As Re-reported by the House Agriculture and Natural 1
Resources Committee 2
122nd General Assembly 5
Regular Session Am. H. B. No. 600 6
1997-1998 7
REPRESENTATIVES HOUSEHOLDER-CAREY-GRENDELL-REID-OGG-BUCHY- 9
GARCIA-GARDNER-PADGETT-HAINES-LOGAN-TERWILLEGER-HARRIS- 10
METZGER-VESPER-WESTON-ROMAN-WILLAMOWSKI-OPFER-SULZER-WILSON 11
13
A B I L L
To amend sections 917.01, 917.16, 1707.02, 1729.02, 15
1729.03, 1729.05, 1729.07, 1729.15, 1729.16, 16
1729.22, 1729.23, 1729.25, 1729.99, and 4517.22; 17
to amend, for the purpose of adopting new 18
section numbers as indicated in parentheses, 19
sections 1729.05 (1729.06), 1729.07 (1729.08), 21
1729.15 (1729.27), 1729.16 (1729.28), 1729.22 22
(1729.80), 1729.23 (1729.84), and 1729.25 23
(1729.76); to enact new sections 1729.01, 25
1729.04, 1729.07, 1729.09, 1729.10, 1729.11, 27
1729.12, 1729.13, 1729.14, 1729.16, 1729.17, 28
1729.18, 1729.19, 1729.20, 1729.22, 1729.23, 29
1729.24, 1729.25, 1729.26, 1729.35, 1729.36, and 31
1729.37 and sections 1729.29, 1729.38, 1729.40, 32
1729.42, 1729.44, 1729.46, 1729.47, 1729.49, 33
1729.55, 1729.56, 1729.58, 1729.59, 1729.60, 35
1729.61, 1729.67, 1729.68, 1729.69, 1729.70, 37
1729.85, and 1729.86; and to repeal sections 38
1729.01, 1729.04, 1729.06, 1729.08, 1729.09, 39
1729.10, 1729.11, 1729.12, 1729.13, 1729.14, 42
1729.17, 1729.18, 1729.181, 1729.19, 1729.191, 43
1729.192, 1729.20, 1729.21, 1729.24, 1729.26, 45
1729.27, 1729.28, 1729.30, 1729.31, 1729.32, 46
1729.33, 1729.34, 1729.35, 1729.36, and 1729.37 48
of the Revised Code to establish the "Ohio 49
2
Cooperative Law" by revising the agricultural 51
cooperative law, by repealing the law governing 52
consumers' and worker-owned cooperatives, and by 54
enacting provisions for mergers, consolidations, 55
divisions, and dissolutions of cooperatives, and 56
to permit livestock trailers to be displayed and 57
sold at livestock and agricultural shows. 58
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO: 60
Section 1. That sections 917.01, 917.16, 1707.02, 1729.02, 62
1729.03, 1729.05, 1729.07, 1729.15, 1729.16, 1729.22, 1729.23, 63
1729.25, 1729.99, and 4517.22 be amended; sections 1729.05 64
(1729.06), 1729.07 (1729.08), 1729.15 (1729.27), 1729.16 65
(1729.28), 1729.22 (1729.80), 1729.23 (1729.84), and 1729.25 66
(1729.76) be amended for the purpose of adopting new section 67
numbers as indicated in parentheses; and new sections 1729.01, 68
1729.04, 1729.07, 1729.09, 1729.10, 1729.11, 1729.12, 1729.13, 69
1729.14, 1729.16, 1729.17, 1729.18, 1729.19, 1729.20, 1729.22, 70
1729.23, 1729.24, 1729.25, 1729.26, 1729.35, 1729.36, and 1729.37 71
and sections 1729.29, 1729.38, 1729.40, 1729.42, 1729.44, 72
1729.46, 1729.47, 1729.49, 1729.55, 1729.56, 1729.58, 1729.59, 73
1729.60, 1729.61, 1729.67, 1729.68, 1729.69, 1729.70, 1729.85, 74
and 1729.86 of the Revised Code be enacted to read as follows: 75
Sec. 917.01. As used in this chapter: 84
(A) "Person" means any individual, government agency, 86
political subdivision, partnership, corporation, affiliate or 88
subsidiary of a corporation, association, co-operative 89
association, or other business unit. 90
(B) "Co-operative association" OR "AGRICULTURAL 92
COOPERATIVE ASSOCIATION" means any association AGRICULTURAL 94
COOPERATIVE organized under sections 1729.01 to 1729.27 CHAPTER 95
1729. of the Revised Code, or under the "Co-operative Marketing 98
Associations (Capper-Volstead) Act," 7 U.S.C. 291, 292 (1980), as 100
amended, and qualified to do business in Ohio, if the director of 101
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agriculture finds the association has, in good faith, its entire 102
activities under the control of its members and has been and is 103
exercising full authority in the sale of milk or cream for its
members. 104
(C) "Market area" means any area that the director finds 107
is a natural marketing area and designates as such. 109
(D) "Dealer" or "milk dealer" means a person who purchases 112
or receives milk from a producer for the purpose of bottling, 115
packaging, selling, processing, jobbing, brokering, or 116
distributing the milk except where the milk is disposed of in the 118
same container in which it is received, without removal from the 120
container and without processing in any way except by necessary 122
refrigeration. Any person who buys and distributes milk in 123
containers under the person's own label is a dealer.
(E) "Imitation" means imitation as described in 21 C.F.R. 127
101.3, as amended. 128
(F) "Milk" means the lacteal secretion, substantially free 131
from colostrum, obtained by the complete milking of one or more 132
healthy cows, goats, sheep, or other animals and intended for 133
either of the following purposes: 134
(1) To be sold for human consumption or for use in dairy 137
products;
(2) To be used for human consumption or for use in dairy 140
products on the premises of a governmental agency or institution. 141
"Milk" does not include a blend of the lacteal secretions 143
of different species. 144
(G) "Grade A milk" means milk produced by a person holding 147
a valid producer license of the grade A milk category issued
pursuant to section 917.09 of the Revised Code. 150
(H) "Manufacture milk" means milk produced by a person 153
holding a valid producer license of the manufacture milk category 154
issued pursuant to section 917.09 of the Revised Code. 156
(I) "Producer" or "milk producer" means a grade A milk 159
producer or a manufacture milk producer. 160
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(J) "Grade A milk producer" means a person located in this 163
state who sells or offers for sale grade A milk obtained from a
cow, goat, sheep, or other animal that the person owns or 164
controls. 165
(K) "Manufacture milk producer" means a person located in 168
this state who sells or offers for sale manufacture milk obtained 169
from a cow, goat, sheep, or other animal that the person owns or 170
controls.
(L) "Grade A milk products" means products derived from 173
grade A milk and having the standard of identity, quality, 174
strength, purity, grade, and, if added, permitted optional 175
ingredients found in the standards of identity established for 176
the products in rules adopted by the director under section 177
917.02 or 3715.02 of the Revised Code, and includes: 179
(1) Cottage cheese; 181
(2) Raw, pasteurized, or aseptically processed products 184
derived from milk and described in either of the following:
(a) The most recent published recommendations of the food 187
and drug administration, public health service, United States 189
department of health and human services; 190
(b) Rules adopted by the director. 193
(M) "Manufactured milk products" means all products, other 196
than raw milk for sale to the ultimate consumer and grade A milk 197
products, that are derived from milk and are for human 198
consumption, including:
(1) Butter; 200
(2) Natural or processed cheese; 202
(3) Evaporated, condensed, and dry products; 204
(4) Frozen desserts; 206
(5) Such other products derived from milk as the director 208
may specify by rule that have the standard of identity, quality, 209
strength, purity, grade, and, if added, permitted optional 210
ingredients found in the standards of identity established for 211
the product in rules adopted by the director under section 917.02 212
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or 3715.02 of the Revised Code. 214
(N) "Dairy products" means milk, raw milk for sale to the 217
ultimate consumer, grade A milk products, and manufactured milk 218
products.
(O) "Frozen desserts" means frozen desserts, including the 221
mixes, described in 21 C.F.R. 135, as amended, unless otherwise 223
specified by the director by rule. 224
(P) "Milk plant" means a grade A milk plant or manufacture 228
milk plant.
(Q) "Grade A milk plant" means a place, including a 231
governmental operation, where grade A milk or a grade A milk
product is collected, handled, controlled, processed, stored, 232
pasteurized, ultra-pasteurized, repasteurized, aseptically 233
processed, bottled, or prepared for distribution, but does not 234
include a place where a grade A milk product is purchased in 235
packaged form and is stored and handled for the sole purpose of 236
sale to the ultimate consumer.
(R) "Manufacture milk plant" means a place, including a 239
governmental operation, where manufacture milk or a manufactured 240
milk product is collected, handled, controlled, manufactured, 241
processed, stored, pasteurized, ultra-pasteurized, repasteurized, 242
commercially sterilized, aseptically processed, bottled, or 243
prepared for distribution, but does not include a place where a 244
manufactured milk product is purchased in packaged form and is 245
stored and handled for the sole purpose of sale to the ultimate 246
consumer. 247
(S) "Raw milk for sale to the ultimate consumer" means the 250
raw milk sold or offered for sale by a raw milk retailer. 251
(T) "Raw milk retailer" means a person who, prior to 254
October 31, 1965, was engaged continuously in the business of 256
selling or offering for sale raw milk directly to ultimate 257
consumers.
(U) "Processor" or "milk processor" means a grade A milk 260
processor or a manufacture milk processor. 261
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(V) "Grade A milk processor" means a person who operates 265
or controls a milk plant that is located in this state or from 266
which grade A milk or grade A milk products are sold or offered 269
for sale for human consumption.
(W) "Manufacture milk processor" means any person who 271
operates or controls a manufacture milk plant that is located in 272
this state or from which manufacture milk or manufactured milk 273
products are sold or offered for sale for human consumption. 274
(X) "Weigher, sampler, or tester" means a person who, in 277
order to determine volume, weight, or composition for the purpose 278
of determining price, weighs, tests, or samples either of the 279
following:
(1) Milk at a dairy farm; 281
(2) Milk or cream purchased by a dealer from a milk 283
producer or co-operative association. 284
(Y) "Hauler" or "milk hauler" means a person who owns or 287
leases a vehicle or conveyance used to transport raw milk, but 288
does not include a producer transporting raw milk that the 289
producer has produced. 290
(Z) "License" means a license issued under section 917.09 293
of the Revised Code and includes a registration issued under 295
division (I) of that section. 296
Sec. 917.16. (A) This chapter shall not restrain, limit, 306
prejudice, abrogate, or take from any co-operative association 308
AGRICULTURAL COOPERATIVE ASSOCIATION the powers, privileges, and 309
rights it has under sections 1729.01 to 1729.27 CHAPTER 1729. of 311
the Revised Code.
(B) Specifically, but without limiting division (A) of 313
this section, this chapter shall not derogate from or prejudice 316
any rights of any co-operative association, provided that the 317
association and its employees comply with the licensing 318
requirements.
Sec. 1707.02. (A) "Exempt," as used in this section, 328
means exempt from sections 1707.08 to 1707.11 and 1707.39 of the 329
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Revised Code. 330
(B)(1) Except as provided in division (B)(2) of this 332
section, the following securities are exempt, if the issuer or 333
guarantor has the power of taxation or assessment for the purpose 334
of paying the obligation represented by the security, or is in 335
specific terms empowered by the laws of the state of issuance to 336
issue securities payable as to principal or interest, or as to 337
both, out of revenues collected or administered by such issuer: 338
(a) Any security issued or guaranteed by the United 340
States; 341
(b) Any security issued or guaranteed by, and recognized, 343
at the time of sale, as its valid obligation by, any foreign 344
government with which the United States is, at the time of sale, 345
maintaining diplomatic relations; 346
(c) Any security issued or guaranteed, and recognized as 348
its valid obligation, by any political subdivision or any 349
governmental or other public body, corporation, or agency in or 350
of the United States, any state, territory, or possession of the 351
United States, or any foreign government with which the United 352
States is, at the time of sale, maintaining diplomatic relations. 353
(2) If a security described in division (B)(1) of this 355
section is not payable out of the proceeds of a general tax, the 357
security is exempt only if, at the time of its first sale in this
state, there is no default in the payment of any of the interest 359
or principal of the security, and there are no adjudications or 360
pending suits adversely affecting its validity. 361
(C) Any security issued by and representing an interest in 363
or an obligation of a state or nationally chartered bank, savings 364
and loan association, savings bank, or credit union, or a 366
governmental corporation or agency created by or under the laws 367
of the United States or of Canada is exempt, if it is under the 368
supervision of or subject to regulation by the government or 369
state under whose laws it was organized.
(D) Any interim certificate is exempt, if the securities 371
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to be delivered therefor are themselves exempt, are the subject 372
matter of an exempt transaction, have been registered by 373
description or registered by qualification, or are the subject 374
matter of a transaction which has been registered by description. 375
(E)(1) Any security, whether a preliminary or final 377
security, is exempt, which, at the time of sale within this 378
state, is listed, or listed upon notice of issuance, on the 379
Cincinnati stock exchange, the Midwest stock exchange, the New 380
York stock exchange, or the American stock exchange, or is 381
designated, or approved for designation upon notice of issuance, 382
as a national market system security on the national association 383
of securities dealers automated quotation system, or is listed or 384
designated on any other stock exchange or national quotation 385
system approved by the division as having listing requirements 386
substantially equivalent to those of any one of those exchanges 387
or systems, and any security senior to any security so listed or 388
designated is also exempt; but these exemptions shall apply only 389
so long as such security remains so listed or designated pursuant 390
to official action of such exchange or system and not under 391
suspension, and only so long as such exchange or system remains 392
approved under this section. 393
(2) Application for approval of a stock exchange or system 395
not approved in this section may be made by any organized stock 396
exchange or system, or by any dealer who is a member of such 397
exchange, in such manner and upon such forms as are prescribed by 398
the division, accompanied by payment of an approval fee of two 399
hundred dollars, and the division shall make such investigation 400
and may hold such hearings as it deems necessary to determine the 401
propriety of giving approval. The cost of such investigation 402
shall be borne by the applicant. The division may enter an order 403
of approval, and if it does so, it shall notify the applicant of 404
such approval. 405
(3) The division may revoke the approval of an exchange or 407
system approved in this section or approved by it upon finding, 408
9
after due notice, investigation, and hearing, that the practices 409
or requirements of such exchange or system have been so changed 410
or modified, or are, in their actual operation, such that the 411
contemplated protection is no longer afforded. The principles of 412
res adjudicata ordinarily applicable in civil matters shall not 413
be applicable to this matter, which is hereby declared to be 414
administrative rather than judicial. Notice of the hearing may 415
be given by certified mail at least ten days before such hearing. 416
(4) The division may suspend the exemption of any security 418
described in division (E) of this section by giving notice, by 419
certified mail, to that effect to the exchange or system upon 420
which such security is listed or designated and to the issuer of 421
such security. After notice and hearing, the division may revoke 422
such exemption if it appears to it that sales of such security 423
have been fraudulent or that future sales of it would be 424
fraudulent. The division shall set such hearing not later than 425
ten days from the date of the order of suspension, but may for 426
good cause continue such hearing upon application of the exchange 427
or system upon which such security is listed or designated or 428
upon application of the issuer of such security. 429
(F) Any security, issued or guaranteed as to principal, 431
interest, or dividend or distribution by a corporation owning or 432
operating any public utility, is exempt, if such corporation is, 433
as to its rates and charges or as to the issuance and 434
guaranteeing of securities, under the supervision of or regulated 435
by a public commission, board, or officer of the United States, 436
or of Canada, or of any state, province, or municipal corporation 437
in either of such countries. Equipment-trust securities based on 438
chattel mortgages, leases, or agreements for conditional sale, of 439
cars, locomotives, motor trucks, or other rolling stock or of 440
motor vehicles mortgaged, leased, or sold to, or finished for the 441
use of, a public utility, are exempt; and so are equipment 442
securities where the ownership or title of such equipment is 443
pledged or retained, in accordance with the laws of the United 444
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States or of any state, or of Canada or any province thereof, to 445
secure the payment of such securities. 446
(G) Commercial paper and promissory notes are exempt when 448
they are not offered directly or indirectly for sale to the 449
public. 450
(H) Any security issued or guaranteed by an insurance 452
company, except as provided in section 1707.32 of the Revised 453
Code, is exempt if such company is under the supervision of, and 454
the issuance or guaranty of such security is regulated by, a 455
state. 456
(I) Any security, except notes, bonds, debentures, or 458
other evidences of indebtedness or of promises or agreements to 459
pay money, which is issued by a person, corporation, or 460
association organized not for profit, including persons, 461
corporations, and associations organized exclusively for 462
conducting county fairs, for cooperative marketing, or for 465
religious, educational, social, recreational, athletic, 466
benevolent, fraternal, charitable, or reformatory purposes, AND 467
AGRICULTURAL COOPERATIVES AS DEFINED IN SECTION 1729.01 of the 468
Revised Code, is exempt, if no part of the net earnings of such 469
issuer inures to the benefit of any shareholder or member of such 470
issuer or of any individual, and if the total commission, 471
remuneration, expense, or discount in connection with the sale of 472
such securities does not exceed two per cent of the total sale 473
price thereof plus five hundred dollars. 474
(J)(1) Any securities outstanding for a period of not less 476
than five years, on which there has occurred no default in 477
payment of principal, interest, or dividend or distribution for 478
the five years immediately preceding the sale, are exempt. 479
(2) For the purpose of division (J) of this section, the 481
dividend, distribution, or interest rate on securities in which 482
no such rate is specified shall be at the rate of at least four 483
per cent annually on the aggregate of the price at which such 484
securities are to be sold. 485
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(K) All bonds issued under authority of Chapter 165. or 487
761., or section 4582.06 or 4582.31 of the Revised Code are 488
exempt. 489
Sec. 1729.01. AS USED IN THIS CHAPTER: 491
(A) "AGRICULTURAL COOPERATIVE" MEANS A COOPERATIVE TO 493
WHICH ALL OF THE FOLLOWING APPLY: 494
(1) THE COOPERATIVE ENGAGES IN ANY ACTIVITY IN CONNECTION 496
WITH THE PROPAGATION, RAISING, PRODUCING, HARVESTING, STORING, 497
DRYING, HANDLING, PROCESSING, OR MARKETING OF AGRICULTURAL 499
PRODUCTS; PROCURING EQUIPMENT AND SUPPLIES OR PROVIDING SERVICES
FOR PRODUCERS AND OTHERS; BARGAINING; AND ANY ACTIVITY RELATED TO 500
THE FOREGOING. 501
(2) PRODUCERS OR AGRICULTURAL COOPERATIVES EXERCISE MORE 503
THAN FIFTY PER CENT OF THE VOTING CONTROL OF THE COOPERATIVE. 504
(3) THE COOPERATIVE DOES AT LEAST FIFTY PER CENT OF ITS 506
BUSINESS WITH PRODUCERS OR AGRICULTURAL COOPERATIVES. 507
(B) "AGRICULTURAL PRODUCTS" INCLUDES AQUACULTURAL, 509
HORTICULTURAL, VITICULTURAL, FORESTRY, DAIRY, LIVESTOCK, POULTRY, 511
BEE, AND FARM PRODUCTS, AND THE PRODUCE OR BYPRODUCTS OF ANY OF 513
SUCH PRODUCTS.
(C) "ASSOCIATION" MEANS ANY CORPORATION ORGANIZED UNDER 515
THIS CHAPTER. 516
(D) "BARGAINING" MEANS THE MUTUAL OBLIGATION OF A HANDLER 518
AND A MARKETING COOPERATIVE TO MEET AT REASONABLE TIMES AND 519
CONFER AND NEGOTIATE IN GOOD FAITH. NEGOTIATIONS MAY INCLUDE ALL 520
TERMS RELATIVE TO TRADING BETWEEN HANDLERS AND PRODUCERS. THE 521
OBLIGATION DOES NOT REQUIRE EITHER PARTY TO AGREE UPON PRICE, 522
TERMS OF SALE, OR ANY OTHER MARKETING AGREEMENT, OR TO MAKE A
CONCESSION. 523
(E) "BOARD" MEANS THE BOARD OF DIRECTORS OF AN 525
ASSOCIATION. 526
(F) "COOPERATIVE" MEANS AN ASSOCIATION OR A FOREIGN 528
ASSOCIATION.
(G) "CORPORATION" MEANS ANY CORPORATION, DOMESTIC OR 530
12
FOREIGN, THAT IS NOT A COOPERATIVE. 531
(H) "ENTITY," EXCEPT AS OTHERWISE PROVIDED, MEANS A FOREIGN 534
ASSOCIATION, A CORPORATION, OR A FOREIGN OR DOMESTIC LIMITED 535
LIABILITY COMPANY.
(I) "FOREIGN ASSOCIATION" MEANS A CORPORATION ORGANIZED 537
UNDER THE COOPERATIVE LAWS OF ANOTHER STATE OR THE DISTRICT OF 539
COLUMBIA OR A CORPORATION ORGANIZED UNDER THE LAW OF ANOTHER
STATE OR THE DISTRICT OF COLUMBIA AND OPERATING ON A COOPERATIVE 540
BASIS. 541
(J) "HANDLER" MEANS A PERSON WHO ACQUIRES AGRICULTURAL 543
PRODUCTS UNDER A SALES CONTRACT FOR THE PURPOSE OF PROCESSING OR 544
RESELLING THE AGRICULTURAL PRODUCTS. 545
(K) "MARKETING AGREEMENT" MEANS AN AGREEMENT, CONTRACT, OR 547
OTHER ARRANGEMENT BETWEEN A COOPERATIVE AND A MEMBER IN WHICH THE 548
MEMBER AGREES TO MARKET ALL OR A PART OF THE PRODUCTS OR PRODUCE 549
PRODUCED BY THE MEMBER, OR AGREES TO PURCHASE ALL OR A PART OF 550
THE MEMBER'S REQUIREMENTS FOR INPUTS, SERVICES, OR SUPPLIES. 551
(L) "MARKETING COOPERATIVE" MEANS ANY AGRICULTURAL 553
COOPERATIVE MEETING THE REQUIREMENTS OF THE "CO-OPERATIVE 554
MARKETING ASSOCIATIONS ACT," 42 STAT. 388 (1922), 7 U.S.C.A. 291, 556
THAT NEGOTIATES SALES CONTRACTS WITH HANDLERS ON BEHALF OF ITS
MEMBERS AND IS NOT IN DIRECT COMPETITION WITH ANY HANDLER WITH 557
WHICH IT NEGOTIATES SUCH CONTRACTS. 558
(M) "MEMBER" MEANS A PERSON WHO HAS BEEN QUALIFIED AND 560
ACCEPTED INTO MEMBERSHIP IN AN ASSOCIATION. 561
(N) "MEMBERSHIP STOCK" MEANS ANY CLASS OF STOCK OR OTHER 563
EQUITY INTEREST IN AN ASSOCIATION, CONTINUOUS OWNERSHIP OF WHICH 564
IS REQUIRED FOR MEMBERSHIP IN AN ASSOCIATION. 565
(O) "PATRONAGE STOCK" MEANS ANY STOCK OR OTHER EQUITY 567
INTEREST IN AN ASSOCIATION THAT WAS ORIGINALLY ISSUED BY THE 568
ASSOCIATION WITH RESPECT TO PATRONAGE TRANSACTIONS. 569
(P) "PERSON" INCLUDES A NATURAL PERSON, PARTNERSHIP, 571
CORPORATION, COOPERATIVE, OR OTHER ENTITY. 572
(Q) "PROCESSING" MEANS CHANGING THE PHYSICAL OR CHEMICAL 574
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CHARACTERISTICS OF AGRICULTURAL PRODUCTS. 575
(R) "PRODUCER" MEANS A PERSON ENGAGED IN THE PRODUCTION OF 578
AGRICULTURAL PRODUCTS FOR THE MARKET, INCLUDING A LESSOR OF LAND
WHO RECEIVES AS RENT PART OF THE AGRICULTURAL PRODUCT OF SUCH 579
LAND.
(S) "SALES CONTRACT" MEANS A MARKETING AGREEMENT OR OTHER 581
SIMILAR ARRANGEMENT BETWEEN A HANDLER AND A PRODUCER, NEGOTIATED 583
BY THE PRODUCER OR BY AN AGRICULTURAL COOPERATIVE ACTING AS AGENT 584
FOR A PRODUCER, UNDER WHICH THE PRODUCER AGREES TO GROW OR
PRODUCE AGRICULTURAL PRODUCTS FOR SALE TO THE HANDLER. 585
Sec. 1729.02. (A) An association may be organized to 594
engage in any activity in connection with the marketing or 596
selling of the agricultural products of its members, with the 597
harvesting, preserving, drying, processing, canning, packing, 598
grading, storing, handling, shipping, or utilization of such
products, or with the manufacturing or marketing of the 599
by-products of such products; to engage in any activity in 600
connection with the manufacturing, selling, or supplying to its 601
members of machinery, equipment, or supplies of any kind; to 602
engage in services in connection with activities authorized by
sections 1729.01 to 1729.27, inclusive, of the Revised Code; or 603
to engage in the financing of the activities enumerated in this 604
section. Such association may be organized to engage in any one 605
or more of such activities, but this UNDER THIS CHAPTER FOR ANY 606
LAWFUL PURPOSE PERMITTED TO CORPORATIONS BY THE LAWS OF THIS 607
STATE, EXCEPT ANY SUCH PURPOSE THAT IS INCONSISTENT WITH THE 608
PROVISIONS OF THIS CHAPTER OR OTHER CHAPTERS OF TITLE XVII OF THE 610
REVISED CODE. THIS section does not authorize any professional 611
services otherwise prohibited by law. 612
(B) ASSOCIATIONS SHALL BE DEEMED NONPROFIT BECAUSE THEY 614
ARE NOT ORGANIZED FOR THE PURPOSE OF MAKING A PROFIT FOR 615
THEMSELVES AS SUCH, OR FOR THE PURPOSE OF MAKING A PROFIT FOR 616
THEIR MEMBERS AS SUCH, BUT FOR THEIR MEMBERS AS PATRONS. 617
(C) THIS CHAPTER SHALL BE KNOWN AS THE "OHIO COOPERATIVE 620
14
LAW."
Sec. 1729.03. Each association incorporated under sections 629
1729.01 to 1729.27, inclusive, of the Revised Code THIS CHAPTER 630
shall have the following powers: 631
(A) It may engage in any activity in connection with the 633
marketing, selling, preserving, harvesting, drying, processing, 635
manufacturing, canning, packing, grading, storing, handling, or 636
utilization of any agricultural products produced or delivered to 637
it by its members or others, or with the manufacturing or 638
marketing of the by-products of such products; any activities in 639
connection with the purchase, sale, hiring, or use, by its
members or others, of supplies, machinery, or equipment of any 640
kind; may engage in services in connection with any activities 641
authorized by sections 1729.01 to 1729.27, inclusive, of the 642
Revised Code, or may engage in the financing of such activities. 643
Such association may engage in any one or more of the activities 644
specified in this section but this section does not authorize any
professional services otherwise prohibited by law. 645
Any such association may limit its activities to the 647
handling or the marketing of products of its own members, except 649
for storage. If it handles the products of nonmembers, the total 650
of such nonmembers' products handled by it in any fiscal year 651
must not exceed the total of similar products handled by the 652
association for its own members during the same period.
