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The Vermont Statutes Online

The Vermont Statutes Online have been updated to include the actions of the 2023 session of the General Assembly.

NOTE: The Vermont Statutes Online is an unofficial copy of the Vermont Statutes Annotated that is provided as a convenience.

Title 11: Corporations, Partnerships and Associations

Chapter 007: Cooperatives

  • Subchapter 001: Provisions Relating to Cooperatives Formed Under General Corporation Law
  • § 981. Use of “cooperative.”

    A corporation formed under chapters 1 and 17 of this title shall not have the word “cooperative” or any abbreviation thereof as part of its name, unless the corporation is a worker cooperative corporation organized under chapter 8 of this title, a cooperative housing corporation organized under chapter 14 of this title, or the articles of association contain all of the following provisions:

    (1) Each shareholder shall have only one vote in all matters pertaining to the management of the corporation.

    (2) The interest or dividend on the paid up capital stock of the corporation shall not exceed six percent per annum.

    (3) There shall be set aside annually not less than ten percent of the net profits of the corporation for a reserve fund until there is accumulated a fund of not less than 50 percent of the paid up capital stock.

    (4) The remainder of the earnings, or any part thereof, shall be distributed by a uniform dividend upon the amount of purchases or sales through the corporation by the shareholders, or the amount of raw material furnished to, or business done through, the corporation by the shareholders; and such profits or earnings shall be distributed as often as once in 12 months.

    (5) Not more than ten percent of the capital stock of such corporation shall be owned by any one member.

    (6) Certificates of stock in cooperative corporations shall contain a statement on the face thereof that the holder is entitled to only one vote thereon. (Amended 1985, No. 46, § 3; 1987, No. 254 (Adj. Sess.), § 3, eff. June 16, 1988.)

  • Subchapter 002: The Cooperative Marketing Act
  • § 991. Definitions

    In this subchapter, unless the context or subject matter otherwise requires:

    (1) “Agricultural products” includes horticultural, viticultural, forestry, dairy, livestock, poultry, bee, and any farm products.

    (2) “Association” means any corporation organized under this chapter.

    (3) “Associations” organized hereunder means nonprofit associations.

    (4) “Consumers’ cooperative” means a corporation organized under this chapter for the acquisition and distribution for the benefit of ultimate consumers of property, goods, commodities, or services.

    (5) “Handcraft product” means any product fashioned primarily by hand with the final form and its characteristics shaped by hand and produced in the home or a small craft center by the artisan or craftsman in a skilled or artistic process rather than in an assembly line technique.

    (6) “Marketing cooperative” means a corporation organized under this chapter for the marketing of agricultural or handcraft products.

    (7) “Member” includes actual members of associations without capital stock and holders of common stock in associations organized with capital stock.

    (8) “Person” includes individuals, firms, partnerships, corporations and associations.

    (9) “Railroad cooperative” means any corporation organized under this chapter for the organization, acquisition, and operation of a general transportation business by railroad, including truck, bus, air, and water transportation subsidiaries of the railroad. (Amended 1973, No. 90, § 1.)

  • § 992. Use of “cooperative”

    The use of the word “cooperative” as a part of the name of any person is hereby limited to such persons as are legally organized and chartered under the provisions of this chapter or chapter 8 or 14 of this title. (Amended 1985, No. 46, § 4; 1987, No. 254 (Adj. Sess.), § 4, eff. June 16, 1988; 2011, No. 84 (Adj. Sess.), § 2, eff. April 20, 2012.)

  • § 993. Subscribers

    Five or more persons, a majority of whom are residents of this State, may form a nonprofit, cooperative association, with or without capital stock, under the provisions of this subchapter.

