Assigning Membership Interests: Consequences to the Assignor and Assignee

Abstract

Corporate stock is freely assignable. Absent a stock restriction agreement or similar private ordering to the contrary, a stockholder may unilaterally assign the stock to another. Upon assignment, the assignee succeeds to all of the rights of a stockholder. Those rights include the right to interim and liquidating dividends, to vote with respect to matters put to the shareholders both as to the election of directors and organic transactions such as a merger or an amendment of the articles of incorporation, to inspect corporate records, and to enjoy the benefits of the fiduciary obligations owed by the board of directors.