16-16-604 - Security interest and set-off.
16-16-604. Security interest and set-off.
(1) A member or transferee may create an enforceable security interest in its financialrights in a limited cooperative association.
(2) Unless the organic rules otherwise provide, a member may not create an enforceablesecurity interest in the member's governance rights in a limited cooperative association.
(3) The organic rules may provide that a limited cooperative association has a securityinterest in the financial rights of a member to secure payment of any indebtedness or otherobligation of the member to the association. A security interest provided for in the organic rulesis enforceable under, and governed by, Title 70A, Chapter 9a, Uniform Commercial Code -Secured Transactions.
(4) Unless the organic rules otherwise provide, a member may not compel the limitedcooperative association to offset financial rights against any indebtedness or obligation owed tothe association.
Enacted by Chapter 363, 2008 General Session