(B) It may borrow money without limitation as to amount of 654
corporate indebtedness or liability except in the case of 655
associations organized with capital stock, and may make advance 656
payments and other advances to members or others. 657
(C) It may act as the agent or representative of any 659
members in any of the activities mentioned in divisions (A) and 660
(B) of this section.
(D) It may purchase, otherwise acquire, hold, own, 662
exercise all rights of ownership in, sell, transfer, pledge, 663
guarantee the payment of dividends or interest on, or guarantee 664
15
the retirement or redemption of shares of capital stock or bonds 665
of any corporation or association engaged in any activity
directly related to the association's own authorized activities 666
or in the warehousing, handling, or marketing of any of the 667
products handled by the association. 668
(E) It may establish reserves and invest the funds thereof 670
in bonds or in such other property as is provided in the bylaws 671
MAKE CONTRACTS, INCUR LIABILITIES, AND BORROW MONEY; ISSUE 672
CAPITAL STOCK AND CERTIFICATES REPRESENTING EQUITY INTERESTS OR 674
INDEBTEDNESS; ACQUIRE PROPERTY; AND DISPOSE OF, MORTGAGE, PLEDGE, 675
LEASE, OR OTHERWISE USE IN ANY MANNER, ANY OF ITS PROPERTY, OR 676
ANY INTEREST IN ITS PROPERTY, WHEREVER SITUATED.
(B) IT MAY INVEST ITS FUNDS, LEND MONEY FOR ITS PURPOSES, 678
AND HOLD ANY PROPERTY AS SECURITY FOR REPAYMENT. 679
(C) IT MAY ACT AS THE AGENT OR REPRESENTATIVE OF ANY 681
MEMBERS IN ANY ACTIVITIES AUTHORIZED BY THIS CHAPTER. 682
(D) IT MAY CONDUCT ITS BUSINESS AND AFFAIRS, HAVE OFFICES, 684
AND EXERCISE ITS POWER IN THE UNITED STATES OR IN ANY FOREIGN 685
COUNTRY. 686
(E) IT MAY ESTABLISH RESERVES AND INVEST THESE FUNDS. 688
(F) It may buy, hold, and exercise all privileges of 690
ownership over such real or personal property as is necessary, 691
convenient, or incidental to the conduct of any authorized 692
business of the association.
(G) It may establish, secure, own, and develop patents, 694
trademarks, and copyrights. 695
(H) NOTWITHSTANDING CHAPTER 169. OF THE REVISED CODE, IT 698
MAY EFFECT THE FORFEITURE OF ANY UNCLAIMED FUNDS, INCLUDING ANY 699
UNCLAIMED STOCKS OR OTHER EQUITY INTERESTS, DIVIDENDS, AND 700
PATRONAGE ALLOCATIONS, FOR WHICH THE OWNER CANNOT BE FOUND AFTER 702
A PERIOD OF THREE YEARS. NOTICE OF THE EXISTENCE OF THESE 703
UNCLAIMED FUNDS AND A REQUEST FOR WRITTEN ACKNOWLEDGMENT FROM THE
OWNER TO THE ASSOCIATION SHALL BE EVIDENCE OF A BONA FIDE ATTEMPT 704
TO DELIVER THE UNCLAIMED FUNDS TO THE OWNER. IF THE NOTICE IS 705
16
NOT ACKNOWLEDGED WITHIN THIRTY DAYS AFTER THE NOTICE IS SENT OR 706
WITHIN THE PERIOD SPECIFIED IN THE NOTICE, IF LONGER, ALL SUCH 707
UNCLAIMED FUNDS SPECIFIED IN THE NOTICE ARE THEREAFTER FORFEITED 708
AND BECOME THE PROPERTY OF THE ASSOCIATION.
(I) IT MAY MAKE DONATIONS FOR CHARITABLE, SCIENTIFIC, 710
EDUCATIONAL, COMMUNITY DEVELOPMENT, OR RELIGIOUS PURPOSES, AND 711
MAY USE ALL OR PART OF THE FUNDS FORFEITED TO THE ASSOCIATION 712
UNDER DIVISION (H) FOR THESE PURPOSES. 713
(J) It may do everything necessary, suitable, or proper 715
for the accomplishment of any of the purposes enumerated in this 716
section, or conducive to or expedient for the interest or benefit 718
of the association, and may contract accordingly. In addition it 719
may exercise and possess all powers, rights, and privileges 720
necessary or incidental to the purposes for which the association 721
is organized or to the activities in which it is engaged, and
also any other powers, rights, and privileges granted to ordinary 723
corporations by the laws of this state, except such as are 725
inconsistent with the express provisions of sections 1729.01 to 726
1729.27, inclusive, of the Revised Code, it may do any such thing 728
anywhere THIS CHAPTER.
Sec. 1729.04. (A) THE NAME OF ANY ASSOCIATION ORGANIZED 730
UNDER THIS CHAPTER SHALL INCLUDE THE WORD OR ABBREVIATION 731
"COOPERATIVE," "COOP," "CO-OPERATIVE," "CO-OP," "ASSOCIATION," 733
"ASSN.," "COMPANY," "CO.," "INCORPORATED," "INC.," "CORPORATION," 734
OR "CORP."
(B) NO CORPORATION, ASSOCIATION, OR OTHER PERSON ORGANIZED 736
OR APPLYING TO DO BUSINESS IN THIS STATE SHALL USE THE WORD OR 737
ABBREVIATION "COOPERATIVE," "COOP," "CO-OPERATIVE," OR "CO-OP" AS 739
A PART OF ITS CORPORATE OR OTHER BUSINESS NAME OR TITLE, UNLESS 740
AT LEAST ONE OF THE FOLLOWING APPLIES: 741
(1) IT HAS COMPLIED WITH THIS CHAPTER. 743
(2) IT IS ORGANIZED AND OPERATING ON A COOPERATIVE BASIS 746
UNDER CHAPTER 1702. OF THE REVISED CODE. 747
(3) IT IS ORGANIZED AND OPERATING IN ACCORDANCE WITH THE 750
17
COOPERATIVE LAWS OF ANOTHER STATE, THE DISTRICT OF COLUMBIA, OR 751
THE UNITED STATES. 752
Sec. 1729.05 1729.06. Five (A) TWO or more persons, a 763
majority of whom are residents of this state and engaged in the 764
production of agricultural products, INDIVIDUALS may form a 765
nonprofit co-operative AN association, with or without capital 766
stock, under sections 1729.01 to 1729.27, inclusive, of the 768
Revised Code UNDER THIS CHAPTER. 769
(B)(1) EVERY ASSOCIATION SHALL HAVE AND MAINTAIN A 772
STATUTORY AGENT UPON WHOM ANY PROCESS, NOTICE, OR DEMAND AGAINST 773
THE ASSOCIATION MAY BE SERVED. THE AGENT MAY BE A NATURAL PERSON 774
WHO IS A RESIDENT OF THIS STATE OR A CORPORATION THAT IS 775
AUTHORIZED BY ITS ARTICLES OF INCORPORATION TO ACT AS SUCH AGENT 776
AND HAS A BUSINESS ADDRESS IN THIS STATE. 777
(2) WHENEVER APPOINTMENT OR DESIGNATION OF A STATUTORY 779
AGENT IS REQUIRED BY THIS CHAPTER, THE APPOINTMENT OR DESIGNATION 781
SHALL BE ON A FORM PRESCRIBED BY THE SECRETARY OF STATE AND SHALL 782
CONFORM WITH SECTION 1702.06 OF THE REVISED CODE. 783
Sec. 1729.07. (A) THE ARTICLES OF INCORPORATION OF AN 785
ASSOCIATION SHALL SET FORTH ALL OF THE FOLLOWING: 786
(1) THE NAME OF THE ASSOCIATION; 788
(2) THE ASSOCIATION'S PURPOSES, AS PERMITTED BY THIS 790
CHAPTER. IT IS SUFFICIENT TO STATE IN THE ARTICLES THAT THE 792
ASSOCIATION MAY ENGAGE IN ANY ACTIVITY WITHIN THE PURPOSES FOR 793
WHICH ASSOCIATIONS MAY BE ORGANIZED UNDER THIS CHAPTER.
(3) THE COUNTY AND MUNICIPAL CORPORATION OR TOWNSHIP WHERE 795
THE ASSOCIATION'S PRINCIPAL PLACE OF BUSINESS WILL BE LOCATED; 796
(4) THE NAMES AND ADDRESSES OF THE INCORPORATORS; 798
(5) THE NUMBER OF ITS DIRECTORS OR A STATEMENT THAT THE 800
NUMBER OF DIRECTORS SHALL BE AS SPECIFIED IN THE BYLAWS; 801
(6) THE NAMES AND ADDRESSES OF THOSE WHO ARE TO SERVE AS 803
DIRECTORS UNTIL THE FIRST ANNUAL MEETING OR UNTIL THE ELECTION 804
AND QUALIFICATION OF THEIR SUCCESSORS; 805
(7) WHETHER THE ASSOCIATION IS ORGANIZED WITH OR WITHOUT 807
18
CAPITAL STOCK.
(a) IF THE ASSOCIATION IS ORGANIZED WITHOUT CAPITAL STOCK, 809
THE ARTICLES SHALL SET FORTH THE GENERAL RULES BY WHICH THE 810
PROPERTY RIGHTS AND INTERESTS OF EACH MEMBER ARE TO BE 811
DETERMINED.
(b) IF THE ASSOCIATION IS ORGANIZED WITH CAPITAL STOCK, 813
THE TOTAL AMOUNT OF THE STOCK, THE NUMBER AND PAR VALUE OF THE 814
SHARES, AND DIVIDEND RIGHTS, IF ANY. IF THERE IS MORE THAN ONE 815
CLASS OF STOCK, THE ARTICLES SHALL SET FORTH A STATEMENT OF THE 816
NUMBER OF SHARES IN EACH CLASS AND A STATEMENT OF THE 817
DESIGNATIONS, PREFERENCES, RIGHTS, AND LIMITATIONS OF THE SHARES
IN EACH CLASS. 818
(B) THE ARTICLES MAY INCLUDE ADDITIONAL PROVISIONS, 820
CONSISTENT WITH LAW, INCLUDING PROVISIONS THAT ARE REQUIRED OR 821
PERMITTED TO BE SET FORTH IN THE BYLAWS. 822
(C) THE ARTICLES SHALL BE SIGNED BY THE INCORPORATORS AND 824
FILED WITH THE SECRETARY OF STATE IN ACCORDANCE WITH SECTION 825
1729.12 OF THE REVISED CODE. THE ARTICLES SHALL BE ACCOMPANIED 826
BY THE APPOINTMENT OF A STATUTORY AGENT IN ACCORDANCE WITH 827
DIVISION (B) OF SECTION 1729.06 OF THE REVISED CODE. THE LEGAL
EXISTENCE OF AN ASSOCIATION BEGINS UPON THE FILING OF THE 829
ARTICLES AND, UNLESS THE ARTICLES PROVIDE OTHERWISE, ITS PERIOD 830
OF EXISTENCE IS PERPETUAL.
Sec. 1729.07 1729.08. (A) The articles of incorporation 840
of an association may be altered or amended at any regular 841
meeting of the association or at any special meeting called for 842
that purpose, PROVIDED THAT THE TEXT OF THE PROPOSED CHANGE, OR A 843
GENERAL DESCRIPTION OF THE CHANGE, IS CONTAINED IN THE NOTICE OF
THE MEETING. An amendment must SHALL first be approved by two 845
thirds of the directors and must SHALL then be adopted by a AN 846
AFFIRMATIVE vote representing a majority of all the members of 849
the association OF SIXTY PER CENT OF THE MEMBER VOTES CAST ON THE 850
AMENDMENT OR, IF THE ARTICLES PROVIDE OR PERMIT, BY THE 851
AFFIRMATIVE VOTE OF A GREATER MAJORITY OR BY THE AFFIRMATIVE VOTE 852
19
OF A SIMPLE MAJORITY OF ALL MEMBER VOTES ELIGIBLE TO BE CAST ON 853
THE AMENDMENT. Amendments 854
(B) AMENDMENTS to the articles of incorporation, when so 857
adopted, shall be filed in accordance with sections 1701.01 to 858
1702.58, inclusive, SECTION 1729.12 of the Revised Code. 859
(C) THE BOARD OF AN ASSOCIATION MAY ADOPT A RESTATEMENT OF 862
THE ARTICLES THAT INCORPORATES AMENDMENTS PREVIOUSLY APPROVED BY 863
THE BOARD AND ADOPTED BY THE MEMBERS. AN ASSOCIATION MAY, BY 864
ACTION TAKEN IN THE MANNER REQUIRED FOR AN AMENDMENT, ADOPT 865
RESTATED ARTICLES THAT CONTAIN AMENDMENTS MADE AT THE TIME OF THE 866
RESTATEMENT. RESTATED ARTICLES SHALL STATE THAT THEY ARE 867
RESTATED, OR RESTATED AND AMENDED, IF AMENDMENTS ARE ADOPTED WITH 868
THE RESTATEMENT, AND SHALL SUPERSEDE THE EXISTING ARTICLES AND
AMENDMENTS. RESTATED ARTICLES SHALL MEET THE REQUIREMENTS OF 869
SECTION 1729.07 OF THE REVISED CODE, EXCEPT THAT THE NAMES AND 870
ADDRESSES OF THE INCORPORATORS AND INITIAL DIRECTORS MAY BE 871
OMITTED. A RESTATEMENT OF THE ARTICLES SHALL BE FILED IN THE
MANNER PRESCRIBED FOR AN AMENDMENT OF THE ARTICLES. 872
(D) EXCEPT AS PROVIDED IN THE ARTICLES OF INCORPORATION, 875
THE BOARD MAY ADOPT AN AMENDMENT TO THE ARTICLES OF INCORPORATION 876
WITHOUT A MEMBER VOTE IN ANY OF THE FOLLOWING CASES: 877
(1) TO CHANGE THE PRINCIPAL PLACE OF BUSINESS OF THE 879
ASSOCIATION; 880
(2) TO DESIGNATE AND DETERMINE THE RIGHTS AND RESTRICTIONS 882
OF A SERIES WITHIN A CLASS OF CAPITAL STOCK, IF PERMITTED BY THE 883
ARTICLES; 884
(3) TO REDUCE THE AUTHORIZED NUMBER OF SHARES OF ANY CLASS 886
OR SERIES OF CAPITAL STOCK TO ANY NUMBER DOWN TO AND INCLUDING 887
THE NUMBER OF THE SHARES ISSUED AND OUTSTANDING, AND TO ASSIGN 888
THE AUTHORIZATION FOR THE NUMBER OF SHARES SO REDUCED TO ANOTHER 889
CLASS OR CLASSES OF CAPITAL STOCK PREVIOUSLY AUTHORIZED; 890
(4) AFTER A MERGER, CONSOLIDATION, CONVERSION, DIVISION, 892
OR OCCURRENCE OF ANY OTHER CONTINGENT EVENT REFERRED TO IN THE 893
ARTICLES OF INCORPORATION, TO ELIMINATE FROM THE ARTICLES ANY 894
20
STATEMENT OR PROVISION PERTAINING EXCLUSIVELY TO THE MERGER, 895
CONSOLIDATION, CONVERSION, DIVISION, OR OCCURRENCE, AND TO MAKE 896
OTHER CHANGES REQUIRED BY SUCH ELIMINATION. 897
Sec. 1729.09. (A)(1) UNLESS THE BOARD PROVIDES THAT 900
DIVISION (A)(3) OF THIS SECTION APPLIES TO AN AMENDMENT TO THE 901
ARTICLES OF INCORPORATION, A HOLDER OF STOCK OTHER THAN
MEMBERSHIP STOCK OR PATRONAGE STOCK WHO IS AFFECTED BY A PROPOSED 903
AMENDMENT TO THE ARTICLES SHALL BE ENTITLED TO CAST ONE VOTE ON 905
THE AMENDMENT REGARDLESS OF THE PAR OR STATED VALUE OF THE STOCK, 906
THE NUMBER OF SHARES, OR THE NUMBER OF AFFECTED CLASSES OF STOCK 908
HELD.
(2) A MEMBER HOLDING STOCK AFFECTED BY A PROPOSED 910
AMENDMENT MAY VOTE ONLY AS A MEMBER AND SHALL NOT BE ENTITLED TO 911
VOTE OR DEMAND FAIR CASH VALUE AS AN AFFECTED STOCKHOLDER. 912
(3) THE BOARD MAY PROVIDE THAT A STOCKHOLDER OTHERWISE 914
ENTITLED TO VOTE UNDER DIVISION (A)(1) OF THIS SECTION SHALL 915
INSTEAD BE ENTITLED TO PAYMENT OF FAIR CASH VALUE OF THE AFFECTED 916
STOCK HELD BY SUCH STOCKHOLDER IN ACCORDANCE WITH SECTION 1729.46 918
OF THE REVISED CODE.
(B) FOR PURPOSES OF THIS SECTION, A HOLDER OF STOCK IS 920
AFFECTED AS TO ANY CLASS OF STOCK OWNED BY THE HOLDER ONLY IF AN 921
AMENDMENT WOULD EXPRESSLY DO ANY OF THE FOLLOWING: 922
(1) DECREASE THE DIVIDENDS TO WHICH THAT CLASS MAY BE 924
ENTITLED OR CHANGE THE METHOD BY WHICH THE DIVIDEND RATE ON THAT 925
CLASS IS FIXED;
(2) FURTHER RESTRICT RIGHTS TO TRANSFER THAT CLASS; 927
(3) GIVE TO ANOTHER EXISTING OR ANY NEW CLASS OF STOCK OR 929
EQUITY INTEREST NOT PREVIOUSLY ENTITLED THERETO ANY PREFERENCE, 930
AS TO DIVIDENDS OR UPON DISSOLUTION, THAT IS HIGHER THAN 931
PREFERENCES OF THAT CLASS;
(4) CHANGE THE PAR VALUE OF SHARES OF THAT CLASS OR OF ANY 933
OTHER CLASS HAVING THE SAME OR HIGHER PREFERENCES AS TO DIVIDENDS 934
OR UPON DISSOLUTION;
(5) INCREASE THE NUMBER OF AUTHORIZED SHARES OF ANY CLASS 936
21
HAVING A HIGHER PREFERENCE AS TO DIVIDENDS OR UPON DISSOLUTION; 937
(6) REQUIRE OR PERMIT AN EXCHANGE OF SHARES OF ANY CLASS 939
WITH LOWER PREFERENCES AS TO DIVIDENDS OR UPON DISSOLUTION FOR 940
SHARES OF ANY OTHER CLASS WITH HIGHER PREFERENCES. 941
(C) IF ANY PROPOSED AMENDMENT WILL ALTER OR CHANGE THE 943
POWERS, PREFERENCES, OR SPECIAL RIGHTS OF ONE OR MORE SERIES OF 944
ANY CLASS SO AS TO AFFECT THEM ADVERSELY, BUT SHALL NOT SO AFFECT 945
THE ENTIRE CLASS, THEN ONLY THE SHARES OF THE SERIES SO AFFECTED 946
BY THE AMENDMENT SHALL BE CONSIDERED A SEPARATE CLASS FOR THE 947
PURPOSES OF DIVISION (B) OF THIS SECTION.
(D) IF STOCKHOLDERS ARE ENTITLED TO VOTE ON AN AMENDMENT, 949
THE AMENDMENT IS ADOPTED ONLY IF ALL OF THE FOLLOWING CONDITIONS 950
ARE MET:
(1) NOTICE OF THE MEETING, AN EXACT COPY OF THE PROPOSED 952
AMENDMENT, AND A BALLOT ON THE AMENDMENT HAVE BEEN SENT TO EACH 953
AFFECTED STOCKHOLDER;
(2) APPROVAL BY THE MEMBERS UNDER SECTION 1729.08 OF THE 955
REVISED CODE;
(3) APPROVAL BY A SIMPLE MAJORITY OF THE AFFECTED 957
STOCKHOLDERS PRESENT AND VOTING AT A MEETING OF THE STOCKHOLDERS. 958
(E) THIS SECTION DOES NOT APPLY TO STOCK ISSUED PRIOR TO 960
THE EFFECTIVE DATE OF THIS SECTION, UNLESS THE ASSOCIATION ADOPTS 961
AN AMENDMENT TO ITS ARTICLES OF INCORPORATION MAKING THE STOCK 963
SUBJECT TO THIS SECTION. AS TO SUCH STOCK, AN AMENDMENT SHALL 964
FIRST BE APPROVED BY TWO-THIRDS OF THE DIRECTORS AND SHALL THEN 965
BE ADOPTED BY A VOTE REPRESENTING A MAJORITY OF ALL THE MEMBERS 966
OF THE ASSOCIATION.
Sec. 1729.10. (A) A COPY OF THE ASSOCIATION'S ARTICLES OF 968
INCORPORATION OR AMENDED ARTICLES FILED IN THE OFFICE OF THE 969
SECRETARY OF STATE, AND CERTIFIED BY THE SECRETARY OF STATE, IS 970
CONCLUSIVE EVIDENCE, EXCEPT AS AGAINST THE STATE, THAT THE 971
ASSOCIATION HAS BEEN INCORPORATED UNDER THE LAWS OF THIS STATE; 972
AND A COPY CERTIFIED BY THE SECRETARY OF STATE OF ANY CERTIFICATE 973
OF AMENDMENT OR OTHER CERTIFICATE IS PRIMA-FACIE EVIDENCE OF SUCH
22
AMENDMENT OR OF THE FACTS STATED IN THE CERTIFICATE, AND OF THE 974
OBSERVANCE AND PERFORMANCE OF ALL ANTECEDENT CONDITIONS NECESSARY 975
TO THE ACTION THAT THE CERTIFICATE PURPORTS TO EVIDENCE. 976
(B) A COPY OF AMENDED ARTICLES FILED IN THE OFFICE OF THE 978
SECRETARY OF STATE, AND CERTIFIED BY THE SECRETARY OF STATE, 979
SHALL BE ACCEPTED IN THIS STATE AND OTHER JURISDICTIONS IN LIEU 980
OF THE ORIGINAL ARTICLES, AMENDMENTS TO THE ARTICLES, AND PRIOR 981
AMENDED ARTICLES.
(C) THE ORIGINAL OR A COPY OF THE RECORD OF MINUTES OF THE 983
PROCEEDINGS OF THE INCORPORATORS OF AN ASSOCIATION, OR OF THE 984
PROCEEDINGS OR MEETINGS OF THE MEMBERS OR ANY CLASS OF 985
STOCKHOLDERS, OR OF THE DIRECTORS, OR OF ANY COMMITTEE THEREOF, 986
INCLUDING ANY WRITTEN CONSENT, WAIVER, RELEASE, OR AGREEMENT 987
ENTERED IN SUCH RECORD OR MINUTES, OR THE ORIGINAL OR A COPY OF A
STATEMENT THAT NO SPECIFIED PROCEEDING WAS HAD OR THAT NO 988
SPECIFIED CONSENT, WAIVER, RELEASE, OR AGREEMENT EXISTS, SHALL, 989
WHEN CERTIFIED TO BE TRUE BY THE SECRETARY OR AN ASSISTANT 990
SECRETARY OF AN ASSOCIATION, BE RECEIVED IN THE COURTS AS 991
PRIMA-FACIE EVIDENCE OF THE FACTS STATED THEREIN. EVERY MEETING
REFERRED TO IN THE CERTIFIED ORIGINAL OR COPY IS CONSIDERED DULY 992
CALLED AND HELD, AND ALL MOTIONS AND RESOLUTIONS ADOPTED AND 994
PROCEEDINGS HAD AT THE MEETING ARE CONSIDERED DULY ADOPTED AND 995
HAD, AND ALL ELECTIONS OF DIRECTORS AND ALL ELECTIONS OR 997
APPOINTMENTS OF OFFICERS CHOSEN AT THE MEETING ARE CONSIDERED
VALID, UNTIL THE CONTRARY IS PROVED; AND WHENEVER A PERSON WHO IS 999
NOT A MEMBER, PATRON, OR STOCKHOLDER OF AN ASSOCIATION HAS ACTED 1,000
IN GOOD FAITH IN RELIANCE UPON ANY SUCH CERTIFIED ORIGINAL OR 1,001
COPY, IT IS CONCLUSIVE IN THAT PERSON'S FAVOR.
Sec. 1729.11. (A) AN ASSOCIATION WHOSE ARTICLES OF 1,003
INCORPORATION HAVE BEEN CANCELED OR AN ASSOCIATION THAT HAS BEEN 1,004
DISSOLVED IN A MANNER OTHER THAN FOR A VOLUNTARY DISSOLUTION AS 1,005
PROVIDED IN SECTION 1729.55 OF THE REVISED CODE, OR A JUDICIAL 1,006
DISSOLUTION AS PROVIDED IN SECTION 1729.61 OF THE REVISED CODE,
MAY BE REINSTATED BY FILING, ON A FORM PRESCRIBED BY THE 1,007
23
SECRETARY OF STATE, AN APPLICATION FOR REINSTATEMENT AND THE 1,008
REQUIRED APPOINTMENT OF A STATUTORY AGENT, AND BY PAYING A FILING 1,009
FEE OF TEN DOLLARS.