  • § 994. Powers

    Each association incorporated under this subchapter shall have the following powers:

    (1) In the case of a marketing cooperative, the power to engage in any activity in connection with the purchasing, marketing, selling, preserving, harvesting, drying, processing, manufacturing, canning, packing, grading, storing, handling, or utilization of any agricultural or handcraft products or the manufacturing or marketing of the by-products thereof, any activity in connection with the purchase, hiring, or use by its members of supplies, machinery or equipment, and in financing any of the aforementioned activities. However, a marketing association shall not handle agricultural or handcraft products of nonmembers to an extent greater in value than the products of its own members which it handles. In the case of a consumers’ cooperative, the power to engage in any one or more lawful mode or modes of acquiring, producing, building, operating, manufacturing, furnishing, exchanging, or distributing any type of property, commodities, goods, or services for the primary and mutual benefit of the patrons of the association, or their patrons, if any, as ultimate consumers. In the case of a railroad cooperative, to engage in any activity in connection with the organization, acquisition, and operation of a subsidiary transportation business, whether by means of railroad, truck, water carrier, air, or other. Such a corporation formed under this subchapter shall have any other rights, powers, and privileges granted by the laws of this State to corporations in a like business organized under the general laws of this State.

    (2) To have perpetual succession in its corporate name unless incorporated or formed for a limited term, or dissolved as provided by law.

    (3) To borrow money without limitations as to amount of corporate indebtedness or liability.

    (4) To make advance payments, and advances to members.

    (5) To act as the agent or representative of any member or members in any of the above mentioned activities.

    (6) To acquire, to exercise all rights of ownership or control in, and to sell, transfer, or pledge, or guarantee the payment of dividends or interest on, or the retirement or redemption of, shares of the capital stock or bonds of any corporation or association engaged in any related activity or in the warehousing, handling, marketing, sale, or distribution of any of the products, property, commodities, or goods handled by the association.

    (7) To establish reserves and invest the funds thereof in bonds or in such other property as may be provided in the bylaws.

    (8) To buy, hold, and exercise all privileges of ownership over such real or personal property as may be necessary or convenient for the conduct and operation of any of the business of the association, or business incidental thereto.

    (9) To establish, secure, own, and develop patents, trademarks, trade names, and copyrights.

    (10) To do everything necessary, suitable, or proper for the accomplishment of any of the purposes or the attainment of any of the objects herein enumerated, or conducive to or expedient for the interest or benefit of the association, and to contract accordingly; to exercise and possess all powers, rights, and privileges necessary or incidental to the purposes for which the association is organized or to the activities in which it is engaged, and, in addition, any other rights, powers, and privileges granted by the laws of this State to corporations organized under the general laws of this State, except such as are inconsistent with the express provisions of this subchapter; and to do any such thing anywhere. (Amended 1973, No. 90, § 2.)

  • § 995. Articles

    Each association formed under this subchapter shall prepare and file articles of incorporation setting forth:

    (1) The name of the association.

    (2) The purpose for which it is formed.

    (3) The place where its principal business will be transacted.

    (4) The names and addresses of the directors thereof who are to serve until the election and qualification of their successors.

    (5) The name and residence of the clerk.

    (6) When organized without capital stock, whether the property rights and interest of the members are equal, and, if unequal, the general rules applicable to all members by which the property rights and interest, respectively, of each member shall be determined and fixed, and provision for the admission of new members who shall be entitled to share in the property of the association in accordance with such general rules. This provision or paragraph of the certificate of organization shall not be altered, amended, or replaced except by the written consent or vote representing three-fourths of the members.

    (7) When organized with capital stock, the amount of such stock, the number of shares into which it is divided, and the par value thereof.

    (8) The capital stock may be divided into preferred and one or more classes of common stock. When so divided, the certificate of organization shall contain a statement of the number of shares of stock to which preference is granted, the number of shares of stock to which no preference is granted, and the nature and definite extent of the preference and privileges granted to each.

    (9) The articles of incorporation of any association organized under this subchapter may provide that the members or stockholders thereof shall have the right to vote in person or through another method of communication, including through a telecommunications or electronic medium, but a member or stockholder may not vote by proxy. This provision or paragraph of the articles of association shall not be altered and shall not be subject to amendment.

