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Utah Code Title 16. Corporations § 16-6a-610. Purchase of memberships

Current as of January 01, 2025 | Updated by Findlaw Staff

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

(a) who resigns; or

(b) whose membership is terminated.

(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:

(i) its articles of incorporation or its bylaws; or

(ii) agreement with the affected member.

(b) A payment permitted under Subsection (2)(a) may not violate:

(i)Section 16-6a-1301; or

(ii) any other provision of this chapter.

(3) A mutual benefit corporation may purchase a member's membership if, after the purchase is completed:

(a) the mutual benefit corporation would be able to pay its debts as they become due in the usual course of its activities; and

(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.

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Cite this article: FindLaw.com - Utah Code Title 16. Corporations § 16-6a-610. Purchase of memberships - last updated January 01, 2025 | https://codes.findlaw.com/ut/title-16-corporations/ut-code-sect-16-6a-610/

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