Section 47-1A-732.2 - Existence of agreement to be noted on certificate--Right of rescission onpurchase of shares without notice of agreement. - South Dakota Statutes

47-1A-732.2. Existence of agreement to be noted on certificate--Right of rescission on purchase of shares without notice of agreement. The existence of an agreement authorized by § 47-1A-732 shall be noted conspicuously on the front or back of each certificate for outstanding shares or on the information statement required by § 47-1A-626. If, at the time of the agreement, the corporation has shares outstanding represented by certificates, the corporation shall recall the outstanding certificates and issue substitute certificates that comply with this section. The failure to note the existence of the agreement on the certificate or information statement does not affect the validity of the agreement or any action taken pursuant to it. Any purchaser of shares who, at the time of purchase, did not have knowledge of the existence of the agreement is entitled to rescission of the purchase. A purchaser is deemed to have knowledge of the existence of the agreement if its existence is noted on the certificate or information statement for the shares in compliance with this section and, if the shares are not represented by a certificate, the information statement is delivered to the purchaser at or prior to the time of purchase of the shares. An action to enforce the right of rescission authorized by this section must be commenced within the earlier of ninety days after discovery of the existence of the agreement or two years after the time of purchase of the shares.

Source: SL 2005, ch 239, § 118.