    (10) In addition to the foregoing, the articles of incorporation of any association incorporated hereunder may contain any provision consistent with law with respect to management, regulation, government, financing, indebtedness, membership, the establishment of voting districts and the election of delegates for representative purposes, the issuance, retirement, and transfer of its stock, if formed with capital stock, or any provisions relative to the way or manner in which it shall operate or with respect to its members, officers, or directors and any other provisions relating to its affairs.

    (11) The certificate shall be subscribed by the incorporators and shall be sworn to by one or more of them; and shall be filed with the Secretary of State. A certified copy shall also be filed with the Secretary of Agriculture, Food and Markets.

    (12) When so filed, the certificate of organization or a certified copy thereof shall be received in the courts of this State as prima facie evidence of the facts contained therein and of the due incorporation of such association. (Amended 2003, No. 42, § 2, eff. May 27, 2003; 2015, No. 157 (Adj. Sess.), § B.1, eff. June 2, 2016.)

  • § 996. Amendment of certificate

    The certificate of organization may be altered or amended except as otherwise provided in this subchapter at any regular meeting or any special meeting called for that purpose. An amendment must first be approved by two-thirds of the directors and adopted by a vote of two-thirds of the members or delegates present and voting at such meeting. Amendments to the certificate of organization, when so adopted, shall be filed in accordance with the provisions of section 995 of this title.

  • § 997. Fee

    For filing a certificate of organization, an association shall pay $20.00 to the Secretary of State, and for filing an amendment thereto, $10.00. (Amended 1963, No. 37, § 4; 1967, No. 278 (Adj. Sess.), § 7.)

  • § 998. Members

    Under the terms and conditions prescribed in its bylaws, a marketing cooperative may admit as members, or issue common stock to, only cooperative marketing associations legally formed under the laws of this State, or persons engaged in the production of the agricultural or handcraft products to be handled by or through the association, including the lessees and tenants of land used therefor, and any lessors and landlords who receive any part of the agricultural or handcraft products produced on the leased premises or of the sale price of such product as rent. Under the terms and conditions prescribed in its bylaws, a consumers’ cooperative may admit as members any natural persons, associations, incorporated or unincorporated groups organized on a cooperative basis, or any nonprofit groups. Under the terms and conditions prescribed in its bylaws, a railroad cooperative may admit as members, or issue stock to, any nonprofit organizations, any persons, corporations, or associations who are patrons of its services. (Amended 1973, No. 90, § 3.)

  • § 999. Proxies

    If a member of a nonstock association be other than a natural person, such member may be represented by any individual, associate, officers, manager, or member thereof duly authorized in writing.

  • § 1000. Adoption of bylaws

    (a) Within 30 days after its organization, each association shall adopt for its government and management a code of bylaws, not inconsistent with the powers granted hereby. Except as provided in subsection (b) of this section, a majority vote of the members shall be necessary to adopt, alter, amend, or repeal such bylaws.

    (b) In the case of any association having district election of delegates and delegate system of voting as permitted by subdivision 995(10) of this title, in which, under its articles of association or bylaws, such delegates have complete voting power on behalf of the membership for every purpose except that of their own election and the election of district directors, following reasonable notice to the members or stockholders in accordance with the bylaws, a majority of the delegates attending and voting at any meeting of the delegates of the association may adopt, alter, amend, or repeal such bylaws. (Amended 1971, No. 87, § 1, eff. April 16, 1971.)

  • § 1001. Contents of bylaws

    Each association may provide in its bylaws for any or all of the following matters:

    (1) The time, place, and manner of calling and conducting its meetings.

    (2) The number of stockholders or members constituting a quorum.

    (3) The number of directors constituting a quorum.

    (4) The qualifications, compensation, duties, and term of office of directors and officers; the time of their election; and the mode and manner of giving notice thereof.

    (5) Reasonable penalties for violations of the bylaws.

    (6) The amount of entrance, organization, and membership fees, if any; the manner of collecting the same; and the purposes for which they may be used.

