch. 586.]