As used in this article:
(a) "Agricultural products" mean horticultural, viticultural, forestry, dairy, livestock, poultry, bee and any farm products, in their natural form or processed;
(b) "Member" means a member of an association without capitol stock, and a holder of common stock in an association organized with capital stock;
(c) "Cooperative association" or "association" means any corporation organized under this article. Each association shall also comply with the business corporation provisions of chapter thirty-one-d or the nonprofit corporation provisions of chapter thirty-one-e of this code.
Three or more persons engaged in the production of agricultural products may form a cooperative association with or without capital stock. Three or more cooperative associations may form an agricultural credit association, with or without capital stock, under this article and in compliance with the credit union provisions of chapter thirty-one-c of this code.
(a) To engage in any activity in connection with the marketing, selling, preserving, harvesting, drying, processing, manufacturing, canning, packing, grading, storing, handling or utilization of any agricultural products produced or delivered to it by its members or purchased or received by consignment from other persons, or the manufacturing or marketing of the by- products thereof; or any activity in connection with the purchase, hiring, or use by its members of supplies, machinery, or equipment; or in securing and disseminating market information; or in the financing, directly, through agricultural credit associations, and/or otherwise, any such activities; or in any one or more of the activities specified in this section: Provided, however, That all transactions with nonmembers shall be on terms fixed by the association, and such nonmembers shall not otherwise participate in any benefits derived from such transactions;
(b) To borrow money without limitation as to amount of corporate indebtedness or liability, and to make advance payments and advances to members; to execute, issue, draw, make, accept, endorse, and guarantee, without limitation, promissory notes, bills of exchange, drafts, warrants, certificates, mortgages, and any other form of obligation or negotiable or transferable bills of any kind; to become the surety, guarantor, maker, and/or endorser for accommodation or otherwise of bills, notes, securities, and other evidences of debt of any association or person, anything in any other statutes or law of this state to the contrary notwithstanding;
(c) To act as the agent or representative of any member or members in any of the above-mentioned activities;
(d) To purchase or otherwise acquire, and to hold, own, and exercise all rights of ownership 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 or handling or marketing of any of the products handled by the association;
(e) To establish reserves and to invest the funds thereof in bonds or in such other property as may be provided in the bylaws;
(f) To buy, hold and exercise all privileges of ownership over real or personal property as may be necessary or convenient for the conduct and operation of any of the business of the association, or incidental thereto;
(g) To establish, secure, own and develop patents, trademarks and copyrights;
(h) To do each and every thing necessary, suitable or proper for the accomplishment of any one of the purposes or the attainment of any one or more of the subjects herein enumerated, or conducive to or expedient for the interest or benefit of the association; and to contract accordingly; and, in addition, 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 any other rights, powers, and privileges granted by the laws of this state to ordinary corporations, except such as are inconsistent with the purposes of this article; and to do any such thing anywhere. An agricultural credit association shall have all of the powers given to a cooperative association under the provisions of subdivision (b) of section four of this article, and in general shall have power to do and perform any act or thing, not inconsistent with law, which may be appropriate to promote and attain the objects and purposes of such credit association.
If a member of a nonstock association be other than a natural person, such member may be represented by an individual, associate, officer or manager or member thereof, duly authorized in writing.
One association organized hereunder may become a member or stockholder of any other association or associations organized under this article or similar laws of any state.