    (7) The amount which each member or stockholder shall be required to pay annually or from time to time, if at all, to carry on the business of the association; the charges, if any, to be paid by each member or stockholder for services rendered by the association to him and the time of payment and manner of collection; and the marketing contract between the association and its members or stockholders, which every member or stockholder may be required to sign.

    (8) The number and qualification of members or stockholders of the association and the conditions precedent to membership or ownership of common stock; the method, time, and manner of permitting members to withdraw or the holders of common stock to transfer their stock; the manner of assignment and transfer of the interest of members and of the shares of common stock; the conditions upon which and time when a membership shall cease; the automatic suspension of the rights of a member when he ceases to be eligible to membership; the manner and effect of the expulsion of a member; the manner of determining the value of a member’s interest and provision for its purchase by the association upon the death or withdrawal of a member or stockholder, or upon the expulsion of a member or forfeiture of his or her membership, or, at the option of the association, the purchase at a price fixed by conclusive appraisal by a board of appraisers. But in no case shall it be provided that the value or price of the stock shall be determined by any board on which the association shall have any greater voice than the member or his or her representative.

    (9) The basis of voting by the members or stockholders, especially whether votes of all members shall be equal, or in proportion to the land area leased or used by each member for production of the products handled by the association, or in proportion to the quantity of such products delivered by or handled for each member or stockholder, or such other basis as may be determined. Unless otherwise provided, no member or stockholder shall be entitled to more than one vote regardless of the number of shares of common stock owned by him or her.

    (10) In the case of a consumer’s or railroad cooperative, the method of distributing among members or stockholders and patrons, both members and nonmembers, the net savings derived from the excess of total income over operating expenses. Provision may be made for the accumulation of reserve funds out of net savings.

  • § 1002. Meetings

    Each association shall by its bylaws provide for one or more regular meetings annually.

  • § 1003. Special meetings

    The board of directors shall have the right to call a special meeting of the members or stockholders of the association at any time. They shall call one upon the petition of not less than ten percent of the members or stockholders, stating the specific business to be brought before the association.

  • § 1004. Notice of meetings

    Notice of each meeting, together with a statement of the purposes thereof, shall be mailed or telegraphed to each member at least ten days prior to the meeting.

  • § 1005. Place of meetings

    Meetings of the members or stockholders of the association, regular or special, shall be held at such place within or outside this State as may be determined from time to time by the board of directors. (Added 1971, No. 87, § 2, eff. April 16, 1971.)

  • § 1006. Directors

    The business of the association shall be managed by a board of not less than five directors, elected by the members or stockholders from their own number.

  • § 1007. Classification of directors

    The bylaws may provide that the territory in which the association has members shall be divided into districts and that the directors shall be elected according to such districts by the members in that district. In such case, the bylaws shall specify the number of directors to be elected by each district, and the manner and method of reapportioning the directors and of redistricting the territory covered by the association.

  • § 1008. Primary elections for directors

    The bylaws may provide that primary elections shall be held in each district, to elect the directors apportioned to such districts, and that the result of all such primary elections may be ratified by the next regular meeting of the association or may be deemed the act of the association.

  • § 1009. Appointment of directors by public officials

    The bylaws may provide that one or more directors may be appointed by any public official or commission or by the other directors selected by the members or their delegates. Such directors shall represent primarily the interest of the general public in such associations and need not be members or stockholders of the association, but shall have the same powers and rights as other directors. Such directors shall not number more than one-fifth of the entire board.

  • § 1010. Vacancies on board of directors

    When a vacancy on the board of directors occurs other than by expiration of term, the remaining members of the board shall fill the vacancy by a majority vote, unless the bylaws provide for an election of directors by districts. In such a case, the board of directors shall immediately call a special meeting of the members, or stockholders, to fill the vacancy in the district where it exists.

  • § 1011. Contracts with directors

    During the term of his or her office, a director shall not be a party to a contract for profit with the association differing in any way from the business relations accorded each member or holder of common stock of the association or others, or upon terms differing from those generally current in that district.

