Reference no: EM132219612

F.B.I. Farms, Inc. was formed by Ivan and Thelma Burger, their children, Linda and Freddy, and the children’s spouses. Each of the three couples transferred a farm and related machinery to the corporation in exchange for common stock. At the time, Birchell Moore was married to Linda. The board of directors of F.B.I. adopted the fol- lowing restrictions on the transfer of shares: (1) F.B.I. and its present shareholders held a right of first refusal to purchase at book value and (2) if F.B.I. or its shareholders did not exercise their right of first refusal, any “blood member” of the family could pur- chase at book value. When Linda’s marriage to Moore was dissolved, she was awarded all of the F.B.I. shares and Moore was awarded a monetary judgment in the amount of $155,889.80, secured by a lien on Linda’s shares. Ultimately, a sheriff’s sale was held and Moore, who was aware of the restrictions, purchased all of Linda’s shares for $290,450.67. Moore now claims that the transfer restrictions are not enforceable because they are unreasonable. Should the court invalidate the transfer restrictions because they are unreasonable? Explain.