New Jersey Statutes 15A:7-2. Restrictions on transfer of memberships
Terms Used In New Jersey Statutes 15A:7-2
- 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.
- Evidence: Information presented in testimony or in documents that is used to persuade the fact finder (judge or jury) to decide the case for one side or the other.
- Jurisdiction: (1) The legal authority of a court to hear and decide a case. Concurrent jurisdiction exists when two courts have simultaneous responsibility for the same case. (2) The geographic area over which the court has authority to decide cases.
- person: includes corporations, companies, associations, societies, firms, partnerships and joint stock companies as well as individuals, unless restricted by the context to an individual as distinguished from a corporate entity or specifically restricted to one or some of the above enumerated synonyms and, when used to designate the owner of property which may be the subject of an offense, includes this State, the United States, any other State of the United States as defined infra and any foreign country or government lawfully owning or possessing property within this State. See New Jersey Statutes 1:1-2
- State: extends to and includes any State, territory or possession of the United States, the District of Columbia and the Canal Zone. See New Jersey Statutes 1:1-2
b. If memberships are transferable, any reasonable restriction on the transfer of memberships may be enforced against the members. The restrictions shall be valid only if imposed by the certificate of incorporation or bylaws or by a written agreement among any number of members. Unless noted conspicuously on the certificate or other written evidence representing memberships, a restriction shall not be valid against a person who becomes a member without actual knowledge of the restriction.
c. In particular and without limitation of the generality of the power granted by subsection b. of this section to impose restrictions, a restriction on the transfer of memberships may be enforced, if it:
(1) Obligates the member to offer to the corporation or to any other members a prior opportunity to acquire the membership;
(2) Obligates the corporation to purchase the membership;
(3) Requires the corporation to consent to any proposed transfer of the membership or to approve the proposed transferee; or
(4) Prohibits the transfer of the membership to designated persons or classes of persons, and the designation is not manifestly unreasonable.
d. If a restriction on transfer of memberships is held not to be authorized by the law of this State, the corporation shall nevertheless have an option for a period of 30 days after the judgment setting aside the restriction becomes final, to acquire the membership at a price to be agreed upon by the parties, or if an agreement is not reached as to price, then at its fair value as determined by any court having jurisdiction. In order to determine fair value, the court may appoint an appraiser to receive evidence and report to the court the findings and recommendations as to fair value.
L.1983, c. 127, s. 15A:7-2, eff. Oct. 1, 1983.