  • § 1012. Executive committee

    The bylaws may provide for an executive committee and may allot to such committee all the functions and powers of the board of directors, subject to the general direction and control of that board.

  • § 1013. Officers

    The directors shall elect from their number a president and one or more vice presidents. They shall also elect a secretary, who shall be the clerk of the corporation, and a treasurer, who need not be directors or members of the association. The directors may combine the two latter offices and designate the combined office as that of secretary-treasurer, or unite both functions and titles in one person. The treasurer may be a bank or any depository, and as such, shall not be considered as an officer, but as a function of the board of directors, and in such case, the secretary shall perform the usual accounting duties of the treasurer, except that the funds shall be deposited only as and where authorized by the board of directors.

  • § 1014. Salaries

    An association may provide a fair compensation for the time actually spent by its officers and directors in its service and for the service of the members of its executive committee. The bylaws may provide that a director or officer shall not occupy any position in the association on regular salary or substantially full time pay.

  • § 1015. Issue of stock

    An association shall not issue stock to a member until it has been fully paid for. The promissory notes of the members may be accepted by the association as full or partial payment. The association shall hold the stock as security for the payment of the note, but such retention as security shall not affect the member’s right to vote. Until such notes are paid in full, the corresponding stock, to the extent of unpaid balances, shall be carried on the books of the association and upon all financial statements made by the association as “capital stock issued for notes,” and the notes shall be carried on such books and statements as “notes given for capital stock.”

  • § 1016. Liability of members for debts

    A member shall not be liable for the debts of the association.

  • § 1017. Preferred stock

    An association organized with stock may issue preferred stock but such stock shall have no voting privileges. Such stock may be issued on such terms and with such preferences as the board of directors may determine and may be sold to any person, member or nonmember, and may be redeemable or retirable by the association on such terms and conditions as may be provided in the certificate of organization and printed on the face of the stock certificate.

  • § 1018. Marketing contracts—Terms

    An association and its members may make and execute marketing contracts, requiring the members to sell, for any period of time, all or any specified part of their agricultural products or specified commodities exclusively to or through the association or any facilities to be created by the association. If they contract a sale to the association, it shall be conclusively held that title to the products passes to the association upon delivery except for legally recorded chattel mortgages given for value and prior to July 1 in any year on such products or commodities whether such mortgages are given before or after the making of such contract of sale. The contract may provide, among other things, that the association may sell or resell the products delivered by its members, with or without taking title thereto, and pay over to its members the resale price, after deducting all necessary selling, overhead and other costs and expenses, including interest or dividends on stock, not exceeding eight percent per annum, and reserves for retiring the stock, if any, and other proper reserves, and for any other reductions.

  • § 1019. Damages

    The bylaws or the marketing contract may fix, as liquidated damages, a specific sum to be paid by a member or stockholder to the association upon the breach by him or her of any provision of the marketing contract regarding the sale or delivery or withholding of products; and may further provide that the member shall pay all costs, premiums for bonds, expenses, and fees, in case any action is brought upon the contract by the association. Any such provisions shall be valid and enforceable in the courts of this State. Such clauses providing for liquidated damages shall be enforceable as such and shall not be regarded as penalties.

  • § 1020. Enjoining breach

    In case of any such breach or threatened breach of such marketing contract by a member, a Superior Court may restrain by injunction further breach of the contract and may decree specific performance thereof. Pending the termination of such an action and upon filing a verified complaint showing the breach or threatened breach, and upon filing a sufficient bond, such court may grant a temporary restraining order against the member. (1973, No. 193 (Adj. Sess.), § 3, eff. April 9, 1974.)

