Ling And Co. v. Trinity Savings And Loan Association

482 S.W.2d 841 (1972)

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Nature of the Case

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Facts

Trinity Savings and Loan Association (P) sued Bruce Bowman for the balance of a promissory note and to foreclose on 1500 shares of Ling and Co. (D) pledged as security on the note. D is a member corporation of the Exchange. Then Section E(4) prevents the sale of the stock without first affording the corporation the opportunity to buy and, if it fails to purchase, giving that opportunity to all holders of the same class of stock. The court of civil appeals struck down the restrictions: the lack of conspicuous notice thereof on the stock certificate, the unreasonableness of the restrictions, and statutory prohibition against an option in favor of other stockholders whenever they number more than twenty. This appeal resulted.