Each association formed under this article shall prepare and file articles of incorporation, setting forth:
(a) The name of the association, which includes the words "cooperative," "co-operative," or "co-op," and words or abbreviations designating a corporation;
(b) The purposes for which it is formed;
(c) The place where its principal business will be transacted;
(d) The period, if any prescribed, for the duration of the corporation;
(e) The number of incorporators which is not less than three, the number of directors which is not less than three and any number in excess of those minimums, or it may be set forth that the number of directors will be fixed by the bylaws;
(f) If organized without capital stock, whether the property rights and interest of each member are equal or unequal; and if unequal, the general rules applicable to the classes of members whose property rights and interest are determined and fixed; and provision for the admission of new members who may be entitled to share in the property of the association with the old members, in accordance with the general rules. This provision of the articles of incorporation may not be altered, amended or repealed except by the written consent or vote of three fourths of the members;
(g) If organized with capital stock and authorized to issue only one class of stock, the total number of shares of stock which the association has authority to issue, including: (1) The par value of each of the shares; or (2) a statement that all the shares are to be without par value;
(h) If the association is authorized to issue more than one class of stock, the total number of shares of all classes of stock which the association may issue, including: (1) The number of shares of each class that have a par value and the par value of each share by class; (2) the number of shares that are to be without par value; and (3) a statement of the powers, preferences, rights, qualifications, limitations or restrictions that are permitted by section thirteen of this article in respect to a class of stock fixed by the articles of incorporation or by resolution of the board of directors;
(i) The articles shall be signed and filed in accordance with the provisions of the business or nonprofit corporation laws of this state;
(a) The time, place and manner of calling and conducting its meetings;
(b) The number of stockholders or members constituting a quorum;
(c) The right of members or stockholders to vote by proxy or by mail or both; and the conditions, manner, form, and effect of such votes;
(d) The number of directors constituting a quorum; and, if authority therefor is given in the articles of incorporation, the total number of directors;
(e) The qualifications, compensation, duties and term of office of directors and officers; time of their election and the mode and manner of giving notice thereof;
(f) Penalties for violation of the bylaws;
(g) The amount of entrance, organization and membership fees, if any; the manner and method of collecting the same; and the purposes for which they may be used;
(h) 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 charge, if any, to be paid by each member or stockholder for services rendered by the association to him and the time of payment and the 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;
(i) The number and qualifications 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 membership of any member shall cease; the automatic suspension of the rights of a member when he ceases to be eligible to membership in the association; the mode, 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, at its option, upon the death or withdrawal of a member or stockholder, or upon the expulsion of a member or forfeiture of his membership, or, at the option of the association, the purchase at a price fixed by conclusive appraisal by the board of directors, or at the election of the board, such property interests may be sold at public auction to the association itself, or to any person eligible to membership in such association and the proceeds of such sale paid over to the personal representative of such deceased member, or to the member withdrawing or expelled, as the case may be.
(a) The affairs of the association shall be managed by a board of not less than three directors, elected by the members or stockholders.
(b) The bylaws may provide that the territory in which the association has members shall be divided into districts and that the directors be elected either directly or by district delegates elected by the members in that district. The bylaws shall specify the number of directors to be elected by each district, the manner of reapportioning the directors and the method of redistricting the territory covered by the association. The bylaws may provide that primary elections shall be held in each district to elect the directors apportioned to the districts and that the results of all the primary elections may be ratified during the next regular meeting of the association or may be considered final.
(c) The bylaws may provide that one or more directors may be appointed by a public official, commission or by the other directors. These public directors shall represent the interest of the general public in the associations. The public directors need not be members or stockholders of the association, but shall have the same powers and rights as other directors. The directors shall not number more than one fifth of the entire number of directors.
(d) An association may provide a fair remuneration for the time actually spent by its officers and directors in its service and for the service of the members of its executive committee. No director, during the term of his or her office, shall be a party to a contract for profit with the association differing from the contractual terms accorded regular members or holders of common stock of the association.
(e) The bylaws may provide that no director, except the president and secretary, shall occupy a position in the association on regular salary or substantially full-time pay.
(f) The bylaws may provide for an executive committee and may allot to the committee all the functions and powers of the board of directors, subject to the general direction and control of the board.
(g) When a vacancy on the board of directors occurs other than by expiration of term, the remaining members of the board, by a majority vote, shall fill the vacancy, unless the bylaws provide for an election of directors by district. In that case the board of directors shall immediately call a special meeting of the members or stockholders in that district to fill the vacancy.
No association shall 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.
No member shall be liable for the debts of the association to an amount exceeding the sum remaining unpaid on his membership fee or his subscription to the capital stock, including any unpaid balance on any promissory notes given in payment thereof.