  • § 1021. Liability of landowner, landlord or lessor

    In any action upon such marketing agreement, it shall be conclusively presumed that a landowner, landlord, or lessor is able to control the delivery of products produced on his or her land by tenants or others, whose tenancy, possession, or work on such land, or the terms of whose tenancy, possession, or labor thereon, were created or changed after execution by the landowner, landlord, or lessor of such a marketing agreement. In such action, the foregoing remedies for nondelivery or breach shall lie and be enforceable against such landowner, landlord, or lessor.

  • § 1022. Payment in stock

    When an association with preferred capital stock shall purchase the stock or any property or interest, it may discharge the obligation so incurred, wholly or in part, by exchanging for the acquired interest shares of its preferred capital stock to an amount which at par value would equal the fair market value of the stock, property, or interest so purchased, as determined by the board of directors. In that case the transfer to the association of the stock or interest purchased shall be equivalent to payment in cash for the shares of stock issued.

  • § 1023. Ownership or control of other corporations

    An association may organize, form, operate, own, control, have an interest in, own stock of, or be a member of, any other corporation or corporations, with or without capital stock, and engaged in preserving, drying, processing, canning, packing, storing, handling, shipping, utilizing, manufacturing, marketing, or selling the agricultural products handled by the association or byproducts thereof.

  • § 1024. Warehouse receipts

    When such corporations are warehousing corporations, they may issue negotiable or nonnegotiable warehouse receipts of the association against the commodities delivered, and such warehouse receipts shall be considered as adequate collateral to the extent of the usual and current value of the commodity represented thereby. In case such warehouse is licensed, or licensed and bonded, under the laws of this or any other state of the United States, its warehouse receipt delivered to the association on commodities of the association or its members, or delivered by the association or by its members, shall not be challenged or discriminated against because of ownership or control, wholly or in part, by the association.

  • § 1025. Joint agreements

    Upon resolution adopted by its board of directors, an association may enter into all necessary and proper contracts or arrangements with any other cooperative corporation, association, or associations, formed in this or in any other state, for the cooperative and more economical carrying on of its business or any part thereof. Any two or more associations may, by an agreement, unite in employing and using or may separately employ and use the same personnel, methods, means, and agencies for carrying on and conducting their respective businesses.

  • § 1026. Annual report

    An association formed under this subchapter shall prepare and submit at its annual meeting an annual report containing the name of the association, its principal place of business, a general statement of its business operations during the fiscal year, showing the amount of capital stock paid for and the number of stockholders, if a stock association, or the number of members and amount of membership fees received, if a nonstock association, the total expenses of operation, and the amount of its assets and indebtedness or liabilities.

  • § 1027. Foreign corporations

    A corporation or association organized under generally similar laws of another state shall be allowed to carry on any proper activities, operations, and functions in this State upon compliance with the general regulations applicable to foreign corporations desiring to do business in this State. All contracts which could be made by an association incorporated hereunder, made by or with such association, shall be legal and valid and enforceable in this State with all of the remedies set forth in this subchapter.

  • § 1028. Application to existing corporations

    By a majority vote of its directors, and the vote in meeting assembled of the holders of two-thirds of the outstanding stock, or, if the stock is divided into classes, by the vote of the holders of two-thirds of each class of outstanding stock, a corporation or association, organized under previously existing statutes, may be brought under the provisions of this subchapter by limiting its membership and adopting the other restrictions as provided herein. It shall make out in duplicate a statement signed and sworn to by a majority of its directors to the effect that the corporation or association, by a majority vote of the directors, and the vote in meeting assembled of the holders of two-thirds of the outstanding stock, or, if the stock is divided into classes, by the vote of the holders of two-thirds of each class of outstanding stock, has decided to accept the benefits and be bound by the provisions of this subchapter and has authorized all changes accordingly. Articles of incorporation shall be filed as required in section 995 of this title, except that they shall be signed by the members of the then board of directors. The filing fee shall be the same as for filing an amendment to the certificate of organization.

