F.B.I. Farms, Inc. v. Moore

BOEHM, Justice.

We hold that as a general proposition, restrictions on corporate share transfers may require approval of the transfer by the corporation's Board of Directors, at least in a family-owned corporation. Although generally valid against purchasers with notice of them, such restrictions may not prevent a creditor from foreclosing a lien on the shares, but a purchaser who buys at a foreclosure sale with notice of the restrictions acquires the shares subject to the restrictions. We also hold that if shares are subject to a right of first refusal, and the holder of the right has notice…