Transferability of shares restricted: board approval, nominee succession, and mandatory surrender govern producer company share transfers. Transferability of shares in a producer company is generally prohibited except by prior Board approval for transfers to active members at par; members must nominate a successor for their shares who acquires rights on death, with the Board transferring shares to the nominee or directing surrender if the nominee is not a producer. The Board may also direct surrender of shares where a member ceases to be a primary producer or fails to meet membership qualifications, but only after written notice and an opportunity to be heard.
Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
Provisions expressly mentioned in the judgment/order text.
Transferability of shares restricted: board approval, nominee succession, and mandatory surrender govern producer company share transfers.
Transferability of shares in a producer company is generally prohibited except by prior Board approval for transfers to active members at par; members must nominate a successor for their shares who acquires rights on death, with the Board transferring shares to the nominee or directing surrender if the nominee is not a producer. The Board may also direct surrender of shares where a member ceases to be a primary producer or fails to meet membership qualifications, but only after written notice and an opportunity to be heard.
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