  • § 1029. Soliciting breach of contract

    A person or corporation whose officers or employees knowingly induce or attempt to induce a member or stockholder of an association organized hereunder, or organized under similar statutes of other states, with similar restrictions and rights and operating in this State by legal authority, to breach his marketing contract with the association, or who maliciously and knowingly spreads false reports about the finances or management or activity thereof, shall be fined not less than $100.00 nor more than $1,000.00, and shall be liable to the association aggrieved in a civil suit in the penal sum of $500.00 for each offense.

  • § 1030. Conspiracies or combinations in restraint of trade

    An association organized under this subchapter and complying with the terms hereof shall not be deemed to be a conspiracy or a combination in restraint of trade or an illegal monopoly or an attempt to lessen competition, or to fix prices arbitrarily. The marketing contracts and agreements between the association and its members and any agreements authorized in this subchapter shall not be deemed illegal as such or in unlawful restraint of trade or as a part of a conspiracy or combination to accomplish an improper or illegal purpose.

  • § 1031. Penalties

    An officer or director who shall subscribe or make oath to any certificate provided for in sections 995 and 996 of this title, which shall contain a false statement, known by such person to be false or who shall do any act relative to the issue of capital stock which is not permitted by section 1015 of this title, or who shall make or publish any financial statement which he or she knows does not comply with the provisions of such sections, shall be fined not more than $5,000.00, or imprisoned not more than five years, or both, and shall also be individually liable to a stockholder of the association or other person for damage caused by reason thereof.

  • Subchapter 003: Consolidation of Cooperative Associations
  • § 1061. Procedure

    Two or more cooperative associations organized under, or which have adopted the provisions of subchapter 1 of this chapter, or similar laws of other states, whether having or not having capital stock, may merge or consolidate into one cooperative association which may be a new cooperative association or one of the constituent cooperatives by complying with the following requirements:

    (1) Notice of the proposed merger or consolidation, to which shall be attached a copy of the articles therefor in the form prescribed in subdivision (3) of this section, shall be mailed by each consolidating cooperative to its members, its stockholders of every class, the holders of its certificates of beneficial interest, and its former members to whom an allocated reserve is credited on its books, and published in a newspaper of general circulation in the area served by such consolidating cooperative not less than 30 days before the date of the meeting at which the consolidating cooperative acts upon such proposal.

    (2) Any present or past member of any consolidating cooperative having a property interest therein evidenced by its stock or its certificates of beneficial interest, or by an allocated reserve, may, not later than 10 days before the holding of such meeting, make a demand in writing upon the consolidating cooperative for payment of such property interest. If, upon the expiration of 60 days from the time the merger or consolidation is completed, the consolidating cooperative and all demandants have not agreed upon the value of the demandants’ interest, such consolidating cooperative shall, within 60 days thereafter, apply by petition to the Superior Court in the county where such consolidating cooperative is domiciled for the determination of the value in appropriate securities or cash, as the board of directors of the newly formed cooperative shall determine, of the interest of each demandant who has made a demand in writing for payment of his property interest, as hereinbefore set forth, and who has not agreed thereto. Such petition shall state the names and addresses of each and every person who has made demand within the time specified and in the manner above provided. The consolidating cooperative shall notify each such demandant by mailing a copy of the petition and citation by registered mail, return receipt requested, to each demandant at his address as the same appears upon the books of the consolidating cooperative or to such other address as the court shall direct. Such notice shall be in lieu of any other notice, statutory or otherwise, and shall be sufficient to bring all parties so notified and the subject matter of the petition within the jurisdiction of the court. However, within 30 days from the mailing of such copy of the petition above referred to, the demandant, at his or her option, instead of proceeding as above set forth, may have such value ascertained by three disinterested persons, one of whom shall be named by the demandant, another by the consolidating cooperative, and the third by the two so named. The findings of these appraisers shall be final, and if their award is not paid by the consolidating cooperative within 30 days after it is made and notice given to the consolidating cooperative, the award may be recovered by the demandant of the consolidating cooperative in a civil action on this statute. The suit shall be stayed pending the action of the appraisers and shall be terminated by the presiding judge as to the demandant upon the filing of the findings of the appraisers with the consolidating cooperative.

