§ 16-6a-610 — Purchase of memberships.

(1) Unless otherwise provided in the articles of incorporation or the bylaws, a nonprofit corporation may not purchase the membership of a member:

(1)(a) who resigns; or
(1)(b) whose membership is terminated.
(2) (2)(a) If so authorized, a nonprofit corporation may purchase the membership of a member who resigns or whose membership is terminated for the amount and pursuant to the conditions set forth in or authorized by:
(2)(a)(i) its articles of incorporation or its bylaws; or
(2)(a)(ii) agreement with the affected member.
(2)(b) A payment permitted under Subsection (2)(a) may not violate:
(2)(b)(i) Section 16-6a-1301; or
(2)(b)(ii) any other provision of this chapter.
(3) A mutual benefit corporation may purchase a member's membership if, after the purchase is completed:

(3)(a) the mutual benefit corporation would be able to pay its debts as they become due in the usual course of its activities; and
(3)(b) the mutual benefit corporation's total assets would at least equal the sum of its total liabilities.
(4) A water company may purchase the shares of a shareholder who is delinquent in payment of shareholder assessments, in accordance with Chapter 4, Share Assessment Act.

Legislative History

Amended by Chapter 358, 2017 General Session