(B) UPON REINSTATEMENT OF AN ASSOCIATION'S ARTICLES OF 1,011
INCORPORATION, THE RIGHTS, PRIVILEGES, AND FRANCHISES, INCLUDING 1,012
ALL REAL OR PERSONAL PROPERTY RIGHTS AND CREDITS AND ALL CONTRACT 1,013
AND OTHER RIGHTS, OF THE ASSOCIATION EXISTING AT THE TIME THAT 1,014
ITS ARTICLES WERE CANCELED OR THE DISSOLUTION BECAME EFFECTIVE 1,015
SHALL BE CONTINUED IN EFFECT AS IF THE ARTICLES HAD NOT BEEN 1,016
CANCELED OR THE DISSOLUTION HAD NOT OCCURRED; AND THE ASSOCIATION
SHALL AGAIN BE ENTITLED TO EXERCISE THE RIGHTS, PRIVILEGES, AND 1,017
FRANCHISES AUTHORIZED BY ITS ARTICLES. 1,018
Sec. 1729.12. (A) FOR FILING ARTICLES OF INCORPORATION OR 1,020
A CERTIFICATE OF AMENDMENT OF ARTICLES OR A CERTIFICATE OF 1,022
MERGER, CONSOLIDATION, DIVISION, OR DISSOLUTION, AND WITH RESPECT 1,023
TO THE ISSUANCE OF SHARES OF STOCK, AN ASSOCIATION ORGANIZED 1,024
UNDER THIS CHAPTER SHALL PAY TO THE SECRETARY OF STATE THE FEES 1,025
IMPOSED BY SECTION 111.16 OF THE REVISED CODE. IN THE CASE OF A
CERTIFICATE OF DIVISION, THE FILING FEE SHALL BE THE SAME AS FOR 1,026
A CERTIFICATE OF MERGER OR CONSOLIDATION. 1,027
(B) WHEN THE ARTICLES OF INCORPORATION, OR A CERTIFICATE 1,030
OF AMENDMENT OF ARTICLES, OR A CERTIFICATE OF MERGER,
CONSOLIDATION, CONVERSION, DIVISION, OR DISSOLUTION IS FILED WITH 1,031
THE SECRETARY OF STATE, THE SECRETARY OF STATE SHALL, IF THE 1,033
ARTICLES OR CERTIFICATE COMPLIES WITH THIS CHAPTER, ENDORSE 1,034
APPROVAL THEREON, THE DATE OF FILING, A FILE NUMBER, AND MAKE A 1,035
LEGIBLE COPY THEREOF BY ANY AUTHORIZED METHOD. THE ORIGINAL OR A 1,036
COPY OF THE ARTICLES OR CERTIFICATE, CERTIFIED BY THE SECRETARY 1,037
OF STATE, SHALL BE RETURNED TO THE PERSON FILING THE ARTICLES OR 1,038
CERTIFICATE.
(C) ALL PERSONS SHALL HAVE THE OPPORTUNITY TO ACQUIRE A 1,040
COPY OF THE ARTICLES AND OTHER CERTIFICATES FILED AND RECORDED IN 1,041
THE OFFICE OF THE SECRETARY OF STATE, BUT NO PERSON DEALING WITH 1,042
THE ASSOCIATION SHALL BE CHARGED WITH CONSTRUCTIVE NOTICE OF THE 1,043
24
CONTENTS OF ANY SUCH ARTICLES OR CERTIFICATES BY REASON OF THE 1,044
FILING OR RECORDING.
Sec. 1729.13. (A) AN ASSOCIATION MAY PAY DIVIDENDS 1,046
ANNUALLY ON ITS CAPITAL STOCK. ALL ITS OTHER NET INCOME FROM 1,047
BUSINESS WITH OR FOR MEMBERS AND OTHER ELIGIBLE PATRONS, LESS 1,048
RESERVES WHICH SHALL BE PROVIDED FOR IN THE BYLAWS OR OTHER 1,049
WRITTEN AGREEMENTS, SHALL BE DISTRIBUTED TO ITS MEMBERS AND OTHER 1,050
ELIGIBLE PATRONS ON THE BASIS OF PATRONAGE AS PROVIDED IN THE
BYLAWS OR OTHER WRITTEN AGREEMENTS. ANY RECEIPTS OR DIVIDENDS 1,051
FROM SUBSIDIARY CORPORATIONS, OR FROM STOCK OR OTHER SECURITIES 1,052
OWNED BY THE ASSOCIATION, MAY BE INCLUDED IN THE ORDINARY 1,053
RECEIPTS OF THE ASSOCIATION, AND MAY BE DISTRIBUTED ACCORDINGLY. 1,054
(B) AN ASSOCIATION, AT ANY TIME, MAY PURCHASE ITS OWN 1,056
COMMON STOCK AT PAR OR BOOK VALUE AS DETERMINED BY THE BOARD. 1,057
(C) AN ASSOCIATION SHALL HAVE A CONTINUED PERFECTED 1,060
SECURITY INTEREST IN ITS MEMBERSHIP STOCK AND PATRONAGE STOCK TO 1,061
SECURE PAYMENT OF ANY INDEBTEDNESS OR OTHER OBLIGATION OF THE 1,062
HOLDER OR OWNER TO THE ASSOCIATION. NOTWITHSTANDING CHAPTERS 1,064
1308. AND 1309. OF THE REVISED CODE, THE SECURITY INTEREST SHALL 1,067
HAVE PRIORITY OVER ALL OTHER PERFECTED SECURITY INTERESTS.
UNLESS OTHERWISE PROVIDED IN THE ASSOCIATION'S ARTICLES OF 1,068
INCORPORATION OR BYLAWS, OR BY CONTRACT, A MEMBER OR OTHER PATRON 1,070
HAS NO RIGHT TO COMPEL AN ASSOCIATION TO OFFSET ITS MEMBERSHIP 1,071
STOCK OR PATRONAGE STOCK AGAINST ANY INDEBTEDNESS OR OBLIGATION 1,072
OWED TO THE ASSOCIATION.
Sec. 1729.14. EACH ASSOCIATION SHALL ADOPT FOR ITS 1,074
GOVERNANCE AND MANAGEMENT, BYLAWS THAT ARE CONSISTENT WITH THE 1,075
POWERS GRANTED BY THIS CHAPTER AND THE ARTICLES OF INCORPORATION 1,076
OF THE ASSOCIATION. THE BYLAWS MAY PROVIDE FOR ANY OF THE 1,077
FOLLOWING: 1,078
(A) THE TIME, PLACE, AND MANNER OF CALLING AND CONDUCTING 1,080
THE ASSOCIATION'S MEETINGS; 1,081
(B) THE NUMBER OF MEMBERS CONSTITUTING A QUORUM. IF 1,083
VOTING BY ANY METHOD OTHER THAN PERSONAL APPEARANCE IS USED, 1,084
25
MEMBERS REPRESENTED BY A BALLOT OR BY PROXY MAY BE COUNTED IN 1,085
COMPUTING A QUORUM ONLY ON THOSE MATTERS FOR WHICH THE BALLOTS OR 1,086
PROXIES WERE SUBMITTED.
(C) THE RIGHT OF MEMBERS TO VOTE BY PROXY OR BY BALLOT 1,088
DELIVERED IN PERSON, BY MAIL, BY ELECTRONIC OR TELEPHONIC 1,089
TRANSMITTAL, OR ANY COMBINATION OF THESE, AND THE CONDITIONS, 1,090
MANNER, FORM, AND EFFECT OF SUCH VOTES; 1,091
(D) SUBJECT TO THE PROVISIONS OF SECTION 1729.17 OF THE 1,093
REVISED CODE, A METHOD OF VOTING BY MEMBERS OR DELEGATES, AND ANY 1,094
LIMITATIONS ON VOTING RIGHTS OF ANY GROUP OR CLASS OF MEMBERS OR 1,095
DELEGATES;
(E) THE NUMBER OF DIRECTORS CONSTITUTING A QUORUM; 1,097
(F) THE NUMBER, QUALIFICATIONS, COMPENSATION, DUTIES, AND 1,099
TERMS OF OFFICE OF DIRECTORS AND OFFICERS, AND THE TIME OF THEIR 1,100
ELECTION AND THE MANNER OF GIVING NOTICE OF THE ELECTION; 1,101
(G) PENALTIES FOR VIOLATION OF THE BYLAWS; 1,103
(H) THE AMOUNTS OF ENTRANCE, ORGANIZATION, AND MEMBERSHIP 1,105
FEES, IF ANY; THE MANNER OF COLLECTING THEM; AND THE PURPOSES FOR 1,106
WHICH THEY MAY BE USED; 1,107
(I) ANY AMOUNT THAT EACH MEMBER IS REQUIRED TO PAY 1,109
ANNUALLY OR FROM TIME TO TIME TO CARRY ON THE BUSINESS OF THE 1,110
ASSOCIATION; ANY CHARGE TO BE PAID BY EACH MEMBER FOR SERVICES 1,111
RENDERED BY THE ASSOCIATION, AND THE TIME OF PAYMENT AND THE 1,112
MANNER OF COLLECTION OF SUCH CHARGE; AND ANY MARKETING CONTRACT 1,113
BETWEEN THE ASSOCIATION AND ITS MEMBERS THAT EVERY MEMBER MAY BE
REQUIRED TO SIGN; 1,114
(J) THE NUMBER AND QUALIFICATIONS OF MEMBERS OF THE 1,116
ASSOCIATION AND THE CONDITIONS OF MEMBERSHIP OR FOR OWNERSHIP OF 1,117
MEMBERSHIP STOCK IN THE ASSOCIATION; 1,118
(K) THE TIME AND MANNER OF PERMITTING MEMBERS TO WITHDRAW 1,120
OR THE HOLDERS OF MEMBERSHIP STOCK TO TRANSFER THEIR STOCK; AND 1,121
THE MANNER OF ASSIGNMENT AND TRANSFER OF MEMBERSHIP STOCK; 1,123
(L) THE CONDITIONS UPON WHICH, AND THE TIME WHEN, THE 1,125
MEMBERSHIP OF ANY MEMBER CEASES; AND THE SUSPENSION OF THE RIGHTS 1,126
26
OF A MEMBER WHO CEASES TO BE ELIGIBLE FOR MEMBERSHIP IN THE 1,127
ASSOCIATION;
(M) THE MANNER AND EFFECT OF THE EXPULSION OF A MEMBER; 1,129
(N) IN THE EVENT OF THE DEATH OR WITHDRAWAL OF A MEMBER OR 1,131
UPON THE EXPULSION OF A MEMBER OR THE FORFEITURE OF MEMBERSHIP, 1,133
ANY OF THE FOLLOWING:
(1) THE MANNER OF DETERMINING THE VALUE OF A MEMBER'S 1,135
INTEREST;
(2) PROVISION FOR THE PURCHASE OF A MEMBER'S INTEREST BY 1,137
THE ASSOCIATION;
(3) AT THE OPTION OF THE ASSOCIATION, PROVISION FOR SUCH 1,139
PURCHASE AT A PRICE FIXED BY APPRAISAL BY THE BOARD OF DIRECTORS 1,140
OF THE ASSOCIATION.
(O) ANY OTHER PROVISION FOR ANY MATTER RELATIVE TO THE 1,142
CONTROL, REGULATION, OPERATION, MANAGEMENT, OR GOVERNMENT OF THE 1,143
ASSOCIATION.
Sec. 1729.16. (A) THE INITIAL BYLAWS MAY BE ADOPTED BY 1,145
THE ASSOCIATION'S DIRECTORS WHO ARE TO SERVE UNTIL THE FIRST 1,146
ANNUAL MEETING. AFTER THE INITIAL BYLAWS ARE ADOPTED, BYLAWS MAY 1,148
BE ADOPTED AND AMENDED ONLY BY THE MEMBERS UNLESS THE MEMBERS 1,149
ADOPT A BYLAW THAT PERMITS THE BOARD TO MAKE AND AMEND SPECIFIED 1,150
BYLAWS.
(B) ANY BYLAW ADOPTED OR AMENDED BY THE BOARD SHALL BE 1,152
REPORTED AT THE NEXT REGULAR MEMBER MEETING. ANY SUCH BYLAW IS 1,153
SUBJECT TO AMENDMENT OR REPEAL BY THE MEMBERS AT ANY TIME. 1,154
(C) UNLESS THE BYLAWS PROVIDE OTHERWISE, ANY BYLAW MAY BE 1,156
ADOPTED, AMENDED, OR REPEALED BY A MAJORITY OF THE MEMBER VOTES 1,157
CAST ON THE ADOPTION, AMENDMENT, OR REPEAL. 1,158
Sec. 1729.17. (A) EACH MEMBER ENTITLED TO VOTE SHALL HAVE 1,160
ONE VOTE, EXCEPT THAT THE ARTICLES OR BYLAWS OF THE ASSOCIATION 1,161
MAY PERMIT THE FOLLOWING: 1,162
(1) VOTING BY MEMBERS IN ACCORDANCE WITH THE AMOUNT OF 1,164
BUSINESS DONE WITH OR THROUGH THE ASSOCIATION. 1,165
(2) VOTING BY DELEGATES, INCLUDING A VOTING SYSTEM THAT 1,167
27
PROVIDES ANY ONE OR A COMBINATION OF THE FOLLOWING: 1,168
(a) THAT A DELEGATE MAY CAST ONLY ONE VOTE; 1,170
(b) THAT A DELEGATE MAY CAST ONE VOTE FOR EACH MEMBER 1,172
REPRESENTED BY THE DELEGATE; 1,173
(c) THAT ANOTHER FORM OF DELEGATE VOTING MAY BE USED. 1,175
(3) VOTING BY DELEGATES OR CERTAIN MEMBERS ON MATTERS THAT 1,177
ARE TO BE SUBMITTED TO A MEMBER VOTE. 1,178
(4) VOTING BY ANY COMBINATION OF THE METHODS SET FORTH IN 1,180
DIVISION (A)(1), (2), OR (3) OF THIS SECTION OR ANY OTHER METHOD 1,182
OF VOTING SET FORTH IN THE BYLAWS, PROVIDED THE ASSOCIATION IS
CONTROLLED BY THE MEMBERS. 1,183
(B) IF THE ARTICLES OR BYLAWS PROVIDE THAT ONLY DELEGATES 1,185
OR CERTAIN MEMBERS ARE ENTITLED TO VOTE ON MATTERS TO BE 1,186
SUBMITTED TO A MEMBER VOTE, "MEMBER" OR "MEMBERS," AS USED IN 1,187
THIS CHAPTER WITH RESPECT TO THE RIGHT OF A MEMBER TO VOTE, 1,188
VOTING PROCEDURE, THE REQUIRED PROPORTION OF MEMBER VOTES, 1,189
ACTIONS THAT ARE REQUIRED OR PERMITTED TO BE TAKEN BY MEMBERS,
AND THE NUMBER OF MEMBERS REQUIRED FOR A QUORUM, MEANS THE 1,190
DELEGATES OR OTHER MEMBERS ENTITLED TO VOTE. WHERE VOTING IS 1,191
BASED ON THE AMOUNT OF BUSINESS DONE, PROVISIONS OF THIS CHAPTER 1,192
REQUIRING A VOTE OF THE MEMBERS ARE MET IF THE REQUIRED 1,193
MEMBERSHIP VOTE IS SATISFIED BASED ON THE VOTING POWER OF THE 1,194
MEMBERS.
Sec. 1729.18. (A) AN ASSOCIATION SHALL HAVE TWO OR MORE 1,196
MEMBERS. HOWEVER, AN ASSOCIATION MAY HAVE ONE MEMBER IF THAT 1,197
MEMBER IS AN ASSOCIATION THAT HAS TWO OR MORE MEMBERS. 1,198
(B) EACH ASSOCIATION SHALL HOLD AN ANNUAL MEETING OF ITS 1,200
MEMBERS. THE BOARD MAY CALL A SPECIAL MEETING OF THE MEMBERS AT 1,202
ANY TIME. ANY MEETING OF THE MEMBERS MAY BE HELD AT ONE TIME OR
IN A SERIES OF MEETINGS AT ONE OR MORE LOCATIONS. 1,203
(C) TWENTY PER CENT OF THE MEMBERS ENTITLED TO VOTE MAY 1,205
FILE WITH THE BOARD A PETITION STATING THE SPECIFIC BUSINESS TO 1,206
BE BROUGHT BEFORE THE ASSOCIATION AND DEMANDING A SPECIAL MEETING 1,207
AT ANY TIME FOR CONSIDERATION OF SUCH BUSINESS. UPON COMPLIANCE 1,208
28
WITH THIS DIVISION, THE MEETING SHALL BE CALLED BY THE BOARD. 1,209
(D) NOTICE OF EVERY MEETING, TOGETHER WITH A STATEMENT OF 1,211
THE PURPOSE OF THE MEETING, SHALL BE SENT TO EACH MEMBER WHO IS 1,212
ENTITLED TO VOTE AT THE MEETING AND ANY AFFECTED STOCKHOLDER AT 1,214
THE MEMBER'S OR STOCKHOLDER'S CURRENT ADDRESS, AS SHOWN IN THE 1,215
RECORDS OF THE ASSOCIATION, AT LEAST TEN DAYS PRIOR TO THE 1,216
MEETING, IN ACCORDANCE WITH SECTION 1729.20 OF THE REVISED CODE. 1,217
THE BYLAWS MAY PROVIDE THAT THE NOTICE BE GIVEN BY PUBLICATION IN 1,218
A NEWSPAPER OR NEWSPAPERS OF GENERAL CIRCULATION IN THE TRADE 1,220
AREA OF THE ASSOCIATION IF NOTICE TO INDIVIDUAL MEMBERS AND
AFFECTED SHAREHOLDERS IS IMPRACTICABLE. 1,221
Sec. 1729.19. (A) UNLESS PROHIBITED IN AN ASSOCIATION'S 1,223
ARTICLES OF INCORPORATION OR BYLAWS, ANY ACTION THAT MAY BE 1,224
AUTHORIZED OR TAKEN AT A MEETING OF THE MEMBERS, AFFECTED 1,225
STOCKHOLDERS, THE BOARD, OR ANY COMMITTEE OF THE BOARD, MAY BE 1,226
AUTHORIZED OR TAKEN WITHOUT A MEETING, WITH THE AFFIRMATIVE VOTE 1,227
OR APPROVAL OF, AND IN WRITING OR WRITINGS SIGNED BY: 1,228
(1) IN THE CASE OF MEMBERS OR AFFECTED STOCKHOLDERS, SIXTY 1,230
PER CENT OF THE VOTES OF THE MEMBERS OR STOCKHOLDERS WHO WOULD BE 1,231
ENTITLED TO VOTE ON THE ACTION AT A MEETING FOR SUCH PURPOSE; 1,232
(2) IN THE CASE OF THE BOARD OF DIRECTORS OR A COMMITTEE 1,234
OF THE BOARD, ALL OF THE DIRECTORS ON THE BOARD OR ALL OF THE 1,235
COMMITTEE MEMBERS ON THE COMMITTEE. 1,236
(B) ANY SUCH WRITING OR WRITINGS SHALL BE INCLUDED IN THE 1,238
RECORDS OF THE ASSOCIATION IN THE SAME MANNER AS MINUTES OF 1,239
MEETINGS OF THE ASSOCIATION'S MEMBERS, AFFECTED STOCKHOLDERS, 1,240
BOARD, OR COMMITTEE OF THE BOARD. 1,241
(C) ANY CERTIFICATE WITH RESPECT TO THE AUTHORIZATION OR 1,243
TAKING OF ANY ACTION THAT IS REQUIRED TO BE FILED IN THE OFFICE 1,244
OF THE SECRETARY OF STATE SHALL STATE THAT THE AUTHORIZATION OR 1,245
TAKING OF SUCH ACTION WAS IN WRITING OR WRITINGS APPROVED AND 1,246
SIGNED AS PROVIDED IN THIS SECTION.
Sec. 1729.20. (A) WHENEVER NOTICE IS REQUIRED BY THIS 1,248
CHAPTER TO BE GIVEN TO ANY PERSON, THE NOTICE MAY BE GIVEN 1,249
29
PERSONALLY, BY MAIL, OR BY ELECTRONIC OR TELEPHONIC TRANSMITTAL. 1,250
IF MAILED, THE NOTICE IS GIVEN WHEN IT IS DEPOSITED IN THE UNITED 1,251
STATES MAIL, WITH POSTAGE PREPAID, ADDRESSED TO THE PERSON AT THE 1,253
PERSON'S ADDRESS AS IT APPEARS ON THE RECORDS OF THE ASSOCIATION. 1,254
IF NOTICE IS SENT BY ELECTRONIC OR TELEPHONIC TRANSMITTAL, NOTICE 1,255
IS GIVEN WHEN AN ELECTRONIC OR TELEPHONIC CONFIRMATION OF 1,256
DELIVERY IS RECEIVED BY THE ASSOCIATION.
(B) A SIGNED WAIVER IS EQUIVALENT TO PERSONAL NOTICE TO 1,258
THE PERSON SIGNING. THE WAIVER MAY BE SIGNED AT ANY TIME. 1,259
Sec. 1729.22. (A) EXCEPT WHERE THIS CHAPTER OR AN 1,261
ASSOCIATION'S ARTICLES OF INCORPORATION OR BYLAWS REQUIRE THAT 1,262
ACTION BE OTHERWISE AUTHORIZED OR TAKEN, ALL OF THE AUTHORITY OF 1,263
AN ASSOCIATION SHALL BE EXERCISED BY OR UNDER THE DIRECTION OF 1,264
THE BOARD. THE BOARD SHALL CONSIST OF NOT LESS THAN FIVE 1,265
DIRECTORS, ELECTED BY AND FROM THE MEMBERS, UNLESS THE NUMBER OF 1,266
MEMBERS IS LESS THAN FIVE, IN WHICH CASE, THE NUMBER OF DIRECTORS
MAY EQUAL THE NUMBER OF MEMBERS. 1,267
(B) THE BYLAWS MAY PROVIDE THAT THE MEMBERSHIP OF AN 1,269
ASSOCIATION BE DIVIDED INTO DISTRICTS OR OTHER GROUPINGS AND THAT 1,270
THE DIRECTORS SHALL BE ELECTED ACCORDING TO SUCH DISTRICTS OR 1,271
GROUPINGS. IN SUCH CASE, THE BYLAWS SHALL SPECIFY THE NUMBER OF 1,272
DIRECTORS TO BE ELECTED AND THE MANNER OF REAPPORTIONING OR 1,273
REDISTRICTING THE MEMBERSHIP.
(C) THE BYLAWS MAY PROVIDE THAT ONE OR MORE DIRECTORS MAY 1,275
BE APPOINTED BY THE OTHER DIRECTORS. THE APPOINTED DIRECTORS 1,276
NEED NOT BE MEMBERS OF THE ASSOCIATION, BUT SHALL HAVE THE SAME 1,277
POWERS, RIGHTS, AND RESPONSIBILITIES AS OTHER DIRECTORS. THE 1,278
APPOINTED DIRECTORS SHALL NOT NUMBER MORE THAN ONE-FIFTH OF THE 1,279
ENTIRE NUMBER OF DIRECTORS.
(D) THE BYLAWS MAY PROVIDE FOR AN EXECUTIVE COMMITTEE AND 1,281
MAY ALLOT TO THE COMMITTEE ANY OF THE FUNCTIONS AND POWERS OF THE 1,282
BOARD, SUBJECT TO THE GENERAL DIRECTION AND CONTROL OF THE BOARD. 1,284
(E) THE ASSOCIATION MAY PROVIDE A FAIR REMUNERATION FOR 1,286
THE TIME ACTUALLY SPENT BY ITS OFFICERS AND DIRECTORS IN ITS 1,287
30
SERVICE, AND FOR THE SERVICES OF THE MEMBERS OF ITS EXECUTIVE 1,288
COMMITTEE.
(F) WHEN A VACANCY ON THE BOARD OCCURS OTHER THAN BY 1,290
EXPIRATION OF TERM, THE REMAINING DIRECTORS ON THE BOARD, BY A 1,291
MAJORITY VOTE, SHALL ELECT A DIRECTOR TO FILL THE VACANCY. IF 1,293
THE BYLAWS PROVIDE FOR AN ELECTION OF DIRECTORS BY DISTRICT OR 1,294
OTHER GROUPING, THE BOARD MAY CALL A SPECIAL MEETING OF THE 1,295
MEMBERS IN THAT DISTRICT OR GROUP TO FILL THE VACANCY.
Sec. 1729.23. (A) A DIRECTOR SHALL PERFORM THE DUTIES OF 1,298
A DIRECTOR, INCLUDING DUTIES AS A MEMBER OF ANY COMMITTEE OF THE
DIRECTORS UPON WHICH THE DIRECTOR SERVES, IN GOOD FAITH, IN A 1,299
MANNER THE DIRECTOR REASONABLY BELIEVES TO BE IN OR NOT OPPOSED 1,301
TO THE BEST INTERESTS OF THE ASSOCIATION, AND WITH THE CARE THAT 1,302
AN ORDINARILY PRUDENT PERSON IN A LIKE POSITION WOULD USE UNDER 1,303
SIMILAR CIRCUMSTANCES. IN PERFORMING THESE DUTIES, A DIRECTOR IS
ENTITLED TO RELY ON INFORMATION, OPINIONS, REPORTS, OR 1,304
STATEMENTS, INCLUDING FINANCIAL STATEMENTS AND OTHER FINANCIAL 1,305
DATA, THAT ARE PREPARED OR PRESENTED BY ANY OF THE FOLLOWING: 1,306
(1) ONE OR MORE DIRECTORS, OFFICERS, OR EMPLOYEES OF THE 1,308
ASSOCIATION WHOM THE DIRECTOR REASONABLY BELIEVES ARE RELIABLE 1,309
AND COMPETENT IN THE MATTERS PREPARED OR PRESENTED; 1,310
(2) COUNSEL, PUBLIC ACCOUNTANTS, OR OTHER PERSONS AS TO 1,312
MATTERS THAT THE DIRECTOR REASONABLY BELIEVES ARE WITHIN THE 1,313
PERSON'S PROFESSIONAL OR EXPERT COMPETENCE; 1,314
(3) A COMMITTEE OF THE DIRECTORS UPON WHICH THE DIRECTOR 1,316
DOES NOT SERVE, ESTABLISHED IN ACCORDANCE WITH THE ASSOCIATION'S 1,317
ARTICLES OF INCORPORATION OR BYLAWS, AS TO MATTERS WITHIN ITS 1,318
DESIGNATED AUTHORITY, PROVIDED THE DIRECTOR REASONABLY BELIEVES 1,319
THE COMMITTEE MERITS CONFIDENCE.
(B) FOR PURPOSES OF DIVISION (A) OF THIS SECTION: 1,321
(1) A DIRECTOR SHALL NOT BE FOUND TO HAVE FAILED TO 1,323
PERFORM THE DUTIES IN ACCORDANCE WITH DIVISION (A) OF THIS 1,324
SECTION, UNLESS IT IS PROVED, BY CLEAR AND CONVINCING EVIDENCE, 1,325
IN AN ACTION BROUGHT AGAINST THE DIRECTOR THAT THE DIRECTOR HAS 1,326
31
NOT ACTED IN GOOD FAITH, IN A MANNER REASONABLY BELIEVED TO BE IN 1,327
OR NOT OPPOSED TO THE BEST INTERESTS OF THE ASSOCIATION, OR WITH
THE CARE THAT AN ORDINARILY PRUDENT PERSON IN A LIKE POSITION 1,328
WOULD USE UNDER SIMILAR CIRCUMSTANCES. SUCH AN ACTION INCLUDES, 1,329
BUT IS NOT LIMITED TO, AN ACTION THAT INVOLVES OR AFFECTS ANY OF 1,330
THE FOLLOWING:
(a) A CHANGE OR POTENTIAL CHANGE IN CONTROL OF THE 1,332
ASSOCIATION;
(b) A TERMINATION OR POTENTIAL TERMINATION OF THE 1,334
DIRECTOR'S SERVICE TO THE ASSOCIATION AS A DIRECTOR; 1,335
(c) SERVICE IN ANY OTHER POSITION OR RELATIONSHIP WITH THE 1,337
ASSOCIATION. 1,338
(2) A DIRECTOR SHALL NOT BE CONSIDERED TO BE ACTING IN 1,340
GOOD FAITH IF THE DIRECTOR HAS KNOWLEDGE CONCERNING THE MATTER IN 1,341
QUESTION THAT WOULD CAUSE RELIANCE ON INFORMATION, OPINIONS, 1,342
REPORTS, OR STATEMENTS THAT ARE PREPARED OR PRESENTED BY THE 1,343
PERSONS DESCRIBED IN DIVISIONS (A)(1) TO (3) OF THIS SECTION TO 1,344
BE UNWARRANTED.
