43-38-503 - Assignment of member's financial rights.
43-38-503. Assignment of member's financial rights.
(a) Except as provided in subsection (c), a member's financial rights are transferable in whole or in part.
(b) An assignment of a member's financial rights entitles the assignee to receive, to the extent assigned, only the share of profits and losses and the distributions to which the assignor would otherwise be entitled. An assignment of a member's financial rights does not dissolve the cooperative and does not entitle or empower the assignee to become a member, to cause a dissolution, to exercise any governance rights, or, except as specifically provided by this chapter, to receive any notices from the cooperative, or to cause dissolution. The assignment may not allow the assignee to control the member's exercise of governance rights, and any attempt to do so shall be void.
(c) (1) A restriction on the assignment of financial rights may be imposed in the articles, in the bylaws, by a written resolution adopted by the members, or by a written agreement among, or other written action by, members, or among them and the cooperative.
(2) A restriction on the assignment of financial rights referenced in subdivision (c)(1) that is not manifestly unreasonable under the circumstances is enforceable against the owner of the restricted financial rights. A written restriction on the assignment of financial rights that is not manifestly unreasonable under the circumstances and is noted in the articles or bylaws may be enforced against a successor or transferee of the owner of the restricted financial rights, including a pledge or a legal representative, whether or not the successor or transferee of the owner had actual notice of the restriction. Unless noted in the articles or bylaws, a restriction, even though permitted by this section, is ineffective against a person without knowledge of the restriction.
[Acts 2004, ch. 534, § 17.]