An association in its bylaws, may limit the amount of common stock which one member may own. No member or stockholder shall be entitled to more than one vote, regardless of the number of shares of common stock owned by him.
Any association organized with stock under this article may issue preferred stock, with or without the right to vote. Such stock may be sold to any person, member or nonmember, and may be redeemable or retireable by the association on such terms and conditions as may be provided for by the articles of incorporation and printed on the face of the certificate. The bylaws shall prohibit the transfer of the common stock of the association to persons, or organizations, not engaged in the production or cooperative marketing of the agricultural products handled by the association, and/or members of credit associations financing such products; and such restrictions shall be printed upon every certificate of stock subject thereto.
Other kinds and classes of stock may be issued in compliance with the provisions of the articles of incorporation, the terms of the bylaws, or special resolutions of the board of directors.
The association may, at any time, as specified in the bylaws, except when the debts of the association exceed fifty percent of the assets thereof, buy in or purchase its common stock at the book value thereof, as conclusively determined by the board of directors, and pay for it in cash within one year thereafter.
In case the bylaws provide for election of directors by districts with primary elections in each district, then the petition for removal of a director must be signed by twenty percent of the members residing in the district from which he was elected. The board of directors must call a special meeting of the members residing in that district to consider the removal of the director; and by a vote of the majority of the members of that district the director in question shall be removed from office.
In the event of any such breach or threatened breach of such marketing contract by a member, the association shall be entitled to an injunction to prevent the further breach of the contract and to a decree of specific performance thereof. Pending the adjudication of such an action and upon filing a verified complaint showing the breach or threatened breach, and upon filing a sufficient bond, the association may be entitled to a temporary restraining order and preliminary injunction against the member.
In any action upon such marketing agreement, it shall be presumed as between the parties that the landowner, landlord or lessor claiming therein so to be is able to control the delivery of products produced on his land by tenants or others, whose tenancy or possession or work on such land or the terms of whose tenancy or possession or labor thereon were created or changed after execution by the landowner, landlord or lessor of such marketing agreement; and in such actions the foregoing remedies for nondelivery or breach shall lie and be enforceable against such landowner, landlord or lessor.
Each association formed under this article shall prepare an annual report on forms provided by and filed with the Secretary of State pursuant to the requirements of section two-a, article one, chapter fifty-nine of this code.
Any exemptions whatsoever under any and all existing laws applying to agricultural products in the possession or under the control of the individual producer shall apply similarly and completely to such products delivered by its former members, in the possession or under the control of the association.
(a) A cooperative association formed pursuant to this article shall include the words "cooperative", "co-operative" or "co-op" in the name, and the words or abbreviations designating a corporation.
(b) A farmers' marketing association for the sale of farm products is prohibited from using the terms identified in subsection (a) of this section as part of its corporate or other business name or title, unless it has complied with this article.
If such corporations are warehousing corporations, they may issue legal warehouse receipts to the association against the commodities delivered by it, or to any other person, and such legal 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 or the United States, its warehouse receipt delivered to the association on commodities of the association or its members, or delivered by the association or its members, shall not be challenged or discriminated against because of ownership or control, wholly or in part, by the association.
Where any association may be incorporated under this article, all contracts made prior to April eighteenth, nineteen hundred and twenty-three, by or on behalf of such association by the promoters thereof in anticipation of its becoming incorporated under the laws of this state, whether or not such contracts be made by or in the name of some corporation organized elsewhere, and when they would have been valid if entered into subsequent to such date, shall be held valid as if made after such date.
The provisions of the business corporation laws in chapter thirty-one-d or the nonprofit corporation laws in chapter thirty-one-e of this code and all powers and rights thereunder shall apply to the associations organized under this article and may be used by them, except when the provisions are in conflict with or inconsistent with the express provisions of this article.
Acts, 2013 Reg. Sess., Ch. 1.
Note: WV Code updated with legislation passed through the 2014 1st Special Session
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