(3) THE PROVISIONS OF DIVISION (B) OF THIS SECTION DO NOT 1,346
LIMIT RELIEF AVAILABLE UNDER SECTION 1729.24 OF THE REVISED CODE. 1,347
(C)(1) SUBJECT TO DIVISIONS (C)(2) AND (3) OF THIS 1,349
SECTION, A DIRECTOR IS LIABLE IN DAMAGES FOR ANY ACT THAT THE 1,350
DIRECTOR TAKES OR FAILS TO TAKE AS DIRECTOR ONLY IF IT IS PROVED, 1,351
BY CLEAR AND CONVINCING EVIDENCE, IN AN ACTION BROUGHT AGAINST 1,352
THE DIRECTOR THAT THE ACT OR OMISSION OF THE DIRECTOR WAS ONE 1,353
UNDERTAKEN WITH A DELIBERATE INTENT TO CAUSE INJURY TO THE 1,354
ASSOCIATION OR WAS ONE UNDERTAKEN WITH A RECKLESS DISREGARD FOR 1,355
THE BEST INTERESTS OF THE ASSOCIATION. 1,356
(2) DIVISION (C)(1) OF THIS SECTION DOES NOT AFFECT THE 1,358
LIABILITY OF A DIRECTOR UNDER SECTION 1729.25 OF THE REVISED 1,359
CODE.
(3) SUBJECT TO DIVISION (C)(2) OF THIS SECTION, DIVISION 1,362
(C)(1) OF THIS SECTION DOES NOT APPLY IF, AND ONLY TO THE EXTENT
THAT, AT THE TIME OF AN ACT OR OMISSION OF THE DIRECTOR, THE 1,363
32
ASSOCIATION'S ARTICLES OF INCORPORATION OR BYLAWS STATE, BY 1,364
SPECIFIC REFERENCE TO DIVISION (C)(1) OF THIS SECTION, THAT ITS 1,365
PROVISIONS DO NOT APPLY TO THE ASSOCIATION. 1,366
(D) FOR PURPOSES OF THIS SECTION, IN DETERMINING WHAT IS 1,368
REASONABLY BELIEVED TO BE IN OR NOT OPPOSED TO THE BEST INTERESTS 1,369
OF THE ASSOCIATION, A DIRECTOR SHALL CONSIDER THE PURPOSES OF THE 1,370
ASSOCIATION AND MAY CONSIDER ANY OF THE FOLLOWING: 1,371
(1) THE INTERESTS OF THE EMPLOYEES, SUPPLIERS, CREDITORS, 1,373
AND CUSTOMERS OF THE ASSOCIATION; 1,374
(2) THE ECONOMY OF THIS STATE AND OF THE UNITED STATES; 1,376
(3) COMMUNITY AND SOCIETAL MATTERS; 1,378
(4) THE LONG-TERM AND SHORT-TERM BEST INTERESTS OF THE 1,380
ASSOCIATION, INCLUDING, BUT NOT LIMITED TO, THE POSSIBILITY THAT 1,381
THOSE INTERESTS MAY BE BEST SERVED BY THE CONTINUED INDEPENDENCE 1,382
OF THE ASSOCIATION.
(E) DIVISIONS (B) AND (C) OF THIS SECTION DO NOT AFFECT 1,385
THE DUTIES OF A DIRECTOR WHO ACTS IN ANY CAPACITY OTHER THAN AS A
DIRECTOR. 1,386
Sec. 1729.24. (A) UNLESS OTHERWISE PROVIDED IN AN 1,388
ASSOCIATION'S ARTICLES OF INCORPORATION OR BYLAWS: 1,389
(1) NO CONTRACT OR TRANSACTION BETWEEN AN ASSOCIATION AND 1,391
ONE OR MORE OF ITS DIRECTORS OR OFFICERS, OR BETWEEN THE 1,392
ASSOCIATION AND ANY OTHER PERSON IN WHICH ONE OR MORE OF THE 1,393
ASSOCIATION'S DIRECTORS OR OFFICERS, ARE DIRECTORS OR OFFICERS, 1,394
OR HAVE A FINANCIAL OR PERSONAL INTEREST, SHALL BE VOID OR
VOIDABLE SOLELY FOR THIS REASON, OR SOLELY BECAUSE THE DIRECTOR 1,395
OR OFFICER IS PRESENT AT OR PARTICIPATES IN THE MEETING OF THE 1,396
BOARD OR COMMITTEE THAT AUTHORIZES THE CONTRACT OR TRANSACTION, 1,397
OR SOLELY BECAUSE THE DIRECTOR'S OR OFFICER'S VOTES ARE COUNTED 1,398
FOR SUCH PURPOSE, IF ANY OF THE FOLLOWING APPLIES:
(a) THE MATERIAL FACTS AS TO THE RELATIONSHIP OR INTEREST 1,400
AND AS TO THE CONTRACT OR TRANSACTION ARE DISCLOSED OR ARE KNOWN 1,401
TO THE BOARD OR THE COMMITTEE, AND THE BOARD OR COMMITTEE, IN 1,402
GOOD FAITH AUTHORIZES THE CONTRACT OR TRANSACTION BY THE 1,403
33
AFFIRMATIVE VOTE OF A MAJORITY OF THE DISINTERESTED DIRECTORS, 1,404
EVEN THOUGH THE DISINTERESTED DIRECTORS CONSTITUTE LESS THAN A
QUORUM OF THE BOARD OR THE COMMITTEE; 1,405
(b) THE MATERIAL FACTS AS TO THE RELATIONSHIP OR INTEREST 1,407
AND AS TO THE CONTRACT OR TRANSACTION ARE DISCLOSED OR ARE KNOWN 1,408
TO THE MEMBERS ENTITLED TO VOTE ON THE CONTRACT OR TRANSACTION, 1,409
AND THE CONTRACT OR TRANSACTION IS SPECIFICALLY APPROVED AT A 1,410
MEETING OF THE MEMBERS;
(c) THE CONTRACT OR TRANSACTION IS FAIR AS TO THE 1,412
ASSOCIATION AT THE TIME IT IS AUTHORIZED OR APPROVED BY THE 1,413
BOARD, OR A COMMITTEE OF THE BOARD, OR THE MEMBERS. 1,414
(2) COMMON OR INTERESTED DIRECTORS MAY BE COUNTED IN 1,416
DETERMINING THE PRESENCE OF A QUORUM AT A MEETING OF THE BOARD, 1,417
OR OF A COMMITTEE THAT AUTHORIZES THE CONTRACT OR TRANSACTION. 1,418
(B) DIVISIONS (A)(1) AND (2) OF THIS SECTION DO NOT LIMIT 1,421
OR OTHERWISE AFFECT THE LIABILITY OF DIRECTORS UNDER SECTION
1729.25 OF THE REVISED CODE. 1,422
(C) FOR PURPOSES OF DIVISION (A) OF THIS SECTION, A 1,424
DIRECTOR IS NOT AN INTERESTED DIRECTOR SOLELY BECAUSE THE SUBJECT 1,425
OF A CONTRACT OR TRANSACTION MAY INVOLVE OR EFFECT A CHANGE IN 1,426
CONTROL OF THE ASSOCIATION OR CONTINUATION IN OFFICE AS A 1,427
DIRECTOR OF THE ASSOCIATION.
Sec. 1729.25. (A) THE MEMBERS, THE DIRECTORS, AND THE 1,429
OFFICERS OF AN ASSOCIATION SHALL NOT BE PERSONALLY LIABLE FOR ANY 1,430
OBLIGATION OF THE ASSOCIATION. 1,431
(B)(1) DIRECTORS WHO VOTE FOR OR ASSENT TO ANY OF THE 1,433
FOLLOWING ARE JOINTLY AND SEVERALLY LIABLE TO THE ASSOCIATION IN 1,434
ACCORDANCE WITH DIVISION (B)(2) OF THIS SECTION: 1,435
(a) A DISTRIBUTION OF ASSETS TO MEMBERS, STOCKHOLDERS, OR 1,437
PATRONS CONTRARY TO LAW, THE ASSOCIATION'S ARTICLES OF 1,438
INCORPORATION, OR BYLAWS;
(b) A DISTRIBUTION OF ASSETS TO PERSONS OTHER THAN 1,440
CREDITORS DURING THE WINDING UP OF THE AFFAIRS OF THE 1,441
ASSOCIATION, ON DISSOLUTION OR OTHERWISE, WITHOUT THE PAYMENT OF 1,442
34
ALL KNOWN OBLIGATIONS OF THE ASSOCIATION, OR WITHOUT MAKING 1,443
ADEQUATE PROVISION FOR THE PAYMENT OF THE OBLIGATIONS;
(c) THE MAKING OF LOANS, OTHER THAN IN THE USUAL CONDUCT 1,445
OF THE ASSOCIATION'S AFFAIRS OR IN ACCORDANCE WITH THE 1,446
ASSOCIATION'S ARTICLES OR BYLAWS, TO AN OFFICER, DIRECTOR, OR 1,447
MEMBER OF THE ASSOCIATION.
(2)(a) IN CASES UNDER DIVISION (B)(1)(a) OF THIS SECTION, 1,450
UP TO THE AMOUNT OF THE DISTRIBUTION IN EXCESS OF THE AMOUNT THAT 1,451
COULD HAVE BEEN DISTRIBUTED WITHOUT VIOLATION OF LAW, THE
ARTICLES OF INCORPORATION, OR BYLAWS, BUT NOT IN EXCESS OF THE 1,452
AMOUNT THAT WOULD INURE TO THE BENEFIT OF THE CREDITORS OF THE 1,453
ASSOCIATION IF IT WAS INSOLVENT AT THE TIME OF THE DISTRIBUTION 1,454
OR THERE WAS REASONABLE GROUND TO BELIEVE THAT BY SUCH VOTE OR 1,455
ASSENT IT WOULD BE RENDERED INSOLVENT, OR TO THE BENEFIT OF THE
MEMBERS OR STOCKHOLDERS OTHER THAN MEMBERS OR STOCKHOLDERS OF THE 1,456
CLASS IN RESPECT OF WHICH THE DISTRIBUTION WAS MADE; 1,457
(b) IN CASES UNDER DIVISION (B)(1)(b) OF THIS SECTION, TO 1,460
THE EXTENT THAT THE OBLIGATIONS, NOT OTHERWISE BARRED BY STATUTE, 1,461
ARE NOT PAID, OR FOR THE PAYMENT OF WHICH ADEQUATE PROVISION HAS
NOT BEEN MADE; 1,462
(c) IN CASES UNDER DIVISION (B)(1)(c) OF THIS SECTION, FOR 1,465
THE AMOUNT OF THE LOAN WITH INTEREST THEREON AT THE RATE OF SIX 1,466
PER CENT PER YEAR UNTIL THE AMOUNT HAS BEEN PAID.
(3) A DIRECTOR IS NOT LIABLE UNDER DIVISION (B)(1)(a) OR 1,469
(b) OF THIS SECTION, IF IN DETERMINING THE AMOUNT AVAILABLE FOR 1,470
ANY SUCH DISTRIBUTION, THE DIRECTOR IN GOOD FAITH RELIED ON A 1,471
FINANCIAL STATEMENT OF THE ASSOCIATION PREPARED BY AN OFFICER OR 1,472
EMPLOYEE OF THE ASSOCIATION IN CHARGE OF ITS ACCOUNTS OR BY A 1,473
CERTIFIED PUBLIC ACCOUNTANT OR FIRM OF CERTIFIED PUBLIC
ACCOUNTANTS, OR IN GOOD FAITH CONSIDERED THE ASSETS TO BE OF 1,475
THEIR BOOK VALUE, OR FOLLOWED WHAT THE DIRECTOR BELIEVED TO BE 1,476
SOUND ACCOUNTING AND BUSINESS PRACTICE.
(C) A DIRECTOR WHO IS PRESENT AT A MEETING OF THE BOARD OR 1,478
A COMMITTEE OF THE BOARD AT WHICH ACTION ON ANY MATTER IS 1,479
35
AUTHORIZED OR TAKEN AND WHO HAS NOT VOTED FOR OR AGAINST SUCH 1,480
ACTION SHALL BE PRESUMED TO HAVE VOTED FOR THE ACTION UNLESS THE 1,481
DIRECTOR DISSENTS FROM THE ACTION DURING THE MEETING AND THE 1,482
DISSENT IS NOTED IN THE MINUTES OF THE PROCEEDINGS OF THE 1,483
MEETING, OR A WRITTEN DISSENT IS FILED EITHER DURING THE MEETING 1,485
OR WITHIN A REASONABLE TIME AFTER THE ADJOURNMENT OF THE MEETING. 1,486
(D) A MEMBER, STOCKHOLDER, OR PATRON WHO RECEIVES ANY 1,488
DISTRIBUTION MADE CONTRARY TO LAW, THE ASSOCIATION'S ARTICLES OF 1,489
INCORPORATION, OR BYLAWS IS LIABLE TO THE ASSOCIATION FOR THE 1,490
AMOUNT RECEIVED THAT IS IN EXCESS OF THE AMOUNT THAT COULD HAVE 1,491
BEEN DISTRIBUTED.
(E) A DIRECTOR AGAINST WHOM A CLAIM IS ASSERTED UNDER OR 1,493
PURSUANT TO THIS SECTION AND WHO IS HELD LIABLE ON THE CLAIM IS 1,494
ENTITLED TO CONTRIBUTION, ON EQUITABLE PRINCIPLES, FROM OTHER 1,495
DIRECTORS WHO ALSO ARE LIABLE. IN ADDITION, ANY DIRECTOR AGAINST 1,496
WHOM A CLAIM IS ASSERTED UNDER OR PURSUANT TO THIS SECTION, OR 1,497
WHO IS HELD LIABLE, HAS A RIGHT OF CONTRIBUTION FROM THE MEMBER, 1,498
STOCKHOLDER, OR PATRON WHO RECEIVED ANY DISTRIBUTION MADE
CONTRARY TO LAW, THE ARTICLES OF INCORPORATION, OR BYLAWS, AND 1,499
SUCH PERSONS AS AMONG THEMSELVES ALSO ARE ENTITLED TO 1,500
CONTRIBUTION IN PROPORTION TO THE AMOUNTS RECEIVED BY THEM 1,501
RESPECTIVELY.
(F) NO ACTION SHALL BE BROUGHT BY OR ON BEHALF OF AN 1,503
ASSOCIATION, UPON ANY CAUSE OF ACTION ARISING UNDER DIVISION 1,505
(B)(1)(a) OR (b) OF THIS SECTION, AT ANY TIME AFTER TWO YEARS 1,506
FROM THE DAY ON WHICH THE VIOLATION OCCURS; PROVIDED THAT NO SUCH 1,507
ACTION IS BARRED BY THIS DIVISION IF IT IS COMMENCED PRIOR TO THE
EFFECTIVE DATE OF THIS SECTION. 1,508
Sec. 1729.26. (A) THE OFFICERS OF AN ASSOCIATION SHALL 1,510
CONSIST OF A PRESIDENT, A SECRETARY, A TREASURER, AND, IF 1,511
DESIRED, A CHAIRPERSON OF THE BOARD, ONE OR MORE VICE-PRESIDENTS, 1,512
AND SUCH OTHER OFFICERS AND ASSISTANT OFFICERS AS NECESSARY. THE 1,513
OFFICERS SHALL BE ELECTED BY THE BOARD. THE CHAIRPERSON OF THE 1,514
BOARD SHALL BE A DIRECTOR. UNLESS THE ASSOCIATION'S ARTICLES OF 1,515
36
INCORPORATION OR BYLAWS PROVIDE OTHERWISE, NONE OF THE OTHER 1,516
OFFICERS NEED BE A DIRECTOR. ANY TWO OR MORE OFFICES MAY BE HELD 1,517
BY THE SAME PERSON, BUT NO OFFICER SHALL EXECUTE, ACKNOWLEDGE, OR 1,518
VERIFY ANY INSTRUMENT IN MORE THAN ONE CAPACITY IF THE INSTRUMENT 1,519
IS REQUIRED BY LAW OR BY THE ARTICLES OR BYLAWS TO BE EXECUTED,
ACKNOWLEDGED, OR VERIFIED BY TWO OR MORE OFFICERS. UNLESS THE 1,520
ARTICLES OR THE BYLAWS PROVIDE OTHERWISE, ALL OFFICERS SHALL BE 1,521
ELECTED ANNUALLY.
(B) ALL OFFICERS SHALL HAVE THE AUTHORITY TO PERFORM, AND 1,523
SHALL PERFORM, THE DUTIES AS THE BYLAWS PROVIDE, OR AS THE BOARD 1,524
MAY DETERMINE IN ACCORDANCE WITH THE BYLAWS. 1,525
Sec. 1729.15 1729.27. Every IF REQUIRED BY THE 1,534
ASSOCIATION'S BYLAWS, EVERY officer, employee, and agent handling 1,535
funds, negotiable instruments, or other property of or for an 1,537
association shall execute and deliver adequate bonds for the 1,538
faithful performance of his THE OFFICER'S, EMPLOYEE'S, OR AGENT'S 1,539
duties and obligations.
Sec. 1729.16 1729.28. (A) Any member of an association 1,549
may bring charges against an officer or director of the 1,551
association by filing them in writing with the secretary of the 1,552
association, together with a petition, signed by five TWENTY per 1,553
cent of the members, requesting the removal of the officer or 1,554
director in question. The removal shall be voted upon at the 1,555
next regular or special meeting of the association and, by a vote 1,556
of a majority of the members, the association may remove the 1,557
officer or director and fill the vacancy. The director or 1,558
officer against whom such charges are brought shall be informed
in writing of the charges previous to the meeting and shall have 1,559
an opportunity at the meeting to be heard in person or by counsel 1,560
and to present witnesses, and the persons bringing the charges 1,561
against him THE DIRECTOR OR OFFICER shall have the same 1,562
opportunity.
(B) In case the bylaws provide for election of directors 1,564
by districts with primary elections in each district OR OTHER 1,566
37
GROUPING, then the petition for removal of a director must be 1,568
signed by twenty per cent of the members residing in the district
OR BELONGING TO THE GROUP from which he THE DIRECTOR was elected. 1,571
The board of directors shall then call a special meeting of the 1,573
members residing in that district OR BELONGING TO THE GROUP to 1,574
consider AND VOTE UPON the removal of the director; and at such 1,575
meeting, by a vote of the majority of the members of that 1,576
district OR BELONGING TO THE GROUP, the director in question 1,577
shall be removed from office. 1,578
Sec. 1729.29. (A) AN ASSOCIATION SHALL KEEP CORRECT AND 1,580
COMPLETE BOOKS AND RECORDS OF ACCOUNT, AND SHALL ALSO KEEP 1,581
MINUTES OF THE PROCEEDINGS OF MEETINGS OF ITS MEMBERS, BOARD, AND 1,582
DELEGATES. THE ASSOCIATION SHALL KEEP AT ITS PRINCIPAL OFFICE 1,583
RECORDS OF THE NAMES AND ADDRESSES OF ALL MEMBERS AND 1,584
STOCKHOLDERS WITH THE AMOUNT OF OWNERSHIP INTERESTS AND STOCK 1,585
HELD BY EACH.
(B) AT ANY REASONABLE TIME, ANY MEMBER, UPON WRITTEN 1,587
NOTICE THAT STATES A PROPER PURPOSE FOR AN EXAMINATION OF BOOKS 1,588
AND RECORDS AND THAT IS DELIVERED OR SENT TO THE ASSOCIATION AT 1,589
LEAST ONE WEEK IN ADVANCE, MAY EXAMINE THOSE BOOKS AND RECORDS 1,590
PERTINENT TO THE PURPOSE IN THE NOTICE. THE BOARD MAY DENY A 1,591
REQUEST OF A MEMBER TO EXAMINE THE BOOKS AND RECORDS IF THE
PURPOSE IS NOT PROPER BECAUSE THE PURPOSE IS NOT DIRECTLY RELATED 1,592
TO THE PERSON'S INTEREST AS A MEMBER AND IS CONTRARY TO THE BEST 1,593
INTERESTS OF THE ASSOCIATION.
(C) AT ANY REASONABLE TIME, A STOCKHOLDER WHO IS NOT A 1,595
MEMBER, UPON WRITTEN NOTICE THAT STATES A PROPER PURPOSE FOR AN 1,596
EXAMINATION OF BOOKS AND RECORDS AND THAT IS DELIVERED OR SENT TO 1,597
THE ASSOCIATION AT LEAST ONE WEEK IN ADVANCE, MAY EXAMINE THOSE 1,598
BOOKS AND RECORDS THAT ARE PERTINENT TO THE PURPOSE IN THE 1,599
NOTICE. THE BOARD MAY DENY A REQUEST OF A STOCKHOLDER TO EXAMINE 1,600
THE BOOKS AND RECORDS IF THE PURPOSE IS NOT PROPER BECAUSE THE
PURPOSE IS NOT DIRECTLY RELATED TO THE PERSON'S INTEREST AS A 1,601
STOCKHOLDER AND IS CONTRARY TO THE BEST INTEREST OF THE 1,602
38
ASSOCIATION.
Sec. 1729.35. (A) AN ASSOCIATION MAY MERGE OR CONSOLIDATE 1,604
WITH ONE OR MORE ASSOCIATIONS UNDER THIS CHAPTER. BEFORE AN 1,605
ASSOCIATION MAY MERGE OR CONSOLIDATE WITH ANY OTHER ASSOCIATION, 1,606
A WRITTEN AGREEMENT OF MERGER OR CONSOLIDATION SHALL BE APPROVED 1,607
BY THE BOARD OF EACH CONSTITUENT ASSOCIATION AND BY THE MEMBERS 1,608
OF EACH CONSTITUENT ASSOCIATION. THE AGREEMENT SHALL SET FORTH 1,609
THE TERMS OF THE MERGER OR CONSOLIDATION, INCLUDING ANY 1,610
PROVISIONS FOR AMENDMENT OR ABANDONMENT OF THE AGREEMENT. IN THE 1,611
CASE OF A CONSOLIDATION, THE AGREEMENT ALSO SHALL CONTAIN THE
ARTICLES OF INCORPORATION OF THE NEW ASSOCIATION. 1,612
(B)(1) IF THE AGREEMENT OF MERGER OR CONSOLIDATION 1,614
PROVIDES THAT A HOLDER OF STOCK OTHER THAN MEMBERSHIP STOCK OR 1,615
PATRONAGE STOCK IN A CONSTITUENT ASSOCIATION WILL BE AFFECTED, 1,616
ALL OF THE FOLLOWING APPLY:
(a) UNLESS THE BOARD OF THE CONSTITUENT ASSOCIATION 1,618
PROVIDES THAT DIVISION (B)(1)(b) OF THIS SECTION APPLIES, THE 1,619
AFFECTED STOCKHOLDER SHALL BE ENTITLED TO CAST ONE VOTE ON THE 1,620
AGREEMENT REGARDLESS OF THE PAR OR STATED VALUE, THE NUMBER OF 1,621
SHARES, OR THE NUMBER OF AFFECTED CLASSES OF THE STOCK HELD. 1,622
(b) THE BOARD OF A CONSTITUENT ASSOCIATION MAY PROVIDE 1,624
THAT A STOCKHOLDER OTHERWISE ENTITLED TO VOTE UNDER DIVISION 1,626
(B)(1)(a) OF THIS SECTION SHALL INSTEAD BE ENTITLED TO PAYMENT OF 1,627
FAIR CASH VALUE OF THE AFFECTED STOCK HELD BY THE STOCKHOLDER IN
ACCORDANCE WITH SECTION 1729.46 OF THE REVISED CODE. 1,628
(c) A MEMBER HOLDING STOCK AFFECTED BY A PROPOSED 1,630
AGREEMENT OF MERGER OR CONSOLIDATION MAY VOTE ONLY AS A MEMBER 1,631
AND SHALL NOT BE ENTITLED TO VOTE OR DEMAND FAIR CASH VALUE AS AN 1,632
AFFECTED STOCKHOLDER.
(2) FOR PURPOSES OF THIS SECTION, A HOLDER OF STOCK IS 1,634
AFFECTED AS TO ANY CLASS OF STOCK OWNED BY THE HOLDER ONLY IF THE 1,635
AGREEMENT OF MERGER OR CONSOLIDATION DOES ANY OF THE FOLLOWING: 1,636
(a) DECREASES THE DIVIDENDS TO WHICH THAT CLASS MAY BE 1,638
ENTITLED OR CHANGES THE METHOD BY WHICH THE DIVIDEND RATE ON THAT 1,639
39
CLASS IS FIXED;
(b) PROVIDES FOR ADDITIONAL RESTRICTION OF RIGHTS TO 1,641
TRANSFER SHARES OF THAT CLASS; 1,642
(c) GIVES TO ANOTHER EXISTING OR ANY NEW CLASS OF STOCK OR 1,644
EQUITY INTEREST NOT PREVIOUSLY ENTITLED THERETO ANY PREFERENCE, 1,645
AS TO DIVIDENDS OR UPON DISSOLUTION, THAT IS HIGHER THAN 1,646
PREFERENCES OF THAT CLASS;
(d) CHANGES THE PAR VALUE OF SHARES OF THAT CLASS OR OF 1,648
ANY OTHER CLASS HAVING THE SAME OR HIGHER PREFERENCES AS TO 1,649
DIVIDENDS OR UPON DISSOLUTION; 1,650
(e) INCREASES THE NUMBER OF AUTHORIZED SHARES OF ANY OTHER 1,652
CLASS HAVING THE SAME OR HIGHER PREFERENCES AS TO DIVIDENDS OR 1,653
UPON DISSOLUTION BEYOND THE AGGREGATE AUTHORIZATIONS FOR SUCH 1,654
CLASSES IN THE CONSTITUENT ASSOCIATIONS; 1,655
(f) REQUIRES OR PERMITS AN EXCHANGE OF SHARES OF ANY CLASS 1,657
WITH LOWER PREFERENCES AS TO DIVIDENDS OR UPON DISSOLUTION FOR 1,658
SHARES OF ANY OTHER CLASS WITH HIGHER PREFERENCES. 1,659
(C) THE AGREEMENT IS APPROVED IF BOTH OF THE FOLLOWING 1,661
CONDITIONS ARE MET WITH RESPECT TO EACH CONSTITUENT ASSOCIATION: 1,662
(1) NOTICE OF THE MEETING TO VOTE ON THE AGREEMENT, THE 1,664
AGREEMENT, AND A DESCRIPTION OF THE METHOD OF VOTING HAVE BEEN 1,665
SENT TO ALL MEMBERS, AND TO ALL AFFECTED STOCKHOLDERS ENTITLED 1,666
EITHER TO VOTE ON THE AGREEMENT OR TO RECEIVE PAYMENT OF FAIR 1,667
CASH VALUE UNDER DIVISION (B) OF THIS SECTION; 1,668
(2) SIXTY PER CENT OF THE MEMBER VOTES CAST APPROVE THE 1,670
AGREEMENT, AND A SIMPLE MAJORITY OF THE VOTES CAST BY THE 1,671
AFFECTED STOCKHOLDERS ENTITLED TO VOTE UNDER DIVISION (B) OF THIS 1,673
SECTION APPROVE THE AGREEMENT.
