Montana Code 35-9-202. Share transfer prohibition
35-9-202. Share transfer prohibition. (1) An interest in shares of a statutory close corporation may not be voluntarily or involuntarily transferred, by operation of law or otherwise, except to the extent permitted by the articles of incorporation or under 35-9-203.
Terms Used In Montana Code 35-9-202
- Bankruptcy: Refers to statutes and judicial proceedings involving persons or businesses that cannot pay their debts and seek the assistance of the court in getting a fresh start. Under the protection of the bankruptcy court, debtors may discharge their debts, perhaps by paying a portion of each debt. Bankruptcy judges preside over these proceedings.
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
- Executor: A male person named in a will to carry out the decedent
- Lineal descendant: Direct descendant of the same ancestors.
- Trustee: A person or institution holding and administering property in trust.
- Writing: includes printing. See Montana Code 1-1-203
(2)Except to the extent the articles of incorporation provide otherwise, this section does not apply to a transfer:
(a)to the corporation or to any other holder of the same class or series of shares;
(b)to members of the shareholder’s immediate family or to a trust, all of whose beneficiaries are members of the shareholder’s immediate family, which immediate family consists of the shareholder’s spouse, parents, lineal descendants including adopted children and stepchildren and the spouse of any lineal descendant, and brothers and sisters;
(c)that has been approved in writing by all of the holders of the corporation’s shares having general voting rights;
(d)to an executor or administrator upon the death of a shareholder or to a trustee or receiver as the result of a bankruptcy, insolvency, dissolution, or similar proceeding brought by or against a shareholder;
(e)by merger or share exchange under Title 35, chapter 14, part 11, or an exchange of existing shares for other shares of a different class or series in the corporation;
(f)by a pledge as collateral for a loan that does not grant the pledgee any voting rights possessed by the pledgor; and
(g)made after termination of the corporation’s status as a statutory close corporation.