    (3) If the articles of merger or consolidation are adopted by the affirmative vote of not less than two-thirds of the members attending and voting of each consolidating cooperative voting thereon at the meeting called to consider the same, or by not less than by a two-thirds vote of its delegates if qualified as provided in subdivision (4) of this section, articles of merger or consolidation in the form adopted shall be executed under its seal and acknowledged on behalf of each consolidating cooperative by its president or vice-president. Such articles of merger or consolidation shall recite that they are executed pursuant to this subchapter and shall state:

    (A) the name of each consolidating cooperative and the address of its principal office;

    (B) the name of the new cooperative and the address of its principal office;

    (C) a statement that each consolidating cooperative agrees to the merger or consolidation;

    (D) the names and addresses of the directors of the new cooperative; and

    (E) the terms and conditions of the merger or consolidation and the mode of carrying the same into effect, including the manner in which the members of the consolidating cooperative may or shall become members of the new cooperative; and may contain provisions, not inconsistent with law or this subchapter, which are deemed necessary or advisable for the conduct of the business of the new cooperative.

    The president or vice president and the clerk or secretary of each consolidating cooperative executing such articles of merger or consolidation shall make and annex thereto an affidavit stating that the provisions of this section in respect to such articles were duly complied with by such cooperative.

    (4) In the case of any consolidating cooperative having a district election of delegates and a delegate system of voting as permitted by subdivision 995(10) of this title, in which, under its articles of association or bylaws, such delegates have complete voting power on behalf of the membership for every purpose, except that of their own election and the election of district directors, the vote adopting the merger or consolidation required by subdivision (3) of this section shall be that of not less than two-thirds of the delegates attending and voting at such meeting. (Amended 1965, No. 89, §§ 1, 2, eff. June 10, 1965; 1973, No. 193 (Adj. Sess.), § 3, eff. April 9, 1974.)

  • § 1062. Filing of articles

    The articles of merger or consolidation, or a duplicate original thereof, or a copy duly certified by the clerk or secretary of the consolidating cooperative or the new cooperative, shall be filed in the Office of the Secretary of State of this State and with the Secretary of Agriculture, Food and Markets, and if the same affects title to real estate in this State, shall be recorded in the office where by law a deed of such real estate is required to be recorded. The making and perfecting of such merger or consolidation shall not be effective until the same is filed in the Office of the Secretary of State as herein provided, and in the case of the new cooperative, if the same is to have capital stock, until it has filed an affidavit of the proposed issue of its stock. (Amended 2003, No. 42, § 2, eff. May 27, 2003.)

  • § 1063. Fee

    For filing articles of merger or consolidation the new cooperative shall pay $20.00 to the Secretary of State; and for filing an amendment thereof $10.00. (Amended 1963, No. 37, § 5; 1967, No. 278 (Adj. Sess.), § 8.)

  • § 1064. Powers

    The new cooperative, in addition to the general powers of cooperative associations granted by subchapter 1 of this chapter, shall possess and enjoy all the rights, privileges, powers, franchises, immunities, exemptions, and benefits of each of the consolidating cooperatives, and may exercise the same in this State, unless contrary to law, as effectually as each of the consolidating cooperatives. The title to any real estate or personal property vested in the consolidating cooperatives, under the laws of this State shall pass to and be vested in the new cooperative upon the recording of the articles of merger or consolidation in the office where by law a deed thereof should be recorded, and shall not revert, or be in any way impaired, by reason of such merger or consolidation.

  • § 1065. Preservation of rights and liabilities

    All rights of creditors and liens upon the property of the consolidating cooperatives shall be preserved unimpaired; and all debts, liabilities, and duties of each consolidating cooperative shall thenceforth become the obligation of the new cooperative and may be enforced against the latter to the same extent as if the obligations and liabilities had been incurred or contracted by it. (Amended 1971, No. 185 (Adj. Sess.), § 28, eff. March 29, 1972.)