(D) NOTWITHSTANDING DIVISION (C) OF THIS SECTION, NO VOTE 1,676
OF THE MEMBERS OR STOCKHOLDERS OF A CONSTITUENT ASSOCIATION SHALL
BE NECESSARY TO APPROVE A MERGER OF A WHOLLY OWNED SUBSIDIARY 1,677
ASSOCIATION WITH AND INTO ITS PARENT ASSOCIATION OR A MERGER OR A 1,678
CONSOLIDATION OF TWO OR MORE SUBSIDIARY ASSOCIATIONS THAT ARE 1,679
WHOLLY OWNED BY AN ASSOCIATION.
40
(E) AFTER APPROVAL OF AN AGREEMENT UNDER THIS SECTION, BUT 1,681
BEFORE THE MERGER OR CONSOLIDATION IS EFFECTIVE, THE AGREEMENT 1,682
MAY BE AMENDED IN ACCORDANCE WITH ANY PROVISION FOR AMENDMENT SET 1,683
FORTH IN THE AGREEMENT, PROVIDED THAT AN AMENDMENT MADE 1,684
SUBSEQUENT TO ADOPTION OF THE AGREEMENT BY THE MEMBERS OF ANY 1,685
CONSTITUENT ASSOCIATION SHALL NOT DO ANY OF THE FOLLOWING:
(1) CHANGE THE MEMBERSHIP RIGHTS, OR THE AMOUNT OR KIND OF 1,687
STOCK, SECURITIES, CASH, PROPERTY, OR OTHER RIGHTS TO BE 1,688
RECEIVED, EXCHANGED, OR CONVERTED IN THE MERGER OR CONSOLIDATION; 1,689
(2) CHANGE THE ARTICLES OF INCORPORATION OR BYLAWS OF THE 1,691
SURVIVING OR NEW ASSOCIATION AS PROVIDED FOR IN THE AGREEMENT; 1,692
(3) CHANGE ANY PROVISION OF THE AGREEMENT WITH RESPECT TO 1,694
THE RIGHTS OF MEMBERS OR THE MANNER OF VOTING IN THE SURVIVING OR 1,695
NEW ASSOCIATION.
(F) AFTER APPROVAL OF AN AGREEMENT UNDER THIS SECTION, BUT 1,697
BEFORE THE MERGER OR CONSOLIDATION IS EFFECTIVE, THE MERGER OR 1,698
CONSOLIDATION MAY BE ABANDONED IN ACCORDANCE WITH ANY PROVISION 1,699
FOR ABANDONMENT SET FORTH IN THE AGREEMENT. 1,700
(G) THE MERGER OR CONSOLIDATION SHALL TAKE EFFECT IN 1,702
ACCORDANCE WITH SECTIONS 1729.37 AND 1729.38 OF THE REVISED CODE. 1,703
Sec. 1729.36. (A) AN ASSOCIATION MAY MERGE OR CONSOLIDATE 1,705
WITH ONE OR MORE ENTITIES, IF SUCH MERGER OR CONSOLIDATION IS 1,706
PERMITTED BY THE LAWS UNDER WHICH EACH CONSTITUENT ENTITY EXISTS 1,707
AND THE ASSOCIATION COMPLIES WITH THIS SECTION. 1,708
(B) EACH CONSTITUENT ASSOCIATION SHALL COMPLY WITH SECTION 1,710
1729.35 OF THE REVISED CODE WITH RESPECT TO FORM AND APPROVAL OF 1,711
AN AGREEMENT OF MERGER OR CONSOLIDATION, AND EACH CONSTITUENT 1,712
ENTITY SHALL COMPLY WITH THE APPLICABLE PROVISIONS OF THE LAWS 1,713
UNDER WHICH IT EXISTS, EXCEPT THAT THE AGREEMENT OF MERGER OR 1,714
CONSOLIDATION, BY WHATEVER NAME DESIGNATED, SHALL COMPLY WITH
DIVISIONS (C) AND (D) OF THIS SECTION. 1,715
(C) THE AGREEMENT OF MERGER OR CONSOLIDATION SHALL SET 1,717
FORTH ALL OF THE FOLLOWING: 1,718
(1) THE NAMES OF THE STATES AND THE LAWS UNDER WHICH EACH 1,720
41
CONSTITUENT ENTITY EXISTS; 1,721
(2) ALL STATEMENTS AND MATTERS REQUIRED TO BE SET FORTH IN 1,723
AGREEMENTS OF MERGER OR CONSOLIDATION BY THE LAWS UNDER WHICH ANY 1,724
CONSTITUENT ENTITY EXISTS;
(3) A STATEMENT THAT THE SURVIVING OR NEW ENTITY IS TO BE 1,726
AN ASSOCIATION, CORPORATION, OR LIMITED LIABILITY COMPANY; 1,727
(4) IF THE SURVIVING OR NEW ENTITY IS TO BE A FOREIGN 1,729
ENTITY:
(a) THE PLACE WHERE THE PRINCIPAL OFFICE OF THE SURVIVING 1,731
OR NEW ENTITY IS TO BE LOCATED IN THE STATE IN WHICH THE 1,732
SURVIVING OR NEW ENTITY IS TO EXIST; 1,733
(b) THE CONSENT BY THE SURVIVING OR NEW ENTITY THAT IT MAY 1,735
BE SUED AND SERVED WITH PROCESS IN THIS STATE IN ANY PROCEEDING 1,737
FOR THE ENFORCEMENT OF ANY OBLIGATION OF ANY CONSTITUENT 1,738
ASSOCIATION OR DOMESTIC ENTITY;
(c) THE CONSENT BY THE SURVIVING OR NEW ENTITY THAT IT 1,740
SHALL BE SUBJECT TO THE APPLICABLE PROVISIONS OF CHAPTER 1703. OF 1,742
THE REVISED CODE, IF IT IS A FOREIGN CORPORATION OR FOREIGN 1,745
ASSOCIATION, OR TO SECTIONS 1705.53 TO 1705.58 OF THE REVISED 1,747
CODE, IF IT IS A FOREIGN LIMITED LIABILITY COMPANY; 1,748
(d) IF IT IS DESIRED THAT THE SURVIVING OR NEW ENTITY 1,750
EXERCISE ITS CORPORATE PRIVILEGES IN THIS STATE AS A FOREIGN 1,751
ENTITY. 1,752
(D) THE AGREEMENT MAY ALSO SET FORTH OTHER PROVISIONS 1,754
PERMITTED BY THE LAWS OF ANY STATE IN WHICH ANY CONSTITUENT 1,755
ENTITY EXISTS.
(E) IF THE SURVIVING OR NEW ENTITY IS AN ASSOCIATION, THE 1,757
MERGER OR CONSOLIDATION SHALL TAKE EFFECT IN ACCORDANCE WITH 1,758
SECTIONS 1729.37 AND 1729.38 OF THE REVISED CODE. 1,759
(F) IF THE SURVIVING OR NEW ENTITY IS AN ENTITY OTHER THAN 1,761
AN ASSOCIATION, THE MERGER OR CONSOLIDATION SHALL TAKE EFFECT IN 1,762
ACCORDANCE WITH THE APPLICABLE PROVISIONS OF THE LAWS UNDER WHICH 1,763
IT EXISTS.
Sec. 1729.37. (A) UNLESS A LATER DATE IS SPECIFIED IN THE 1,765
42
AGREEMENT, A MERGER OR CONSOLIDATION UNDER SECTIONS 1729.35 AND 1,767
1729.36 OF THE REVISED CODE IS EFFECTIVE WHEN THE CERTIFICATE OF 1,768
MERGER OR CONSOLIDATION IS FILED IN ACCORDANCE WITH SECTION 1,769
1729.38 OF THE REVISED CODE. IF, AFTER FILING THE CERTIFICATE
BUT BEFORE THE MERGER OR CONSOLIDATION IS EFFECTIVE, THE MERGER 1,770
OR CONSOLIDATION IS AMENDED OR ABANDONED, AS PROVIDED IN 1,771
DIVISIONS (E) AND (F) OF SECTION 1729.35 OF THE REVISED CODE, AN 1,772
AUTHORIZED OFFICER OF EACH CONSTITUENT ASSOCIATION SHALL SIGN A 1,773
CERTIFICATE OF AMENDMENT OR ABANDONMENT STATING THAT THE 1,774
AGREEMENT OF MERGER OR CONSOLIDATION HAS BEEN AMENDED OR 1,775
ABANDONED AND THE DATE OF SUCH ACTION, AND SHALL FILE THE 1,776
CERTIFICATE IN THE SAME MANNER AS THE CERTIFICATE OF MERGER OR 1,777
CONSOLIDATION. ANY CERTIFICATE OF AMENDMENT OR ABANDONMENT SHALL
BE FILED PRIOR TO THE DATE THE MERGER OR CONSOLIDATION WOULD 1,778
OTHERWISE BE EFFECTIVE.
(B) IN THE CASE OF A MERGER, THE SURVIVING ASSOCIATION OR 1,780
ENTITY IS THE ONE DESIGNATED IN THE AGREEMENT. IN THE CASE OF A 1,781
CONSOLIDATION, THE NEW ASSOCIATION OR ENTITY IS THE ONE 1,782
DESIGNATED IN THE AGREEMENT. THE SEPARATE EXISTENCE OF ALL 1,783
CONSTITUENT ASSOCIATIONS OR ENTITIES IN THE AGREEMENT, EXCEPT THE 1,784
SURVIVING OR NEW ASSOCIATION OR ENTITY, CEASES UPON THE EFFECTIVE 1,785
DATE OF THE MERGER OR CONSOLIDATION.
(C) THE SURVIVING OR NEW ASSOCIATION OR ENTITY POSSESSES 1,787
ALL THE RIGHTS AND ALL THE PROPERTY OF EACH CONSTITUENT 1,788
ASSOCIATION OR ENTITY, AND IS RESPONSIBLE FOR ALL THEIR 1,789
OBLIGATIONS. TITLE TO ANY PROPERTY IS VESTED IN THE SURVIVING OR 1,790
NEW ASSOCIATION OR ENTITY WITH NO REVERSION OR IMPAIRMENT OF THE
PROPERTY CAUSED BY THE MERGER OR CONSOLIDATION. A MERGER OR 1,791
CONSOLIDATION SHALL NOT BE CONSIDERED AN ASSIGNMENT. NO RIGHT OF 1,792
ANY CREDITOR SHALL BE IMPAIRED BY THE MERGER OR CONSOLIDATION 1,793
WITHOUT THE CREDITOR'S CONSENT.
(D) IF THE SURVIVING ORGANIZATION IS AN ASSOCIATION, THE 1,795
ARTICLES OF INCORPORATION ARE AMENDED TO THE EXTENT PROVIDED IN 1,796
THE AGREEMENT OF MERGER. 1,797
43
Sec. 1729.38. (A)(1) UPON ADOPTION OF AN AGREEMENT OF 1,799
MERGER OR CONSOLIDATION UNDER SECTION 1729.35 OR 1729.36 OF THE 1,800
REVISED CODE, A CERTIFICATE, SIGNED BY ANY AUTHORIZED OFFICER OF 1,801
EACH CONSTITUENT ASSOCIATION OR ENTITY, SHALL BE FILED WITH THE 1,803
SECRETARY OF STATE ON A FORM PRESCRIBED BY THE SECRETARY OF STATE 1,804
THAT SETS FORTH THE FOLLOWING: 1,805
(a) THE NAME AND FORM OF EACH CONSTITUENT ASSOCIATION OR 1,807
ENTITY AND THE STATE LAW UNDER WHICH EACH CONSTITUENT ENTITY 1,808
EXISTS;
(b) A STATEMENT THAT EACH CONSTITUENT ASSOCIATION OR 1,810
ENTITY HAS ADOPTED THE AGREEMENT OF MERGER OR CONSOLIDATION, THE 1,811
MANNER OF ADOPTION, AND THAT THE AGREEMENT WAS ADOPTED IN 1,812
COMPLIANCE WITH THE LAWS APPLICABLE TO EACH CONSTITUENT 1,813
ASSOCIATION OR ENTITY;
(c) THE EFFECTIVE DATE OF THE MERGER OR CONSOLIDATION, 1,815
WHICH DATE MAY BE ON OR AFTER THE DATE OF FILING OF THE 1,816
CERTIFICATE;
(d) IN THE CASE OF A MERGER, A STATEMENT THAT ONE OR MORE 1,818
SPECIFIED CONSTITUENT ASSOCIATIONS OR ENTITIES WILL BE MERGED 1,819
INTO A SPECIFIED SURVIVING ASSOCIATION OR ENTITY, OR, IN THE CASE 1,820
OF A CONSOLIDATION, A STATEMENT THAT THE CONSTITUENT ASSOCIATIONS 1,821
OR ENTITIES WILL BE CONSOLIDATED INTO A NEW ASSOCIATION OR 1,822
ENTITY;
(e) THE NAME AND ADDRESS OF THE STATUTORY AGENT UPON WHOM 1,824
ANY PROCESS, NOTICE, OR DEMAND AGAINST ANY CONSTITUENT 1,825
ASSOCIATION OR ENTITY, OR THE SURVIVING OR NEW ASSOCIATION OR 1,826
ENTITY MAY BE SERVED.
(2) IN THE CASE OF A MERGER INTO AN ASSOCIATION OR 1,828
DOMESTIC ENTITY, ANY AMENDMENTS TO THE ARTICLES OF INCORPORATION 1,829
OR THE ARTICLES OR ORGANIZATION OF THE SURVIVING ASSOCIATION OR 1,830
ENTITY SHALL BE FILED WITH THE CERTIFICATE.
(3) IN THE CASE OF A CONSOLIDATION TO FORM A NEW DOMESTIC 1,832
ASSOCIATION OR ENTITY, THE ARTICLES OF INCORPORATION OR THE 1,833
ARTICLES OF ORGANIZATION OF THE NEW ASSOCIATION OR ENTITY SHALL 1,834
44
BE FILED WITH THE CERTIFICATE.
(4) IF THE SURVIVING OR NEW ENTITY IS A FOREIGN ENTITY 1,836
THAT DESIRES TO TRANSACT BUSINESS IN THIS STATE AS A FOREIGN 1,837
ENTITY, THE CERTIFICATE SHALL BE ACCOMPANIED BY THE INFORMATION 1,838
REQUIRED FOR QUALIFICATION OF A FOREIGN ENTITY IN THIS STATE BY 1,839
CHAPTER 1703. OF THE REVISED CODE, IN THE CASE OF A FOREIGN
CORPORATION OR FOREIGN COOPERATIVE, OR BY SECTIONS 1705.53 AND 1,840
1705.54 OF THE REVISED CODE, IN THE CASE OF A FOREIGN LIMITED 1,841
LIABILITY COMPANY.
(B) A COPY OF THE CERTIFICATE OF MERGER OR CONSOLIDATION, 1,843
CERTIFIED BY THE SECRETARY OF STATE, MAY BE FILED FOR RECORD IN 1,844
THE OFFICE OF THE COUNTY RECORDER OF ANY COUNTY IN THIS STATE. 1,845
FOR SUCH RECORDING THE COUNTY RECORDER SHALL CHARGE AND COLLECT 1,846
THE SAME FEE AS IN THE CASE OF DEEDS. THE CERTIFIED COPY OF THE 1,847
CERTIFICATE OF MERGER OR CONSOLIDATION SHALL BE RECORDED IN THE 1,848
RECORDS OF DEEDS.
(C) FOR PURPOSES OF THIS SECTION, "DOMESTIC ENTITY" MEANS 1,851
A CORPORATION OR LIMITED LIABILITY COMPANY ORGANIZED UNDER THE 1,852
LAWS OF THIS STATE.
Sec. 1729.40. (A) ANY ASSOCIATION MAY DIVIDE ITSELF INTO 1,854
TWO OR MORE ASSOCIATIONS. A WRITTEN PLAN OF DIVISION SHALL BE 1,855
APPROVED BY THE ASSOCIATION'S BOARD. SUCH PLAN SHALL SET FORTH 1,856
ALL THE TERMS OF THE DIVISION AND THE PROPOSED EFFECT OF THE 1,857
DIVISION ON ALL MEMBERS AND STOCKHOLDERS OF THE ASSOCIATION. THE 1,858
PLAN ALSO SHALL CONTAIN THE ARTICLES OF INCORPORATION AND BYLAWS 1,859
OF EACH ASSOCIATION RESULTING FROM THE DIVISION, WHICH ARTICLES 1,860
AND BYLAWS SHALL CONFORM TO THE REQUIREMENTS FOR ASSOCIATIONS 1,861
ORGANIZED UNDER THIS CHAPTER. 1,862
(B)(1) IF THE PLAN OF DIVISION PROVIDES THAT A HOLDER OF 1,864
STOCK OTHER THAN MEMBERSHIP STOCK OR PATRONAGE STOCK WILL BE 1,865
AFFECTED, THE FOLLOWING APPLY: 1,866
(a) UNLESS THE BOARD PROVIDES THAT DIVISION (B)(1)(b) OF 1,869
THIS SECTION APPLIES, THE AFFECTED STOCKHOLDER SHALL BE ENTITLED 1,870
TO CAST ONE VOTE ON THE PLAN OF DIVISION REGARDLESS OF THE PAR OR 1,871
45
STATED VALUE, THE NUMBER OF SHARES, OR THE NUMBER OF AFFECTED 1,872
CLASSES OF THE STOCK HELD.
(b) THE BOARD MAY PROVIDE THAT A STOCKHOLDER OTHERWISE 1,874
ENTITLED TO VOTE UNDER DIVISION (B)(1)(a) OF THIS SECTION SHALL 1,876
INSTEAD BE ENTITLED TO PAYMENT OF FAIR CASH VALUE OF THE AFFECTED
STOCK HELD BY THE STOCKHOLDER IN ACCORDANCE WITH SECTION 1729.46 1,877
OF THE REVISED CODE.
(c) A MEMBER HOLDING STOCK AFFECTED BY A PROPOSED PLAN OF 1,879
DIVISION MAY VOTE ONLY AS A MEMBER AND SHALL NOT BE ENTITLED TO 1,880
VOTE OR DEMAND FAIR CASH VALUE AS AN AFFECTED STOCKHOLDER. 1,881
(2) FOR PURPOSES OF THIS SECTION, A HOLDER OF STOCK IS 1,883
AFFECTED AS TO ANY CLASS OF STOCK OWNED BY THE HOLDER ONLY IF THE 1,884
PLAN OF DIVISION DOES ANY OF THE FOLLOWING: 1,885
(a) DECREASES THE DIVIDENDS TO WHICH THAT CLASS MAY BE 1,887
ENTITLED OR CHANGES THE METHOD BY WHICH THE DIVIDEND RATE ON THAT 1,888
CLASS IS FIXED;
(b) PROVIDES ANY ADDITIONAL RESTRICTION ON RIGHTS TO 1,890
TRANSFER SHARES OF THAT CLASS; 1,891
(c) GIVES TO ANOTHER EXISTING OR ANY NEW CLASS OF STOCK OR 1,893
EQUITY INTEREST NOT PREVIOUSLY ENTITLED THERETO ANY PREFERENCE, 1,894
AS TO DIVIDENDS OR UPON DISSOLUTION, THAT IS HIGHER THAN 1,895
PREFERENCES OF THAT CLASS IN A RESULTING ASSOCIATION; 1,896
(d) CHANGES THE PAR VALUE OF SHARES OF THAT CLASS OR OF 1,898
ANY OTHER CLASS HAVING THE SAME OR HIGHER PREFERENCES AS TO 1,899
DIVIDENDS OR UPON DISSOLUTION; 1,900
(e) INCREASES THE AGGREGATE NUMBER OF AUTHORIZED SHARES OF 1,902
ANY OTHER CLASS HAVING THE SAME OR HIGHER PREFERENCES AS TO 1,903
DIVIDENDS OR UPON DISSOLUTION IN THE RESULTING ASSOCIATIONS 1,904
BEYOND THE AUTHORIZATION FOR SUCH CLASSES IN THE ORIGINAL 1,905
ASSOCIATION;
(f) REQUIRES OR PERMITS AN EXCHANGE OF SHARES OF ANY CLASS 1,907
WITH LOWER PREFERENCES AS TO DIVIDENDS OR UPON DISSOLUTION IN THE 1,908
ORIGINAL ASSOCIATION FOR SHARES OF ANY OTHER CLASS WITH HIGHER 1,910
PREFERENCES IN A RESULTING ASSOCIATION.
46
(C) THE PLAN OF DIVISION IS APPROVED IF BOTH OF THE 1,912
FOLLOWING CONDITIONS ARE MET: 1,913
(1) NOTICE OF THE MEETING TO VOTE ON THE PLAN, THE PLAN OF 1,915
DIVISION, AND A DESCRIPTION OF THE METHOD OF VOTING HAVE BEEN 1,916
SENT TO ALL MEMBERS AND TO ALL AFFECTED STOCKHOLDERS ENTITLED 1,917
EITHER TO VOTE ON THE PLAN OR TO RECEIVE PAYMENT OF FAIR CASH 1,918
VALUE UNDER DIVISION (B) OF THIS SECTION;
(2) SIXTY PER CENT OF THE MEMBER VOTES CAST APPROVE THE 1,920
PLAN, AND A SIMPLE MAJORITY OF THE VOTES CAST BY THE AFFECTED 1,921
STOCKHOLDERS ENTITLED TO VOTE UNDER DIVISION (B) OF THIS SECTION 1,922
APPROVE THE PLAN.
(D) AFTER APPROVAL OF A PLAN OF DIVISION UNDER THIS 1,924
SECTION, BUT BEFORE THE DIVISION IS EFFECTIVE, THE PLAN MAY BE 1,925
AMENDED OR ABANDONED IN ACCORDANCE WITH A PROVISION FOR AMENDMENT 1,926
OR ABANDONMENT SET FORTH IN THE PLAN, PROVIDED THAT AN AMENDMENT 1,927
MADE SUBSEQUENT TO APPROVAL OF THE PLAN BY THE MEMBERS SHALL NOT 1,928
DO ANY OF THE FOLLOWING:
(1) CHANGE THE MEMBERSHIP RIGHTS, OR THE AMOUNT OR KIND OF 1,930
STOCK, SECURITIES, CASH, PROPERTY, OR OTHER RIGHTS TO BE 1,931
RECEIVED, EXCHANGED, OR CONVERTED IN THE DIVISION; 1,932
(2) CHANGE THE ARTICLES OF INCORPORATION OR BYLAWS OF THE 1,934
RESULTING ASSOCIATIONS AS PROVIDED FOR IN THE PLAN; 1,935
(3) CHANGE ANY PROVISION OF THE PLAN WITH RESPECT TO THE 1,937
RIGHTS OF MEMBERS OR THE MANNER OF VOTING IN THE RESULTING 1,938
ASSOCIATIONS.
(E)(1) UPON APPROVAL OF A PLAN OF DIVISION, A CERTIFICATE, 1,940
SIGNED BY ANY AUTHORIZED OFFICER OF THE ORIGINAL ASSOCIATION, 1,941
SHALL BE FILED WITH THE SECRETARY OF STATE ON A FORM PRESCRIBED 1,942
BY THE SECRETARY OF STATE SETTING FORTH THE FOLLOWING: 1,943
(a) THE NAME OF THE ORIGINAL ASSOCIATION AND THE NAME OF 1,945
EACH RESULTING ASSOCIATION; 1,946
(b) A STATEMENT THAT THE ORIGINAL ASSOCIATION HAS ADOPTED 1,948
THE PLAN OF DIVISION, THE MANNER OF ADOPTION, AND THAT THE PLAN 1,949
WAS ADOPTED IN COMPLIANCE WITH THIS SECTION OF THE REVISED CODE; 1,950
47
(c) THE EFFECTIVE DATE OF THE DIVISION, WHICH DATE MAY BE 1,952
ON OR AFTER THE DATE OF FILING OF THE CERTIFICATE; 1,953
(d) A STATEMENT THAT THE ORIGINAL ASSOCIATION WILL BE 1,955
DIVIDED INTO SPECIFIED RESULTING ASSOCIATIONS; 1,956
(e) THE NAME AND ADDRESS OF THE STATUTORY AGENT UPON WHOM 1,958
ANY PROCESS, NOTICE, OR DEMAND AGAINST THE ORIGINAL ASSOCIATION 1,959
MAY BE SERVED, AND THE NAME AND ADDRESS OF A STATUTORY AGENT FOR 1,960
EACH RESULTING ASSOCIATION UPON WHOM PROCESS, NOTICE, OR DEMAND 1,961
AGAINST THAT RESULTING ASSOCIATION MAY BE SERVED. 1,962
(2) THE ARTICLES OF INCORPORATION OF EACH OF THE RESULTING 1,964
ASSOCIATIONS SHALL BE FILED WITH THE CERTIFICATE. 1,965
Sec. 1729.42. (A) A DOMESTIC CORPORATION MAY CONVERT 1,967
ITSELF INTO AN ASSOCIATION BY ADOPTING AN AMENDMENT TO ITS 1,968
ARTICLES OF INCORPORATION IN WHICH IT ELECTS TO BECOME SUBJECT TO 1,969
THIS CHAPTER, TOGETHER WITH ANY CHANGES IN ITS ARTICLES OF 1,970
INCORPORATION AND BYLAWS REQUIRED BY THIS CHAPTER, AND ANY OTHER 1,971
DESIRABLE CHANGES PERMITTED BY THIS CHAPTER. THE AMENDMENT SHALL
BE ADOPTED, FILED, AND RECORDED IN THE MANNER PROVIDED BY THE LAW 1,972
UNDER WHICH THE CORPORATION EXISTS. 1,973
(B) AN ASSOCIATION MAY CONVERT ITSELF TO A DOMESTIC 1,975
CORPORATION BY ADOPTING AN AMENDMENT TO ITS ARTICLES OF 1,976
INCORPORATION IN WHICH IT ELECTS TO BECOME SUBJECT TO ANY OTHER 1,977
CHAPTER OF TITLE XVII OF THE REVISED CODE, IF SO PERMITTED BY 1,979
SUCH CHAPTER, TOGETHER WITH ANY CHANGES IN ITS ARTICLES OF
INCORPORATION AND BYLAWS REQUIRED BY SUCH CHAPTER AND ANY OTHER 1,980
DESIRABLE CHANGES PERMITTED BY SUCH CHAPTER. THE AMENDMENT SHALL 1,981
BE ADOPTED, FILED, AND RECORDED UNDER THIS CHAPTER IN THE SAME 1,982
MANNER AS AN AMENDMENT OF THE ARTICLES OF INCORPORATION UNDER 1,983
SECTIONS 1729.08 AND 1729.09 OF THE REVISED CODE.
