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Texas Business Organizations Code - Section 251.203. Share And Membership Certificates; Recall

Legal Research Home > Texas Lawyer > Business Organizations Code > Texas Business Organizations Code - Section 251.203. Share And Membership Certificates; Recall

§ 251.203. SHARE AND MEMBERSHIP CERTIFICATES;  
RECALL.  (a) The bylaws of a cooperative association may authorize 
the cooperative association's board of directors to recall during a 
specified time and in accordance with the bylaws the membership 
certificates of a member who fails to patronize the cooperative 
association.  The board may use the reserve funds to recall, at par 
value, the membership certificates of any member in excess of the 
amount required for membership.
	(b)  After the board of directors of a cooperative 
association recalls a membership certificate under Subsection (a), 
membership in the cooperative association is terminated and the 
board shall cause the cooperative association to reissue or cancel 
the certificate.  The board of directors may not recall membership 
certificates if recalling the certificates would jeopardize the 
cooperative association's solvency.
	(c)  The board of directors may use the reserve funds to 
recall and repurchase the investment certificates of an investor at 
par value plus any investment dividends due.
	(d)  The bylaws of a cooperative association may establish 
specific procedures, terms, and conditions for recalls and 
repurchases of investment certificates.

Acts 2003, 78th Leg., ch. 182, § 1, eff. Jan. 1, 2006.                     

Last modified: August 11, 2007