15A:7-2. Restrictions on transfer of memberships

a. Memberships of a corporation shall be personal property and, unless otherwise provided in the certificate of incorporation or bylaws, are not transferable and terminate upon the death of the member.

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.