Sec. 1729.44. AN ACTION TO SET ASIDE A MERGER, 1,985
CONSOLIDATION, DIVISION, OR CONVERSION OF AN ASSOCIATION, ON THE 1,986
GROUND THAT ANY SECTION OF THE REVISED CODE HAS NOT BEEN COMPLIED 1,987
WITH, SHALL BE BROUGHT WITHIN NINETY DAYS AFTER THE EFFECTIVE
DATE OF THE MERGER, CONSOLIDATION, DIVISION, OR CONVERSION, OR 1,988
48
SUCH ACTION SHALL BE FOREVER BARRED. 1,989
Sec. 1729.46. (A) IN ORDER TO OBTAIN PAYMENT OF THE FAIR 1,991
CASH VALUE, A STOCKHOLDER ENTITLED TO PAYMENT OF THE FAIR CASH 1,992
VALUE OF STOCK UNDER SECTION 1729.09, 1729.35, 1729.36, 1729.40, 1,993
OR 1729.42 OF THE REVISED CODE SHALL DELIVER A WRITTEN DEMAND FOR 1,994
PAYMENT OF THE FAIR CASH VALUE OF THE STOCK TO THE ASSOCIATION NO 1,995
LATER THAN FIFTEEN DAYS AFTER NOTICE IS SENT TO MEMBERS AND 1,996
STOCKHOLDERS IN ACCORDANCE WITH SECTION 1729.09, 1729.35, 1,997
1729.36, 1729.40, OR 1729.42 OF THE REVISED CODE, AS THE CASE MAY 1,998
BE. THE WRITTEN DEMAND SHALL STATE THE NAME AND ADDRESS OF THE 1,999
STOCKHOLDER, THE NUMBER AND CLASS OF THE STOCK FOR WHICH FAIR 2,001
CASH VALUE IS DEMANDED, AND THE AMOUNT CLAIMED BY THE STOCKHOLDER 2,002
TO BE THE FAIR CASH VALUE OF THE STOCK. DELIVERY OF WRITTEN 2,003
DEMAND FOR PAYMENT OF FAIR CASH VALUE OF STOCK IN ACCORDANCE WITH 2,004
THIS SECTION IS SUFFICIENT IF DELIVERED TO THE ASSOCIATION OR TO 2,005
THE SURVIVING OR NEW ASSOCIATION OR ENTITY RESULTING FROM THE
MERGER, CONSOLIDATION, DIVISION, OR CONVERSION, WHETHER THE 2,006
DEMAND IS DELIVERED BEFORE, ON, OR AFTER THE EFFECTIVE DATE OF 2,008
THE ACTION. IF WRITTEN DEMAND IS NOT TIMELY DELIVERED IN 2,009
CONFORMITY WITH THIS SECTION, THE STOCKHOLDER'S RIGHT TO PAYMENT 2,010
OF FAIR CASH VALUE WITH RESPECT TO THE AMENDMENT TO THE ARTICLES 2,011
OF INCORPORATION, AGREEMENT OF MERGER OR CONSOLIDATION, PLAN OF 2,012
DIVISION, OR CONVERSION SHALL BE BARRED.
(B) IF A TIMELY DEMAND IS DELIVERED IN ACCORDANCE WITH 2,014
THIS SECTION, FAIR CASH VALUE OF THE STOCK SHALL BE DETERMINED 2,015
AND PAID TO THE STOCKHOLDER IN ACCORDANCE WITH THE FOLLOWING 2,016
PROCEDURES:
(1) THE ASSOCIATION OR THE SURVIVING, NEW, OR RESULTING 2,018
ASSOCIATION OR ENTITY SHALL SEND A WRITTEN ACKNOWLEDGMENT OF 2,020
RECEIPT OF THE DEMAND FOR FAIR CASH VALUE TO THE ADDRESS 2,021
SPECIFIED IN THE DEMAND NO LATER THAN FIFTEEN DAYS AFTER RECEIPT
OF THE DEMAND. IF THE BOARD OF THE ASSOCIATION OR THE SURVIVING, 2,022
NEW, OR RESULTING ASSOCIATION OR ENTITY BELIEVES THAT THE DEMAND 2,023
HAS FAILED TO COMPLY WITH THE REQUIREMENTS OF THIS SECTION, THE 2,025
49
ACKNOWLEDGMENT SHALL STATE ANY SUCH DEFECTS. THE ACKNOWLEDGMENT 2,026
ALSO SHALL STATE WHAT THE BOARD BELIEVES TO BE THE FAIR CASH 2,027
VALUE OF THE STOCK THAT IS THE SUBJECT OF THE DEMAND. IF THE 2,028
ARTICLES OF INCORPORATION OF THE CONSTITUENT OR ORIGINAL
ASSOCIATION PROVIDE A VALUE FOR THE STOCK UPON REDEMPTION, THE 2,030
FAIR CASH VALUE OF THE STOCK PRESUMPTIVELY SHALL BE THE LESSER OF 2,032
THE REDEMPTION VALUE OR THE FAIR MARKET VALUE OF SUCH STOCK
IMMEDIATELY PRIOR TO THE MERGER, CONSOLIDATION, DIVISION, OR 2,033
CONVERSION.
(2) THE STOCKHOLDER SHALL NOT TRANSFER, ENCUMBER, PLEDGE, 2,035
OR OTHERWISE DISPOSE OF THE STOCK THAT IS THE SUBJECT OF THE 2,036
DEMAND FOR FAIR CASH VALUE, OR ANY CERTIFICATE REPRESENTING SUCH 2,037
STOCK, UNTIL THE DEMAND IS FINALLY RESOLVED BY AGREEMENT, 2,038
WITHDRAWAL, OR FINAL JUDICIAL DETERMINATION AS PROVIDED IN THIS
SECTION. 2,039
(3) IF THE ASSOCIATION'S ARTICLES OF INCORPORATION OR 2,041
BYLAWS PROVIDE A REASONABLE BASIS FOR DETERMINING AND PAYING THE 2,042
FAIR CASH VALUE OF THE STOCK THAT IS THE SUBJECT OF THE DEMAND 2,043
FOR FAIR CASH VALUE, OR IF THE ASSOCIATION OR THE SURVIVING, NEW, 2,044
OR RESULTING ASSOCIATION OR ENTITY AND THE DEMANDING STOCKHOLDER 2,045
REACH AN AGREEMENT ON THE FAIR CASH VALUE OF THE STOCK WITHIN 2,046
THREE MONTHS AFTER DELIVERY OF THE DEMAND FOR FAIR CASH VALUE, 2,047
THE FAIR CASH VALUE OF THE STOCK SHALL BE DETERMINED IN 2,048
ACCORDANCE WITH THE CONSTITUENT OR ORIGINAL ASSOCIATION'S 2,049
ARTICLES OF INCORPORATION OR BYLAWS, OR AS AGREED UPON, AS THE 2,050
CASE MAY BE. THE ASSOCIATION SHALL THEREUPON TENDER PAYMENT OF 2,051
THE FAIR CASH VALUE SO DETERMINED, TO BE PAID TO THE STOCKHOLDER 2,052
WITHIN THIRTY DAYS OF DELIVERY OF ANY CERTIFICATES REPRESENTING 2,053
THE STOCK OR THE STOCKHOLDER'S WRITTEN WAIVER AND RELEASE OF 2,054
CLAIM TO ALL RIGHTS TO THE STOCK TO THE ASSOCIATION OR THE
SURVIVING, NEW, OR RESULTING ASSOCIATION OR ENTITY. WITHOUT 2,055
PRECLUDING OTHER POSSIBLE REASONABLE BASES FOR DETERMINING FAIR 2,057
CASH VALUE OF STOCK UNDER THIS SECTION, A PROVISION IN THE 2,058
CONSTITUENT OR ORIGINAL ASSOCIATION'S ARTICLES OF INCORPORATION
50
OR BYLAWS THAT FAIR CASH VALUE SHALL BE DETERMINED BY FINAL AND 2,060
BINDING ARBITRATION, OR THAT FAIR CASH VALUE SHALL BE THE LESSER 2,061
OF PAR VALUE, BOOK VALUE, OR FAIR MARKET VALUE, SHALL BE
CONSIDERED A REASONABLE BASIS FOR DETERMINING AND PAYING THE FAIR 2,062
CASH VALUE OF STOCK. 2,064
(C) THE RIGHT OF A DEMANDING STOCKHOLDER TO RECEIVE THE 2,066
FAIR CASH VALUE OF STOCK AS TO WHICH THE STOCKHOLDER SEEKS RELIEF 2,067
AND THE OBLIGATION OF THE ASSOCIATION OR THE SURVIVING, NEW, OR 2,068
RESULTING ASSOCIATION OR ENTITY TO FURNISH THE FAIR CASH VALUE 2,070
FOR THOSE INTERESTS TERMINATE IF ANY OF THE FOLLOWING APPLIES:
(1) THE DEMANDING STOCKHOLDER FAILS TO COMPLY WITH THIS 2,072
SECTION.
(2) THE ASSOCIATION ABANDONS THE AMENDMENT OF ARTICLES, 2,074
MERGER, CONSOLIDATION, DIVISION, OR CONVERSION OR IS FINALLY 2,075
ENJOINED OR PREVENTED FROM TAKING SUCH ACTION. 2,076
(3) THE DEMANDING STOCKHOLDER WITHDRAWS THE DEMAND FOR 2,078
FAIR CASH VALUE WITH CONSENT OF THE ASSOCIATION. 2,079
(4) THE DEMANDING STOCKHOLDER ATTEMPTS TO SELL, TRANSFER, 2,081
OR ENCUMBER THE STOCK WHICH IS THE SUBJECT OF THE DEMAND PRIOR TO 2,082
FINAL DETERMINATION OF ITS FAIR CASH VALUE UNDER THIS SECTION OR 2,083
UNDER SECTION 1729.47 OF THE REVISED CODE.
(5) ALL OF THE FOLLOWING APPLY: 2,085
(a) THE ARTICLES OF INCORPORATION OR BYLAWS OF THE 2,087
ASSOCIATION DO NOT PROVIDE A REASONABLE BASIS FOR DETERMINING AND 2,088
PAYING FAIR CASH VALUE TO AN AFFECTED STOCKHOLDER; 2,089
(b) THE ASSOCIATION AND THE AFFECTED STOCKHOLDER HAVE NOT 2,091
AGREED UPON THE FAIR CASH VALUE OF THE STOCK WHICH IS THE SUBJECT 2,092
OF THE DEMAND;
(c) THE AFFECTED STOCKHOLDER DOES NOT FILE A TIMELY 2,094
COMPLAINT UNDER SECTION 1729.47 OF THE REVISED CODE. 2,095
(D) THE FAIR CASH VALUE THAT IS AGREED UPON BY THE 2,097
AFFECTED STOCKHOLDER AND THE ASSOCIATION, OR DETERMINED USING A 2,098
REASONABLE BASIS FOR DETERMINING AND PAYING FAIR CASH VALUE IN 2,099
THE ASSOCIATION'S ARTICLES OF INCORPORATION OR BYLAWS, OR FIXED 2,100
51
BY A COURT IN A PROCEEDING UNDER SECTION 1729.47 OF THE REVISED 2,101
CODE, SHALL BE PAID WITHIN THIRTY DAYS AS FOLLOWS:
(1) IMMEDIATELY TO THE HOLDER OF UNCERTIFICATED STOCK; 2,103
(2) UPON AND SIMULTANEOUSLY WITH THE SURRENDER OF 2,105
CERTIFICATES REPRESENTING CERTIFICATED STOCK. 2,106
Sec. 1729.47. (A) IF THE ASSOCIATION'S ARTICLES OF 2,108
INCORPORATION OR BYLAWS DO NOT PROVIDE A REASONABLE BASIS FOR 2,110
DETERMINING AND PAYING FAIR CASH VALUE OF THE STOCK THAT IS THE 2,111
SUBJECT OF THE DEMAND FOR PAYMENT OF FAIR CASH VALUE AND THE 2,112
AFFECTED STOCKHOLDER HAS NOT AGREED UPON A FAIR CASH VALUE OF THE 2,113
STOCK THAT IS THE SUBJECT OF THE DEMAND WITHIN THREE MONTHS AFTER 2,114
DELIVERY OF THE DEMAND FOR PAYMENT OF FAIR CASH VALUE, THE 2,115
AFFECTED STOCKHOLDER, WITHIN THIRTY DAYS THEREAFTER, MAY FILE A 2,117
COMPLAINT FOR RECOVERY OF FAIR CASH VALUE OF THE STOCK FROM THE 2,119
ASSOCIATION OR THE SURVIVING, NEW, OR RESULTING ASSOCIATION OR
ENTITY IN THE COURT OF COMMON PLEAS OF THE COUNTY IN WHICH THE 2,121
PRINCIPAL OFFICE OF THE ASSOCIATION THAT ISSUED THE STOCK IS OR 2,122
WAS LOCATED. OTHER AFFECTED STOCKHOLDERS WHO HAVE MADE TIMELY 2,124
DEMAND FOR PAYMENT OF FAIR CASH VALUE MAY JOIN AS PLAINTIFFS IN 2,125
THE PROCEEDING AND ANY TWO OR MORE PROCEEDINGS COMMENCED BY 2,126
AFFECTED STOCKHOLDERS MAY BE CONSOLIDATED. THE COMPLAINT SHALL 2,127
CONTAIN A BRIEF STATEMENT OF THE RELEVANT FACTS, INCLUDING THE
VOTE BY MEMBERS OF THE ASSOCIATION, THE FACTS ENTITLING THE 2,128
STOCKHOLDER TO RELIEF UNDER THIS SECTION, AND A DEMAND FOR THAT 2,129
RELIEF. NOTWITHSTANDING THE RULES OF CIVIL PROCEDURE, NO ANSWER 2,130
TO A COMPLAINT FILED UNDER THIS SECTION IS REQUIRED. 2,131
(B) UPON FILING THE COMPLAINT AND UPON MOTION OF THE 2,133
COMPLAINANT, THE COURT SHALL FIX A DATE FOR HEARING ON THE 2,134
COMPLAINT AND REQUIRE SERVICE OF A NOTICE OF THE COMPLAINT AND 2,135
THE DATE FOR HEARING ON THE DEFENDANT IN THE MANNER PRESCRIBED IN 2,136
THE RULES OF CIVIL PROCEDURE FOR SERVICE OF PROCESS. 2,137
(C) ON THE DATE FIXED FOR THE HEARING OR ANY ADJOURNMENT 2,139
THEREOF, THE COURT SHALL DETERMINE FROM THE COMPLAINT AND ANY 2,140
EVIDENCE SUBMITTED AT THE HEARING BY THE PARTIES, WHETHER THE 2,141
52
AFFECTED STOCKHOLDER IS ENTITLED TO THE FAIR CASH VALUE OF STOCK 2,142
THAT IS THE SUBJECT OF THE DEMAND AND, IF THE STOCKHOLDER IS TO 2,143
BE SO PAID, THE NUMBER AND CLASS OF STOCK FOR WHICH PAYMENT IS TO 2,144
BE MADE.
(D) IF THE COURT FINDS THAT THE AFFECTED STOCKHOLDER IS TO 2,146
BE PAID, IT MAY APPOINT ONE OR MORE PERSONS AS APPRAISERS TO 2,147
RECEIVE EVIDENCE AS TO THE FAIR CASH VALUE. THE APPRAISERS SHALL 2,148
HAVE THE POWER AND AUTHORITY THAT THE COURT SPECIFIES IN THE 2,149
ORDER OF APPOINTMENT, AND THE COURT SHALL FIX REASONABLE 2,150
COMPENSATION FOR THE APPRAISERS. AFTER RECEIVING THE
RECOMMENDATION OF ANY APPOINTED APPRAISER, OR IF APPRAISERS ARE 2,151
NOT APPOINTED, THE COURT SHALL MAKE FINDINGS AS TO THE FAIR CASH 2,152
VALUE AND RENDER JUDGMENT FOR THE PAYMENT OF THAT FAIR CASH VALUE 2,153
AND INTEREST AT THE RATE AND FROM THE DATE THE COURT CONSIDERS 2,154
EQUITABLE. THE COSTS OF THE PROCEEDING, INCLUDING COMPENSATION 2,155
OF THE APPOINTED APPRAISERS AS FIXED BY THE COURT, SHALL BE
ASSESSED AS THE COURT CONSIDERS EQUITABLE. 2,156
(E) THE PROCEEDING ON THE COMPLAINT FOR FAIR CASH VALUE IS 2,158
A SPECIAL PROCEEDING, AND FINAL ORDERS IN IT MAY BE VACATED, 2,159
MODIFIED, OR REVERSED ON APPEAL PURSUANT TO THE RULES OF 2,160
APPELLATE PROCEDURE. 2,161
Sec. 1729.49. (A) AS USED IN THIS SECTION, "SUBSTANTIALLY 2,163
ALL" MEANS MORE THAN TWO-THIRDS OF THE ASSOCIATION'S ASSETS, 2,164
MEASURED, IN THE BOARD'S DISCRETION, EITHER BY VALUE AS RECORDED 2,165
IN THE BOOKS AND RECORDS OF THE ASSOCIATION OR BY FAIR MARKET 2,166
VALUE.
(B) UNLESS THE ARTICLES OF INCORPORATION OR THE BYLAWS OF 2,168
AN ASSOCIATION OTHERWISE PROVIDE, A LEASE, SALE, EXCHANGE, 2,169
TRANSFER, OR OTHER DISPOSITION OF ANY ASSETS OF AN ASSOCIATION 2,170
MAY BE MADE UPON TERMS AND FOR CONSIDERATION, WHICH MAY CONSIST, 2,171
IN WHOLE OR IN PART, OF MONEY OR OTHER PROPERTY, INCLUDING SHARES 2,172
OR OTHER SECURITIES OR PROMISSORY OBLIGATIONS OF ANY ASSOCIATION 2,174
OR ENTITY, AS MAY BE AUTHORIZED BY THE BOARD. IF A LEASE, SALE, 2,175
EXCHANGE, TRANSFER, OR OTHER DISPOSITION, OR A SERIES OF SUCH 2,176
53
TRANSACTIONS, WOULD DISPOSE OF ALL, OR SUBSTANTIALLY ALL OF THE 2,177
ASSETS OF THE ASSOCIATION, THEN THE DISPOSITION MAY BE MADE ONLY 2,178
UPON A WRITTEN PLAN OF DISPOSITION PREPARED BY THE BOARD OR BY A 2,179
COMMITTEE SELECTED BY THE BOARD FOR THAT PURPOSE, AND ADOPTED IN 2,180
THE SAME MANNER AS PROVIDED FOR THE ADOPTION OF A RESOLUTION OF
DISSOLUTION IN SECTION 1729.55 OF THE REVISED CODE. A PLAN OF 2,182
DISPOSITION SHALL SET FORTH A GENERAL DESCRIPTION OR SUMMARY OF 2,183
THE ASSETS SUBJECT TO DISPOSITION, THE METHOD OF DISPOSITION, THE 2,184
INTENDED TRANSFEREE OF THE ASSETS, IF KNOWN TO THE BOARD OF 2,185
DIRECTORS, AND A GENERAL DESCRIPTION OF ANY MATERIAL EFFECT THE
BOARD BELIEVES THE DISPOSITION WILL HAVE ON THE INTERESTS OF THE 2,186
MEMBERS AND STOCKHOLDERS. NOTICE OF A MEETING OF THE MEMBERS AT 2,187
WHICH A PLAN OF DISPOSITION WILL BE VOTED ON SHALL BE GIVEN TO 2,188
ALL MEMBERS, WHETHER OR NOT ENTITLED TO VOTE AT THE MEETING. 2,189
SUCH NOTICE SHALL BE ACCOMPANIED BY A COPY OR SUMMARY OF THE PLAN 2,190
OF DISPOSITION AND A BALLOT FOR THOSE MEMBERS ENTITLED TO VOTE ON 2,191
THE PLAN.
(C) THE ASSOCIATION, BY ITS BOARD, MAY ABANDON A PLAN OF 2,194
DISPOSITION, SUBJECT TO THE CONTRACT RIGHTS OF OTHER PERSONS, IF
THE POWER OF ABANDONMENT IS CONFERRED UPON THE BOARD EITHER BY 2,195
THE TERMS OF THE TRANSACTION OR IN THE PLAN OF DISPOSITION. 2,196
(D) AN ACTION TO SET ASIDE A DISPOSITION OF ASSETS BY AN 2,198
ASSOCIATION, ON THE GROUND THAT ANY SECTION OF THE REVISED CODE 2,200
APPLICABLE TO THE LEASE, SALE, EXCHANGE, TRANSFER, OR OTHER 2,201
DISPOSITION OF ALL OR SUBSTANTIALLY ALL THE ASSETS OF SUCH
ASSOCIATION HAS NOT BEEN COMPLIED WITH, SHALL BE BROUGHT WITHIN 2,202
NINETY DAYS AFTER SUCH TRANSACTION, OR SUCH ACTION SHALL BE 2,203
FOREVER BARRED.
Sec. 1729.55. (A) AN ASSOCIATION MAY BE DISSOLVED 2,205
VOLUNTARILY IN THE MANNER PROVIDED IN THIS SECTION. 2,206
(B) A RESOLUTION OF DISSOLUTION FOR AN ASSOCIATION SHALL 2,208
STATE BOTH OF THE FOLLOWING: 2,209
(1) THAT THE ASSOCIATION ELECTS TO BE DISSOLVED; 2,211
(2) ANY ADDITIONAL PROVISION CONSIDERED NECESSARY WITH 2,213
54
RESPECT TO THE PROPOSED DISSOLUTION AND WINDING UP. 2,214
(C) BEFORE SUBSCRIPTIONS FOR MEMBERSHIP AND ANY STOCK OR 2,216
OTHER OWNERSHIP INTEREST HAVE BEEN RECEIVED, THE INCORPORATORS OR 2,217
A MAJORITY OF THE INCORPORATORS MAY ADOPT, BY A WRITING SIGNED BY 2,218
THEM, A RESOLUTION OF DISSOLUTION. 2,219
(D) THE DIRECTORS MAY ADOPT A RESOLUTION OF DISSOLUTION IN 2,221
THE FOLLOWING CASES: 2,222
(1) WHEN THE ASSOCIATION HAS BEEN ADJUDGED BANKRUPT OR HAS 2,224
MADE A GENERAL ASSIGNMENT FOR THE BENEFIT OF CREDITORS; 2,225
(2) BY LEAVE OF THE COURT, WHEN A RECEIVER HAS BEEN 2,227
APPOINTED IN A GENERAL CREDITORS' SUIT OR IN ANY SUIT IN WHICH 2,228
THE AFFAIRS OF THE ASSOCIATION ARE TO BE WOUND UP; 2,229
(3) WHEN SUBSTANTIALLY ALL OF THE ASSETS HAVE BEEN SOLD AT 2,231
JUDICIAL SALE OR OTHERWISE; 2,232
(4) WHEN THE ARTICLES OF INCORPORATION HAVE BEEN CANCELED 2,234
FOR FAILURE TO FILE ANNUAL FRANCHISE OR EXCISE TAX RETURNS OR FOR 2,235
FAILURE TO PAY FRANCHISE OR EXCISE TAXES AND THE ASSOCIATION HAS 2,236
NOT BEEN REINSTATED OR DOES NOT DESIRE TO BE REINSTATED; 2,237
(5) WHEN THE PERIOD OF EXISTENCE OF THE ASSOCIATION 2,239
SPECIFIED IN ITS ARTICLES HAS EXPIRED. 2,240
(E) AT A MEETING HELD FOR SUCH PURPOSE, THE MEMBERS MAY 2,242
ADOPT A RESOLUTION OF DISSOLUTION BY THE AFFIRMATIVE VOTE OF 2,243
SIXTY PER CENT OF THE MEMBER VOTES CAST ON SUCH PROPOSAL OR, IF 2,244
THE ARTICLES PROVIDE OR PERMIT, BY THE AFFIRMATIVE VOTE OF A 2,245
GREATER OR LESSER PROPORTION, THOUGH NOT LESS THAN A MAJORITY, OF 2,246
SUCH VOTING POWER, OF ANY PARTICULAR CLASS AS IS REQUIRED BY THE
ARTICLES OF INCORPORATION. NOTICE OF THE MEETING OF THE MEMBERS 2,247
SHALL BE GIVEN TO ALL MEMBERS AND STOCKHOLDERS WHETHER OR NOT 2,248
ENTITLED TO VOTE.
(F) UPON THE ADOPTION OF A RESOLUTION OF DISSOLUTION, A 2,250
CERTIFICATE SHALL BE FILED WITH THE SECRETARY OF STATE, ON A FORM 2,251
PRESCRIBED BY THE SECRETARY OF STATE, STATING ALL OF THE 2,253
FOLLOWING:
(1) THE NAME OF THE ASSOCIATION; 2,255
55
(2) A STATEMENT THAT A RESOLUTION OF DISSOLUTION HAS BEEN 2,257
ADOPTED, ITS MANNER OF ADOPTION, AND, IN THE CASE OF ITS ADOPTION 2,258
BY THE INCORPORATORS OR DIRECTORS, A STATEMENT OF THE BASIS FOR 2,259
SUCH ADOPTION;
(3) THE PLACE IN THIS STATE WHERE THE ASSOCIATION'S 2,261
PRINCIPAL OFFICE IS LOCATED; 2,262
(4) THE NAMES AND ADDRESSES OF THE ASSOCIATION'S DIRECTORS 2,264
AND OFFICERS, OR IF THE RESOLUTION OF DISSOLUTION IS ADOPTED BY 2,265
THE INCORPORATORS, THE NAMES AND ADDRESSES OF THE INCORPORATORS; 2,266
(5) THE NAME AND ADDRESS OF THE ASSOCIATION'S STATUTORY 2,268
AGENT.
(G) SUCH CERTIFICATE SHALL BE SIGNED AS FOLLOWS: 2,270
(1) WHEN THE RESOLUTION OF DISSOLUTION IS ADOPTED BY THE 2,272
INCORPORATORS, THE CERTIFICATE SHALL BE SIGNED BY NOT LESS THAN A 2,274
MAJORITY OF THE INCORPORATORS;
(2) WHEN THE RESOLUTION IS ADOPTED BY THE DIRECTORS OR BY 2,276
THE MEMBERS, THE CERTIFICATE SHALL BE SIGNED BY ANY AUTHORIZED 2,277
OFFICER. HOWEVER, IF NO AUTHORIZED OFFICER EXECUTES AND FILES 2,279
SUCH CERTIFICATE WITHIN THIRTY DAYS AFTER THE ADOPTION OF THE 2,280
RESOLUTION OR UPON ANY DATE SPECIFIED IN THE RESOLUTION AS THE 2,281
DATE UPON WHICH SUCH CERTIFICATE IS TO BE FILED OR UPON THE 2,282
EXPIRATION OF ANY PERIOD SPECIFIED IN THE RESOLUTION AS THE 2,283
PERIOD WITHIN WHICH SUCH CERTIFICATE IS TO BE FILED, WHICHEVER IS 2,284
LATEST, THE CERTIFICATE OF DISSOLUTION MAY BE SIGNED BY ANY THREE
MEMBERS, OR IF THERE ARE LESS THAN THREE MEMBERS, THEN BY ALL OF 2,285
THE MEMBERS, AND SHALL SET FORTH A STATEMENT THAT THE PERSONS 2,286
SIGNING THE CERTIFICATE ARE MEMBERS AND ARE FILING THE 2,287
CERTIFICATE BECAUSE OF THE FAILURE OF AN AUTHORIZED OFFICER TO DO 2,289
SO.
(H) A CERTIFICATE OF DISSOLUTION, FILED WITH THE SECRETARY 2,291
OF STATE, SHALL BE ACCOMPANIED BY ALL OF THE FOLLOWING: 2,292
(1) AN AFFIDAVIT OF ONE OR MORE OF THE PERSONS EXECUTING 2,294
THE CERTIFICATE OF DISSOLUTION OR OF ANY AUTHORIZED OFFICER OF 2,295
THE ASSOCIATION CONTAINING A STATEMENT OF THE COUNTIES, IF ANY, 2,297
56
IN THIS STATE IN WHICH THE ASSOCIATION HAS PERSONAL PROPERTY OR A 2,298
STATEMENT THAT THE ASSOCIATION IS OF A TYPE REQUIRED TO PAY
PERSONAL PROPERTY TAXES TO STATE AUTHORITIES ONLY; 2,299
(2) A RECEIPT, CERTIFICATE, OR OTHER EVIDENCE SHOWING THE 2,301
PAYMENT OF ALL FRANCHISE, SALES, USE, AND HIGHWAY USE TAXES 2,302
ACCRUING UP TO THE DATE OF SUCH FILING, OR THAT SUCH PAYMENT HAS 2,303
BEEN ADEQUATELY GUARANTEED;
(3) A RECEIPT, CERTIFICATE, OR OTHER EVIDENCE SHOWING THE 2,305
PAYMENT OF ALL PERSONAL PROPERTY TAXES ACCRUING UP TO THE DATE OF 2,306
SUCH FILING;
(4) A RECEIPT, CERTIFICATE, OR OTHER EVIDENCE FROM THE 2,308
BUREAU OF EMPLOYMENT SERVICES SHOWING THAT ALL CONTRIBUTIONS DUE 2,309
FROM THE ASSOCIATION AS AN EMPLOYER HAVE BEEN PAID, OR THAT SUCH 2,310
PAYMENT HAS BEEN ADEQUATELY GUARANTEED, OR THAT THE ASSOCIATION 2,311
IS NOT SUBJECT TO SUCH CONTRIBUTIONS;
(5) A RECEIPT, CERTIFICATE, OR OTHER EVIDENCE FROM THE 2,313
BUREAU OF WORKERS' COMPENSATION SHOWING THAT ALL PREMIUMS DUE 2,314
FROM THE ASSOCIATION AS AN EMPLOYER HAVE BEEN PAID, OR THAT SUCH 2,315
PAYMENT HAS BEEN ADEQUATELY GUARANTEED, OR THAT THE ASSOCIATION 2,316
IS NOT SUBJECT TO SUCH PREMIUM PAYMENTS;
(6) IN LIEU OF THE RECEIPT, CERTIFICATE, OR OTHER EVIDENCE 2,318
DESCRIBED IN DIVISION (H)(2), (3), (4), OR (5) OF THIS SECTION, 2,319
AN AFFIDAVIT OF ONE OR MORE PERSONS EXECUTING THE CERTIFICATE OF 2,320
DISSOLUTION OR OF ANY AUTHORIZED OFFICER OF THE ASSOCIATION 2,322
CONTAINING A STATEMENT OF THE DATE UPON WHICH THE PARTICULAR 2,323
DEPARTMENT, AGENCY, OR AUTHORITY WAS ADVISED IN WRITING OF THE 2,324
SCHEDULED DATE OF FILING OF THE CERTIFICATE OF DISSOLUTION AND 2,325
WAS ADVISED IN WRITING OF THE ACKNOWLEDGMENT BY THE ASSOCIATION 2,326
OF THE APPLICABILITY OF SECTION 1729.25 OF THE REVISED CODE. 2,327
(I) UPON THE FILING OF A CERTIFICATE OF DISSOLUTION AND 2,329
THE ACCOMPANYING DOCUMENTS REQUIRED BY DIVISION (H) OF THIS 2,330
SECTION, THE ASSOCIATION SHALL BE DISSOLVED. 2,331
Sec. 1729.56. FOLLOWING THE FILING OF THE CERTIFICATE OF 2,333
DISSOLUTION, THE DIRECTORS OR THE INCORPORATORS WHO FILED THE 2,334
57
CERTIFICATE, AS THE CASE MAY BE, SHALL CAUSE A NOTICE OF 2,335
VOLUNTARY DISSOLUTION TO BE PUBLISHED ONCE A WEEK ON THE SAME DAY 2,336
OF EACH WEEK FOR TWO SUCCESSIVE WEEKS, IN A NEWSPAPER PUBLISHED
AND OF GENERAL CIRCULATION IN THE COUNTY IN WHICH THE PRINCIPAL 2,337
OFFICE OF THE ASSOCIATION WAS TO BE OR IS LOCATED, AND SHALL 2,338
CAUSE WRITTEN NOTICE OF DISSOLUTION TO BE GIVEN TO ALL KNOWN 2,339
CREDITORS OF, AND TO ALL KNOWN CLAIMANTS AGAINST, THE DISSOLVED 2,340
ASSOCIATION.
Sec. 1729.58. (A) WHEN AN ASSOCIATION IS DISSOLVED 2,342
VOLUNTARILY, WHEN THE ARTICLES OF INCORPORATION OF AN ASSOCIATION 2,343
HAVE BEEN CANCELED, WHEN A FINAL ORDER OF A COURT OF COMMON PLEAS 2,344
IS MADE DISSOLVING AN ASSOCIATION UNDER SECTION 1729.59 OF THE 2,345
REVISED CODE, OR WHEN THE PERIOD OF EXISTENCE OF THE ASSOCIATION
SPECIFIED IN ITS ARTICLES OF INCORPORATION HAS EXPIRED, THE 2,346
ASSOCIATION SHALL CEASE TO CARRY ON BUSINESS AND SHALL DO ONLY 2,347
SUCH ACTS AS ARE REQUIRED TO WIND UP ITS AFFAIRS, OR TO OBTAIN 2,348
REINSTATEMENT OF THE ARTICLES IN ACCORDANCE WITH SECTION 1729.11 2,349
OF THE REVISED CODE.
(B) ANY CLAIM EXISTING OR ACTION OR PROCEEDING PENDING BY 2,351
OR AGAINST THE ASSOCIATION OR WHICH WOULD HAVE ACCRUED AGAINST IT 2,352
MAY BE PROSECUTED TO JUDGMENT, WITH RIGHT OF APPEAL AS IN OTHER 2,353
CASES, BUT ANY PROCEEDING, EXECUTION, OR PROCESS, OR THE 2,354
SATISFACTION OR PERFORMANCE OF ANY ORDER, JUDGMENT, OR DECREE, 2,355
MAY BE STAYED AS PROVIDED IN SECTION 1729.59 OF THE REVISED CODE.
(C) ANY PROCESS, NOTICE, OR DEMAND AGAINST THE ASSOCIATION 2,357
MAY BE SERVED BY DELIVERING A COPY TO AN OFFICER, DIRECTOR, 2,358
LIQUIDATOR, OR PERSON HAVING CHARGE OF ITS ASSETS OR, IF NO SUCH 2,359
PERSON CAN BE FOUND, TO THE STATUTORY AGENT. 2,360
(D) THE DIRECTORS OF THE ASSOCIATION OR THEIR SUCCESSORS 2,363
SHALL ACT AS A BOARD OF DIRECTORS IN ACCORDANCE WITH THE ARTICLES
OF INCORPORATION AND BYLAWS UNTIL THE AFFAIRS OF THE ASSOCIATION 2,364
ARE COMPLETELY WOUND UP. SUBJECT TO THE ORDERS OF COURTS OF THIS 2,365
STATE HAVING JURISDICTION OVER THE ASSOCIATION, THE DIRECTORS 2,366
SHALL PROCEED AS SPEEDILY AS IS PRACTICABLE TO A COMPLETE WINDING 2,367
58
UP OF THE AFFAIRS OF THE ASSOCIATION AND, TO THE EXTENT NECESSARY 2,368
OR EXPEDIENT TO THAT END, SHALL EXERCISE ALL THE AUTHORITY OF THE 2,369
ASSOCIATION. WITHOUT LIMITING THE GENERALITY OF SUCH AUTHORITY, 2,370
THE DIRECTORS MAY FILL VACANCIES, ELECT OFFICERS, CARRY OUT
CONTRACTS OF THE ASSOCIATION, MAKE NEW CONTRACTS, BORROW MONEY, 2,371
MORTGAGE OR PLEDGE THE PROPERTY OF THE ASSOCIATION AS SECURITY, 2,372
SELL ITS ASSETS AT PUBLIC OR PRIVATE SALE, MAKE CONVEYANCES IN 2,373
THE ASSOCIATION'S NAME, LEASE REAL ESTATE FOR ANY TERM, INCLUDING 2,374
NINETY-NINE YEARS RENEWABLE FOREVER, SETTLE OR COMPROMISE CLAIMS 2,375
IN FAVOR OF OR AGAINST THE ASSOCIATION, EMPLOY ONE OR MORE
PERSONS AS LIQUIDATORS TO WIND UP THE AFFAIRS OF THE ASSOCIATION 2,376
WITH SUCH AUTHORITY AS THE DIRECTORS SEE FIT TO GRANT, CAUSE THE 2,377
TITLE TO ANY OF THE ASSETS OF THE ASSOCIATION TO BE CONVEYED TO 2,378
SUCH LIQUIDATORS FOR THAT PURPOSE, APPLY ASSETS TO THE PAYMENT OF 2,379
OBLIGATIONS, AND, AFTER PAYING OR ADEQUATELY PROVIDING FOR THE 2,380
PAYMENT OF ALL KNOWN OBLIGATIONS OF THE ASSOCIATION, DISTRIBUTE 2,381
THE REMAINDER OF THE ASSETS EITHER IN CASH OR IN KIND AMONG THE
MEMBERS, PATRONS, AND STOCKHOLDERS ACCORDING TO THEIR RESPECTIVE 2,382
RIGHTS AND INTERESTS. IN ADDITION, THE DIRECTORS MAY PERFORM ALL 2,383
OTHER ACTS NECESSARY OR EXPEDIENT TO THE WINDING UP OF THE 2,384
AFFAIRS OF THE ASSOCIATION.
(E) WITHOUT LIMITING THE AUTHORITY OF THE DIRECTORS, ANY 2,386
ACTION WITHIN THE PURVIEW OF THIS SECTION THAT IS AUTHORIZED OR 2,387
APPROVED AT A MEETING OF THE MEMBERS BY SIXTY PER CENT OF THE 2,388
MEMBER VOTES CAST THEREON SHALL BE CONCLUSIVE FOR ALL PURPOSES 2,389
UPON ALL MEMBERS, PATRONS, AND STOCKHOLDERS OF THE ASSOCIATION. 2,390
(F) ALL DEEDS AND OTHER INSTRUMENTS OF THE ASSOCIATION 2,392
SHALL BE IN THE NAME OF THE ASSOCIATION AND SHALL BE EXECUTED, 2,393
ACKNOWLEDGED, AND DELIVERED BY THE OFFICERS APPOINTED BY THE 2,394
DIRECTORS.
(G) AT ANY TIME DURING THE WINDING UP OF ITS AFFAIRS, THE 2,396
ASSOCIATION BY ITS DIRECTORS MAY MAKE APPLICATION TO THE COURT OF 2,397
COMMON PLEAS OF THE COUNTY IN THIS STATE IN WHICH THE PRINCIPAL 2,398
OFFICE OF THE ASSOCIATION IS LOCATED TO HAVE THE WINDING UP 2,399
59
CONTINUED UNDER SUPERVISION OF THE COURT, AS PROVIDED IN SECTION 2,400
1729.59 OF THE REVISED CODE.
Sec. 1729.59. (A) WITHOUT LIMITING THE GENERALITY OF ITS 2,402
AUTHORITY, THE COURT OF COMMON PLEAS OF THE COUNTY IN THIS STATE 2,403
IN WHICH IS LOCATED THE PRINCIPAL OFFICE OF A VOLUNTARILY 2,404
DISSOLVED ASSOCIATION OR OF AN ASSOCIATION WHOSE ARTICLES HAVE 2,405
BEEN CANCELED OR WHOSE PERIOD OF EXISTENCE HAS EXPIRED, UPON THE 2,406
COMPLAINT OF THE ASSOCIATION, OR A MAJORITY OF THE DIRECTORS, OR 2,407
TEN PER CENT OF THE MEMBERS OR TWENTY MEMBERS, WHICHEVER IS LESS, 2,408
AND UPON SUCH NOTICE TO ALL THE DIRECTORS AND SUCH OTHER PERSONS
INTERESTED AS THE COURT CONSIDERS PROPER, AT ANY TIME MAY ORDER 2,409
AND ADJUDGE ANY OF THE FOLLOWING MATTERS: 2,410
(1) THE PRESENTATION AND PROOF OF ALL CLAIMS AND DEMANDS 2,412
AGAINST THE ASSOCIATION AND OF ALL RIGHTS, INTERESTS, OR LIENS IN 2,413
OR ON ANY OF ITS PROPERTY; THE FIXING OF THE TIME AND THE MANNER 2,414
IN WHICH SUCH PROOF SHALL BE MADE AND THE PERSON TO WHOM SUCH 2,415
PRESENTATION SHALL BE MADE; AND THE BARRING FROM PARTICIPATION IN 2,416
ANY DISTRIBUTION OF ASSETS OF ALL PERSONS FAILING TO MAKE AND 2,418
PRESENT PROOFS AS REQUIRED BY THE ORDER OF THE COURT;
(2) THE STAY OF THE PROSECUTION OF ANY PROCEEDING AGAINST 2,420
THE ASSOCIATION OR INVOLVING ANY OF ITS PROPERTY, AND THE 2,421
REQUIREMENT THAT THE PARTIES TO THE PROCEEDING PRESENT AND PROVE 2,422
THEIR CLAIMS, DEMANDS, RIGHTS, INTERESTS, OR LIENS AT THE TIME 2,423
AND IN THE MANNER REQUIRED OF CREDITORS OR OTHERS; OR THE GRANT 2,424
OF LEAVE TO BRING OR MAINTAIN AN INDEPENDENT PROCEEDING TO
ENFORCE LIENS; 2,425
(3) THE SETTLEMENT OR DETERMINATION OF ALL CLAIMS OF EVERY 2,427
NATURE AGAINST THE ASSOCIATION OR ANY OF ITS PROPERTY; THE 2,428
DETERMINATION OF THE ASSETS REQUIRED TO BE RETAINED TO PAY OR 2,429
PROVIDE FOR THE PAYMENT OF SUCH CLAIMS OR ANY CLAIM; THE 2,430
DETERMINATION OF THE ASSETS AVAILABLE FOR DISTRIBUTION AMONG AND 2,431
RIGHTS OF MEMBERS, PATRONS, AND STOCKHOLDERS; AND THE MAKING OF
NEW PARTIES TO THE PROCEEDING SO FAR AS THE COURT CONSIDERS 2,432
PROPER FOR THE DETERMINATION OF ALL MATTERS; 2,433
60
(4) THE PRESENTATION AND FILING OF INTERMEDIATE AND FINAL 2,435
ACCOUNTS OF THE DIRECTORS OR OF THE LIQUIDATORS AND HEARINGS ON 2,436
THEM; THE ALLOWANCE, DISALLOWANCE, OR SETTLEMENT OF THE ACCOUNTS; 2,437
AND THE DISCHARGE OF THE DIRECTORS, THE LIQUIDATORS, OR ANY OF 2,438
THEM FROM THEIR DUTIES AND LIABILITIES;
(5) THE APPOINTMENT OF A SPECIAL MASTER COMMISSIONER TO 2,440
HEAR AND DETERMINE ANY SUCH MATTERS WITH SUCH AUTHORITY AS THE 2,441
COURT CONSIDERS PROPER;
(6) THE FILLING OF ANY VACANCIES IN THE NUMBER OF 2,443
DIRECTORS OR LIQUIDATORS WHEN THE DIRECTORS ARE UNABLE TO ACT ON 2,444
THE VACANCIES FOR WANT OF A QUORUM OR FOR ANY OTHER REASON; 2,445
(7) THE APPOINTMENT OF A RECEIVER, IN ACCORDANCE WITH THE 2,447
USAGE OF A COURT IN EQUITABLE MATTERS, TO WIND UP THE AFFAIRS OF 2,448
THE ASSOCIATION, TO TAKE CUSTODY OF ANY OF ITS PROPERTY, OR FOR 2,449
ANY OTHER PURPOSE;
(8) THE ISSUANCE OR ENTRY OF ANY INJUNCTION OR ANY OTHER 2,451
ORDER THAT THE COURT CONSIDERS PROPER IN THE ADMINISTRATION OF 2,452
THE TRUST INVOLVED IN THE WINDING UP OF THE AFFAIRS OF THE 2,453
ASSOCIATION AND THE GIVING OF NOTICE OF THE ENTRY OF INJUNCTION 2,454
OR ORDER;
(9) THE ALLOWANCE AND PAYMENT OF COMPENSATION TO THE 2,456
DIRECTORS OR ANY OF THEM, TO LIQUIDATORS, TO A RECEIVER, TO THE 2,457
ATTORNEY FOR THE COMPLAINANT, OR TO ANY PERSON PROPERLY RENDERING 2,458
SERVICES BENEFICIAL TO THE ASSOCIATION OR TO THOSE INTERESTED IN 2,459
IT;
(10) THE ENTRY OF A JUDGMENT OR DECREE THAT, IF IT SO 2,461
PROVIDES, MAY OPERATE AS THE DEED OR OTHER INSTRUMENT ORDERED TO 2,462
BE EXECUTED, OR THE APPOINTMENT OF A MASTER TO EXECUTE SUCH DEED 2,463
OR INSTRUMENT IN THE NAME OF THE ASSOCIATION WITH THE SAME EFFECT 2,464
AS IF EXECUTED BY AN AUTHORIZED OFFICER PURSUANT TO AUTHORITY 2,465
CONFERRED BY THE DIRECTORS OR THE MEMBERS, PATRONS, AND
STOCKHOLDERS OF THE ASSOCIATION, WHENEVER THERE IS NO OFFICER OR 2,466
AGENT COMPETENT TO EXECUTE SUCH DEED OR INSTRUMENT, WHENEVER THE 2,467
ASSOCIATION OR ITS OFFICERS DO NOT PERFORM OR COMPLY WITH A 2,468
61
JUDGMENT OR DECREE OF COURT, OR WHENEVER THE COURT CONSIDERS IT 2,469
PROPER.
(B) A JUDICIAL PROCEEDING UNDER THIS SECTION CONCERNING 2,471
THE WINDING UP OF THE AFFAIRS OF AN ASSOCIATION IS A SPECIAL 2,472
PROCEEDING, AND FINAL ORDERS IN THE PROCEEDING MAY BE VACATED, 2,473
MODIFIED, OR REVERSED ON APPEAL PURSUANT TO THE RULES OF 2,474
APPELLATE PROCEDURE AND, TO THE EXTENT NOT IN CONFLICT WITH THOSE 2,475
RULES, CHAPTER 2505. OF THE REVISED CODE.
Sec. 1729.60. (A) WHENEVER, AFTER AN ASSOCIATION IS 2,477
DISSOLVED VOLUNTARILY, THE ARTICLES OF AN ASSOCIATION HAVE BEEN 2,478
CANCELED, OR THE PERIOD OF EXISTENCE OF AN ASSOCIATION HAS 2,479
EXPIRED, A RECEIVER IS APPOINTED TO WIND UP THE AFFAIRS OF THE 2,480
ASSOCIATION, ALL THE CLAIMS, DEMANDS, RIGHTS, INTERESTS, OR LIENS 2,481
OF CREDITORS, CLAIMANTS, MEMBERS, PATRONS, AND STOCKHOLDERS SHALL
BE DETERMINED AS OF THE DAY ON WHICH THE RECEIVER WAS APPOINTED. 2,482
UNLESS IT IS OTHERWISE ORDERED, SUCH APPOINTMENT VESTS IN THE 2,483
RECEIVER AND SUCCESSORS OF THE RECEIVER THE RIGHT TO THE 2,484
IMMEDIATE POSSESSION OF ALL THE PROPERTY OF THE ASSOCIATION, 2,485
WHICH SHALL, IF SO ORDERED, EXECUTE AND DELIVER CONVEYANCES OF
SUCH PROPERTY TO THE RECEIVER. 2,486
(B) ANY OFFICER, DIRECTOR, MEMBER, OR OTHER PERSON, 2,488
WHETHER A RESIDENT OF THE STATE OR A NONRESIDENT AND HOWEVER 2,489
INTERESTED, MAY BE APPOINTED AS RECEIVER. 2,490
(C) THE RECEIVER SHALL HAVE ALL THE AUTHORITY VESTED IN 2,492
THE DIRECTORS AND OFFICERS OF THE ASSOCIATION, SHALL EXERCISE 2,493
SUCH AUTHORITY SUBJECT TO SUCH ORDERS AS ARE MADE BY THE COURT, 2,494
AND MAY BE REQUIRED TO QUALIFY BY GIVING BOND TO THE STATE IN 2,495
SUCH AMOUNT AS THE COURT FIXES, WITH SURETY TO THE SATISFACTION 2,496
OF THE CLERK OF THE COURT, CONDITIONED FOR THE FAITHFUL DISCHARGE 2,497
OF DUTIES AND FOR A DUE ACCOUNTING FOR ALL MONEY OR PROPERTY 2,498
RECEIVED.
Sec. 1729.61. (A) AN ASSOCIATION MAY BE DISSOLVED 2,500
JUDICIALLY AND ITS AFFAIRS WOUND UP BY AN ORDER OF THE COURT OF 2,501
COMMON PLEAS OF THE COUNTY IN THIS STATE IN WHICH THE ASSOCIATION 2,502
62
HAS ITS PRINCIPAL OFFICE, IN AN ACTION BROUGHT BY THE MEMBERS 2,503
HAVING SIXTY PER CENT OF THE VOTING POWER OF THE ASSOCIATION ON 2,504
SUCH PROPOSAL, OR THE HOLDERS OF SUCH LESSER PROPORTION AS ARE
ENTITLED BY THE ARTICLES OF INCORPORATION TO DISSOLVE THE 2,505
ASSOCIATION VOLUNTARILY, WHEN IT IS ESTABLISHED THAT IT IS 2,506
BENEFICIAL TO THE MEMBERS, PATRONS, AND STOCKHOLDERS THAT THE 2,507
ASSOCIATION BE JUDICIALLY DISSOLVED.
(B) A COMPLAINT FOR JUDICIAL DISSOLUTION SHALL BE VERIFIED 2,509
BY ANY OF THE COMPLAINANTS AND SHALL SET FORTH FACTS SHOWING THAT 2,510
THE CASE IS AS SPECIFIED IN THIS SECTION. UNLESS THE 2,511
COMPLAINANTS SET FORTH IN THE COMPLAINT THAT THEY ARE UNABLE TO 2,512
ANNEX A LIST OF MEMBERS, PATRONS, OR STOCKHOLDERS, A SCHEDULE 2,513
SHALL BE ANNEXED TO THE COMPLAINT SETTING FORTH THE NAME AND
ADDRESS OF EACH MEMBER, PATRON, AND STOCKHOLDER, IF IT IS KNOWN, 2,514
OR THE FACT THAT IT IS NOT KNOWN. 2,516
(C) UPON THE FILING OF A COMPLAINT FOR JUDICIAL 2,518
DISSOLUTION, THE COURT WITH WHICH IT IS FILED SHALL HAVE POWER TO 2,519
ISSUE INJUNCTIONS, TO APPOINT A RECEIVER WITH SUCH AUTHORITY AND 2,520
DUTIES AS THE COURT FROM TIME TO TIME MAY DIRECT, TO TAKE SUCH 2,521
OTHER PROCEEDINGS AS MAY BE NECESSARY TO PROTECT THE PROPERTY OR 2,522
THE RIGHTS OF THE MEMBERS, PATRONS, AND STOCKHOLDERS, AND TO
CARRY ON THE BUSINESS OF THE ASSOCIATION UNTIL A FULL HEARING CAN 2,523
BE CONDUCTED. UPON OR AFTER THE FILING OF A COMPLAINT FOR 2,524
JUDICIAL DISSOLUTION, THE COURT, BY INJUNCTION OR ORDER, MAY STAY 2,525
THE PROSECUTION OF ANY PROCEEDING AGAINST THE ASSOCIATION OR 2,526
INVOLVING ANY OF ITS PROPERTY AND REQUIRE THE PARTIES TO THE
PROCEEDING TO PRESENT AND PROVE THEIR CLAIMS, DEMANDS, RIGHTS, 2,527
INTERESTS, OR LIENS, AT THE TIME AND IN THE MANNER REQUIRED OF 2,528
CREDITORS OR OTHERS. THE COURT MAY REFER THE COMPLAINT TO A 2,529
SPECIAL MASTER COMMISSIONER.
(D) AFTER A HEARING UPON SUCH NOTICE AS THE COURT MAY 2,531
DIRECT TO BE GIVEN TO ALL PARTIES TO THE PROCEEDING AND TO ANY 2,532
OTHER PARTIES IN INTEREST DESIGNATED BY THE COURT, A FINAL ORDER 2,533
BASED EITHER UPON THE EVIDENCE, OR UPON THE REPORT OF THE SPECIAL 2,534
63
MASTER COMMISSIONER IF ONE HAS BEEN APPOINTED, SHALL BE MADE 2,535
DISSOLVING THE ASSOCIATION OR DISMISSING THE COMPLAINT. AN
ORDER OR JUDGMENT FOR THE JUDICIAL DISSOLUTION OF AN ASSOCIATION 2,536
SHALL CONTAIN A CONCISE STATEMENT OF THE PROCEEDINGS LEADING UP 2,537
TO THE ORDER OR JUDGMENT, THE NAME OF THE ASSOCIATION, THE PLACE 2,538
IN THIS STATE WHERE ITS PRINCIPAL OFFICE IS LOCATED, THE NAMES 2,539
AND ADDRESSES OF ITS DIRECTORS AND OFFICERS, THE NAME AND ADDRESS 2,540
OF A STATUTORY AGENT, AND, IF DESIRED, SUCH OTHER PROVISIONS WITH
RESPECT TO THE JUDICIAL DISSOLUTION AND WINDING UP AS ARE 2,541
CONSIDERED NECESSARY OR DESIRABLE. A CERTIFIED COPY OF SUCH 2,542
ORDER SHALL BE FILED IN THE OFFICE OF THE SECRETARY OF STATE, 2,543
WHEREUPON THE ASSOCIATION SHALL BE DISSOLVED. TO THE EXTENT 2,544
CONSISTENT WITH ORDERS ENTERED IN SUCH PROCEEDING, THE EFFECT OF
SUCH JUDICIAL DISSOLUTION SHALL BE THE SAME AS IN THE CASE OF 2,545
VOLUNTARY DISSOLUTION, AND THE PROVISIONS OF SECTIONS 1729.58, 2,546
1729.59, AND 1729.60 OF THE REVISED CODE RELATING TO THE 2,547
AUTHORITY AND DUTIES OF DIRECTORS DURING THE WINDING UP OF THE
AFFAIRS OF AN ASSOCIATION DISSOLVED VOLUNTARILY, WITH RESPECT TO 2,548
THE JURISDICTION OF COURTS OVER THE WINDING UP OF THE AFFAIRS OF 2,549
AN ASSOCIATION, AND WITH RESPECT TO RECEIVERS FOR WINDING UP THE 2,550
AFFAIRS OF AN ASSOCIATION, SHALL BE APPLICABLE TO ASSOCIATIONS 2,551
JUDICIALLY DISSOLVED.
(E) A PROCEEDING UNDER THIS SECTION FOR JUDICIAL 2,553
DISSOLUTION OF AN ASSOCIATION IS A SPECIAL PROCEEDING, AND FINAL 2,554
ORDERS IN IT MAY BE VACATED, MODIFIED, OR REVERSED ON APPEAL 2,555
PURSUANT TO THE RULES OF APPELLATE PROCEDURE AND, TO THE EXTENT 2,556
NOT IN CONFLICT WITH THOSE RULES, CHAPTER 2505. OF THE REVISED 2,557
CODE.
Sec. 1729.67. (A) A COOPERATIVE AND ANY MEMBER MAY MAKE 2,559
MARKETING AGREEMENTS, WHETHER WRITTEN SEPARATELY OR CONTAINED IN 2,560
THE BYLAWS, IN WHICH THE MEMBER AGREES TO DO ANY OF THE 2,562
FOLLOWING:
(1) SELL, MARKET, OR DELIVER ALL OR ANY SPECIFIED PART OF 2,564
PRODUCTS PRODUCED OR TO BE PRODUCED EITHER BY THE MEMBER OR UNDER 2,565
64
THE MEMBER'S CONTROL, TO OR THROUGH THE COOPERATIVE OR ANY 2,566
FACILITIES FURNISHED BY IT;
(2) AUTHORIZE THE COOPERATIVE OR ANY FACILITIES FURNISHED 2,568
BY IT TO ACT FOR THE MEMBER IN ANY MANNER WITH RESPECT TO ALL OR 2,569
ANY SPECIFIED PART OF PRODUCTS PRODUCED OR TO BE PRODUCED EITHER 2,570
BY THE MEMBER OR UNDER THE MEMBER'S CONTROL AND ANY SERVICES TO 2,571
BE FURNISHED BY THE MEMBER;
(3) BUY OR PROCURE ALL OR A SPECIFIED PART OF GOODS OR 2,573
SERVICES FROM OR THROUGH THE COOPERATIVE OR ANY FACILITIES 2,574
FURNISHED BY IT;
(4) AUTHORIZE THE COOPERATIVE OR ANY FACILITIES FURNISHED 2,576
BY IT TO ACT FOR THE MEMBER IN ANY MANNER IN THE PROCUREMENT OF 2,577
GOODS OR SERVICES FOR THE MEMBER. 2,578
(B) THE TERM OF MARKETING AGREEMENTS MAY NOT EXCEED TEN 2,580
YEARS.
(C) A MARKETING AGREEMENT AUTHORIZED BY DIVISION (A) OF 2,582
THIS SECTION MAY REQUIRE THAT LIQUIDATED DAMAGES BE PAID BY THE 2,583
MEMBER IN THE EVENT OF A BREACH OF THE MARKETING AGREEMENT. 2,584
LIQUIDATED DAMAGES SHALL BE SPECIFIC, REASONABLE SUMS. ANY 2,585
PROVISIONS FOR LIQUIDATED DAMAGES SHALL BE ENFORCEABLE AND NOT 2,586
REGARDED AS PENALTIES.
(D) IF A MEMBER BREACHES OR THREATENS TO BREACH A 2,588
MARKETING AGREEMENT AUTHORIZED BY THIS SECTION, THE COOPERATIVE 2,589
SHALL BE ENTITLED TO AN INJUNCTION TO PREVENT THE BREACH OR ANY 2,590
FURTHER BREACH, AND TO A DECREE OF SPECIFIC PERFORMANCE. UPON 2,591
FILING OF A VERIFIED COMPLAINT SHOWING THE BREACH OR THREATENED 2,592
BREACH, AND UPON FILING A SUFFICIENT BOND, THE COOPERATIVE IS
ENTITLED TO A TEMPORARY RESTRAINING ORDER AGAINST THE MEMBER. 2,593
(E) IF ANY MARKETING AGREEMENT AUTHORIZED BY DIVISION 2,596
(A)(1) OR (2) OF THIS SECTION CONTAINS AN ASSIGNMENT TO THE
COOPERATIVE OF ANY PART OR ALL OF THE FUNDS DUE OR TO BECOME DUE 2,597
THE MEMBER DURING THE LIFE OF THE MARKETING AGREEMENT FOR ANY 2,598
PRODUCT PRODUCED OR TO BE PRODUCED BY THE MEMBER OR FOR ANY 2,599
SERVICES PERFORMED OR TO BE PERFORMED IN PRODUCING ANY PRODUCT, 2,600
65
ANY PERSON WHO ACCEPTS OR RECEIVES THE PRODUCT FROM THE MEMBER IS 2,601
BOUND BY THE ASSIGNMENT AFTER RECEIVING WRITTEN NOTICE FROM THE
COOPERATIVE OR THE MEMBER OF THE AMOUNT AND DURATION OF THE 2,602
ASSIGNMENT. HOWEVER, AS TO ANY SEASONAL CROP, IF NO FUNDS ARE 2,603
PAID OR BECOME PAYABLE BY ANY PERSON UNDER SUCH AN ASSIGNMENT FOR 2,604
A PERIOD OF TWO CONSECUTIVE YEARS DURING THE LIFE OF THE 2,605
MARKETING AGREEMENT, THEREAFTER THE ASSIGNMENT SHALL NOT BE 2,606
BINDING UPON ANY PERSON WHO RECEIVES OR ACCEPTS SUCH PRODUCT FROM
THE MEMBER UNTIL THE ASSIGNMENT IS REAFFIRMED BY THE MEMBER IN 2,607
WRITING AND WRITTEN NOTICE IS GIVEN BY THE COOPERATIVE OR THE 2,608
MEMBER. ANY SUCH REAFFIRMATION SHALL CONTINUE TO BE EFFECTIVE 2,609
DURING THE LIFE OF THE MARKETING AGREEMENT UNTIL ANOTHER SUCH 2,610
LAPSE OF TWO CONSECUTIVE YEARS OCCURS.
Sec. 1729.68. (A) NO PROCESSOR, HANDLER, DISTRIBUTOR, OR 2,612
DEALER, OR AGENT THEREOF, WHO PURCHASES OR CONTRACTS TO PURCHASE 2,613
ANY PRODUCT FROM A PERSON WHO PRODUCED THE PRODUCT, OR PROCURES 2,614
FOR, SELLS, OR OTHERWISE FURNISHES INPUTS, SERVICES, OR SUPPLIES 2,615
TO A PERSON SHALL DO EITHER OF THE FOLLOWING: 2,616
(1) USE DURESS AGAINST, COERCE, OR BOYCOTT THE PERSON IN 2,618
THE EXERCISE OF THE PERSON'S RIGHTS TO JOIN AND BELONG TO A 2,619
COOPERATIVE;
(2) DISCRIMINATE AGAINST THE PERSON WITH RESPECT TO PRICE, 2,621
QUANTITY, OR QUALITY, OR OTHER TERMS OF PURCHASE OR SALE OF 2,622
PRODUCTS OR PRODUCE, SERVICES, OR SUPPLIES, SOLELY BY REASON OF 2,623
THE PERSON'S MEMBERSHIP IN OR MARKETING AGREEMENT WITH A 2,624
COOPERATIVE.
(B) A MEMBER OR COOPERATIVE ON BEHALF OF ITS MEMBER OR 2,626
MEMBERS MAY BRING AN ACTION TO ENJOIN ANY VIOLATION OF THIS 2,627
SECTION, AND, UPON FILING A SUFFICIENT BOND, A COOPERATIVE IS 2,628
ENTITLED TO A TEMPORARY RESTRAINING ORDER AGAINST ANYONE WHO 2,629
VIOLATES OR THREATENS TO VIOLATE THIS SECTION AS SET FORTH IN THE 2,630
COMPLAINT IN THE COURT OF COMMON PLEAS OF THE COUNTY IN WHICH THE
VIOLATION OCCURRED. ACTIONS AGAINST DIFFERENT DEFENDANTS MAY BE 2,631
CONSOLIDATED, IN THE DISCRETION OF THE COURT, IF THE ALLEGED 2,632
66
VIOLATIONS ARE OF THE SAME PROVISION, HAVE OCCURRED IN THE SAME 2,633
OR ADJOINING COUNTIES, RELATE TO THE SAME PRODUCT, SERVICE, OR 2,634
SUPPLY, AND THE CONSOLIDATION CAN BE MADE WITHOUT PREJUDICE TO A 2,635
SUBSTANTIAL RIGHT OF ANY DEFENDANT.
(C) ANY PERSON WHO SOLICITS OR PERSUADES OR PERMITS OR 2,637
AIDS OR ABETS, INDUCES, OR ATTEMPTS TO INDUCE, ANY MEMBER OR 2,638
OTHER PERSON TO BREACH A MARKETING AGREEMENT WITH A COOPERATIVE, 2,639
BY ACCEPTING OR RECEIVING FROM THE MEMBER OR OTHER PERSON, 2,640
PRODUCTS FOR SALE, MARKETING, MANUFACTURING, OR PROCESSING FOR 2,641
SALE, CONTRARY TO THE TERMS OF ANY MARKETING AGREEMENT OF WHICH
THE INTERFERING PERSON HAS KNOWLEDGE OR NOTICE, IS LIABLE TO THE 2,642
COOPERATIVE FOR DAMAGES CAUSED BY SUCH INTERFERENCE, AND THE 2,643
COOPERATIVE IS ENTITLED TO AN INJUNCTION AGAINST THE INTERFERING 2,644
PERSON TO PREVENT FURTHER BREACHES AND A MULTIPLICITY OF ACTIONS. 2,645
(D) ANY PERSON THAT VIOLATES OR THREATENS TO VIOLATE THIS 2,648
SECTION SHALL PAY TO THE COOPERATIVE THE COOPERATIVE'S REASONABLE 2,649
ATTORNEY'S FEES AND OTHER COSTS INCURRED BY THE COOPERATIVE IN 2,650
ANY LITIGATION OR PROCEEDING AT LAW OR IN EQUITY TO ENFORCE OR 2,651
DEFEND THE COOPERATIVE'S RIGHTS AND INTERESTS THAT ARE PROTECTED 2,652
UNDER THIS SECTION. 2,653
Sec. 1729.69. (A) IT SHALL BE UNLAWFUL FOR A HANDLER TO 2,655
COMMIT AN UNFAIR MARKETING PRACTICE, AS DEFINED IN DIVISION (B) 2,658
OF THIS SECTION, WHENEVER A MARKETING COOPERATIVE HAS BEEN 2,659
AUTHORIZED BY ITS MEMBERS TO BARGAIN ON BEHALF OF ITS MEMBERS FOR 2,660
SALES CONTRACTS WITH A HANDLER AND ANY OF THE FOLLOWING 2,662
CONDITIONS EXIST:
(1) MEMBERS OF THE MARKETING COOPERATIVE ARE OBLIGATED TO 2,664
PRODUCE AND DELIVER AGRICULTURAL PRODUCTS OR PRODUCE UNDER SALES 2,665
CONTRACTS NEGOTIATED BY THE MARKETING ASSOCIATION. 2,666
(2) MEMBERS OF THE MARKETING COOPERATIVE REPRESENT, ON THE 2,668
YEARLY AVERAGE CALCULATED OVER THE IMMEDIATE TWO PRECEDING 2,669
CALENDAR YEARS, AT LEAST FIFTY-ONE PER CENT OF THE PRODUCERS WHO 2,670
DELIVERED SUCH PRODUCTS OR PRODUCE TO THE SPECIFIED FACILITY OF 2,671
THE HANDLER UNDER SALES CONTRACTS.
67
(3) MEMBERS OF THE MARKETING COOPERATIVE DELIVERED, UNDER 2,673
SALES CONTRACTS, ON THE YEARLY AVERAGE CALCULATED OVER THE 2,674
IMMEDIATE TWO PRECEDING CALENDAR YEARS, AT LEAST FIFTY PER CENT 2,675
OF THE TOTAL AMOUNT OF SUCH AGRICULTURAL PRODUCTS DELIVERED TO 2,676
SUCH FACILITY UNDER SALES CONTRACTS.
(4) THE MARKETING COOPERATIVE, IF REQUESTED BY THE 2,678
HANDLER, PRESENTS TO THE HANDLER COPIES OF THE AGREEMENTS WITH 2,680
ITS MEMBERS AUTHORIZING THE MARKETING COOPERATIVE TO BARGAIN ON 2,681
BEHALF OF ITS MEMBERS FOR SALES CONTRACTS FOR THE AGRICULTURAL 2,682
PRODUCTS THAT ARE THE SUBJECT OF THE SALES CONTRACT UNDER
NEGOTIATION. 2,683
(B) FOR PURPOSES OF THIS SECTION, IT IS AN UNFAIR 2,686
MARKETING PRACTICE IF EITHER OF THE FOLLOWING APPLIES: 2,687
(1) IF THE HANDLER OR THE MARKETING COOPERATIVE THAT IS 2,689
BARGAINING FAILS TO BARGAIN IN GOOD FAITH IN NEGOTIATING SALES 2,690
CONTRACTS FOR AGRICULTURAL PRODUCTS TO BE DELIVERED TO A FACILITY 2,691
OF THE HANDLER;
(2) IF A HANDLER ENTERS INTO A SALES CONTRACT DIRECTLY 2,693
WITH A PRODUCER, PERTAINING TO AGRICULTURAL PRODUCTS TO BE 2,694
DELIVERED TO THE SAME FACILITY, WITH THE INTENT TO CAUSE THE 2,695
MARKETING COOPERATIVE TO FAIL TO MEET THE CONDITIONS SET FORTH IN 2,696
DIVISIONS (A)(2) AND (3) OF THIS SECTION.
Sec. 1729.70. (A) AN AGRICULTURAL COOPERATIVE IS NOT A 2,698
CONSPIRACY, A COMBINATION IN RESTRAINT OF TRADE, AN ILLEGAL 2,699
MONOPOLY, OR AN ATTEMPT TO LESSEN COMPETITION OR TO FIX PRICES 2,700
ARBITRARILY; AND THE MARKETING AGREEMENTS BETWEEN SUCH AN 2,701
AGRICULTURAL COOPERATIVE AND ITS MEMBERS, OR ANY OTHER MARKETING 2,702
AGREEMENTS OR SALES CONTRACTS AUTHORIZED OR DESCRIBED IN SECTIONS 2,703
1729.67 TO 1729.70 OF THE REVISED CODE, ARE NOT ILLEGAL AS SUCH,
IN UNLAWFUL RESTRAINT OF TRADE, OR PART OF A CONSPIRACY OR 2,704
COMBINATION TO ACCOMPLISH AN IMPROPER OR ILLEGAL PURPOSE. 2,705
(B) AN AGRICULTURAL COOPERATIVE, UPON RESOLUTION OF ITS 2,707
BOARD, MAY ENTER INTO MARKETING AGREEMENTS AND OTHER ARRANGEMENTS 2,709
WITH ANY OTHER AGRICULTURAL COOPERATIVE. ANY TWO OR MORE 2,711
68
AGRICULTURAL COOPERATIVES MAY, BY AGREEMENT BETWEEN THEM, UNITE 2,712
IN EMPLOYING OR SEPARATELY EMPLOY THE SAME PERSONNEL, METHODS, 2,713
MEANS, AND AGENCIES FOR CARRYING ON THEIR RESPECTIVE BUSINESSES. 2,714
AGRICULTURAL COOPERATIVES, ACTING SINGLY OR COLLECTIVELY, MAY
MEET IN CONFERENCE WITH TWO OR MORE PURCHASERS OF THEIR PRODUCTS 2,715
WHO ARE ACTING COLLECTIVELY, AND MAY AT THE CONFERENCE FIX BY 2,716
AGREEMENT THE PRICES TO BE PAID BY THE PURCHASERS TO THE 2,717
AGRICULTURAL COOPERATIVE FOR THE PRODUCTS. SUCH CONCERTED ACTION 2,718
BY THE PURCHASERS IS NOT A CONTRACT IN RESTRAINT OF TRADE. 2,719
Sec. 1729.25 1729.76. Any corporation or FOREIGN 2,729
association organized under laws of another state that are 2,730
generally similar to sections 1729.01 to 1729.27, inclusive of
the Revised Code, may carry on any proper activities in this 2,731
state upon compliance with the general regulations applicable to 2,732
foreign corporations desiring to do business in this state. All 2,733
contracts which THAT could be made by any association 2,735
incorporated under such sections, THIS CHAPTER AND that are made 2,736
by or with such foreign associations, shall be enforceable in 2,737
this state with all of the remedies set forth in such sections 2,738
THIS CHAPTER.
Sec. 1729.22 1729.80. An association may organize, form, 2,747
operate, own, control, have an interest in, own stock of, or be a 2,749
member of any other corporations engaged in preserving, drying, 2,751
processing, canning, packing, storing, handling, shipping, 2,752
utilizing, manufacturing, marketing, or selling the agricultural
products handled by the association or the by-products of such 2,753
products.
If such other corporations are warehousing corporations, 2,755
they may issue legal warehouse receipts to the association or to 2,757
any other person against commodities delivered to them, and such 2,758
legal warehouse receipts shall be considered an adequate 2,759
collateral to the extent of the usual and current value of the 2,760
commodity represented by them COOPERATIVE, CORPORATION, OR OTHER
FORM OF ORGANIZATION. 2,761
69
Sec. 1729.23 1729.84. Any law which is in conflict with 2,770
sections 1729.01 to 1729.27, inclusive, of the Revised Code, 2,772
shall be construed as not applying to the associations provided 2,773
for in such sections.
Any exemptions under any law applying to agricultural 2,775
products in the possession or under the control of the individual 2,776
producer shall also SHALL apply to such products delivered by its 2,778
farmer PRODUCER members, as long as such products are in the 2,780
possession or under the control of the association AN
AGRICULTURAL COOPERATIVE. 2,781
Sec. 1729.85. MEMBERSHIP STOCK AND PATRONAGE STOCK OF AN 2,783
ASSOCIATION ARE NOT TO BE CONSIDERED SECURITIES UNDER CHAPTER 2,785
1707. OF THE REVISED CODE.
Sec. 1729.86. (A) EXCEPT AS OTHERWISE PROVIDED IN THIS 2,787
CHAPTER, THIS CHAPTER APPLIES TO ALL ASSOCIATIONS, WHETHER 2,788
ORGANIZED UNDER THIS CHAPTER PRIOR TO THE EFFECTIVE DATE OF THIS 2,789
SECTION OR ON OR AFTER THAT DATE.
(B) ANY LAW THAT IS IN CONFLICT WITH THIS CHAPTER SHALL BE 2,791
CONSTRUED AS NOT APPLYING TO ASSOCIATIONS PROVIDED FOR IN THIS 2,792
CHAPTER.
Sec. 1729.99. (A) Whoever violates section 1729.181 2,801
1729.04 of the Revised Code shall be fined not less than fifty 2,802
FIVE HUNDRED nor more than five TWENTY-FIVE hundred dollars for 2,803
each offense. 2,805
(B) Whoever VIOLATES DIVISION (A) OF SECTION 1729.68 OR 2,807
commits an unfair marketing practice as defined in section 2,808
1729.192 1729.69 of the Revised Code shall be fined not less than 2,809
one FIVE hundred nor more than twenty-five hundred FIVE THOUSAND 2,811
dollars for each offense.
Sec. 4517.22. (A) Any group of licensed new motor vehicle 2,820
dealers may display motor vehicles at a motor vehicle show within 2,821
the general market area allocated to a licensed new motor vehicle 2,822
dealer, whenever all of the following conditions are met: 2,823
(1) The primary purpose of the motor vehicle show is the 2,825
70
exhibition of competitive makes and models of motor vehicles to 2,826
provide the general public the opportunity to review and inspect 2,827
various makes and models of motor vehicles at a single location; 2,828
(2) Not less than thirty days before the planned opening 2,830
date of the motor vehicle show, the group requests and receives 2,831
permission to hold the show from the registrar of motor vehicles. 2,832
(B) No contracts shall be signed, deposits taken, or sales 2,834
consummated at the location of a motor vehicle show. 2,835
(C) Any sponsor of a motor vehicle show shall offer by 2,837
mail an invitation to all new motor vehicle dealers dealing in 2,838
competitive types of motor vehicles in the general market area to 2,839
participate and display motor vehicles in the show. The sponsor 2,840
may offer a similar invitation to manufacturers or distributors. 2,841
A copy of each invitation shall be retained by the sponsor for at 2,842
least one year after the show.
(D) No person except a manufacturer or distributor shall 2,844
hold in any public place a motor vehicle show at which only one 2,845
motor vehicle is displayed, and no such single unit show shall be 2,846
held unless the manufacturer or distributor requests and receives 2,848
permission from the registrar not less than thirty days before 2,849
the show.
(E) The registrar shall not grant permission for any motor 2,851
vehicle show to be held, unless it is proven to his THE 2,852
REGISTRAR'S satisfaction that no attempt is being made to 2,854
circumvent the provisions of sections 4517.01 to 4517.45 of the
Revised Code. 2,855
(F) Nothing contained in this section shall be construed 2,857
as prohibiting the taking of orders for nonmotorized recreational 2,858
vehicles as defined in section 4501.01 of the Revised Code at 2,860
sports or camping shows. 2,861
(G) No motor vehicle dealer, motor vehicle leasing dealer, 2,863
motor vehicle auction owner, or distributor licensed under 2,864
sections 4517.01 to 4517.45 of the Revised Code shall display a 2,865
motor vehicle at any place except his THE DEALER'S, OWNER'S, OR 2,866
71
DISTRIBUTOR'S licensed location, unless he THE DEALER, OWNER, OR 2,867
DISTRIBUTOR first obtains permission from the registrar and 2,868
complies with the applicable rules of the motor vehicle dealers 2,869
board.
(H) NOTHING CONTAINED IN THIS SECTION SHALL BE CONSTRUED 2,871
AS PROHIBITING THE DISPLAY OF, THE TAKING OF ORDERS FOR, OR THE 2,872
SALE OF, LIVESTOCK TRAILERS AT LIVESTOCK AND AGRICULTURAL SHOWS, 2,873
INCLUDING COUNTY FAIRS. NOTWITHSTANDING SECTION 4517.03 OF THE 2,874
REVISED CODE, LIVESTOCK TRAILERS MAY BE SOLD AT LIVESTOCK AND
AGRICULTURAL SHOWS, INCLUDING COUNTY FAIRS, AS PERMITTED BY THIS 2,875
DIVISION.
AS USED IN THIS DIVISION, "LIVESTOCK TRAILER" MEANS A NEW 2,877
OR USED TRAILER DESIGNED BY ITS MANUFACTURER TO BE USED TO 2,878
TRANSPORT HORSES OR TO TRANSPORT ANIMALS GENERALLY USED FOR FOOD 2,880
OR IN THE PRODUCTION OF FOOD, INCLUDING CATTLE, SHEEP, GOATS, 2,881
RABBITS, POULTRY, SWINE, AND ANY OTHER ANIMALS INCLUDED BY THE
DIRECTOR OF AGRICULTURE IN RULES ADOPTED UNDER SECTION 901.72 OF 2,882
THE REVISED CODE.
(I) Notwithstanding division (B) of this section, 2,884
contracts may be signed, deposits taken, and sales consummated at 2,885
the location of a motor vehicle show where the motor vehicles 2,886
involved are horse trailers or towing vehicles that are trucks 2,887
and have a gross vehicle weight of more than three-quarters of a 2,888
ton, the motor vehicle show is being held as part of or in 2,889
connection with a major livestock show, the licensed new motor
vehicle dealers involved have complied with the applicable 2,891
requirements of this section, and the registrar has granted 2,892
permission for the motor vehicle show in accordance with division 2,893
(E) of this section.
As used in division (H)(I) of this section: 2,895
(1) "Major livestock show" means any show of livestock 2,897
that is held at the Ohio state fairgrounds, is national in scope, 2,899
and that continues for more than ten consecutive days. 2,900
(2) "Truck" has the same meaning as in section 4511.01 of 2,902
72
the Revised Code.
(3) "Gross vehicle weight" means the unladen weight of the 2,904
vehicle fully equipped. 2,905
Section 2. That existing sections 917.01, 917.16, 1707.02, 2,908
1729.02, 1729.03, 1729.05, 1729.07, 1729.15, 1729.16, 1729.22, 2,909
1729.23, 1729.25, 1729.99, and 4517.22 and sections 1729.01, 2,910
1729.04, 1729.06, 1729.08, 1729.09, 1729.10, 1729.11, 1729.12, 2,911
1729.13, 1729.14, 1729.17, 1729.18, 1729.181, 1729.19, 1729.191, 2,912
1729.192, 1729.20, 1729.21, 1729.24, 1729.26, 1729.27, 1729.28, 2,913
1729.30, 1729.31, 1729.32, 1729.33, 1729.34, 1729.35, 1729.36, 2,914
and 1729.37 of the Revised Code are hereby repealed. 2,915