As Reported by the Senate Agriculture Committee 1
122nd General Assembly 4
Regular Session Am. H. B. No. 600 5
1997-1998 6
REPRESENTATIVES HOUSEHOLDER-CAREY-GRENDELL-REID-OGG-BUCHY- 8
GARCIA-GARDNER-PADGETT-HAINES-LOGAN-TERWILLEGER-HARRIS- 9
METZGER-VESPER-WESTON-ROMAN-WILLAMOWSKI-OPFER-SULZER-WILSON- 10
STAPLETON-KREBS-SAWYER-VERICH-JOHNSON-LUCAS-ROBERTS-YOUNG- 11
SENATOR WHITE 12
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A B I L L
To amend sections 917.01, 917.16, 1707.02, 1729.02, 16
1729.03, 1729.05, 1729.07, 1729.15, 1729.16, 17
1729.22, 1729.23, 1729.25, 1729.99, and 4517.22; 18
to amend, for the purpose of adopting new 19
section numbers as indicated in parentheses, 20
sections 1729.05 (1729.06), 1729.07 (1729.08), 22
1729.15 (1729.27), 1729.16 (1729.28), 1729.22 23
(1729.80), 1729.23 (1729.84), and 1729.25 24
(1729.76); to enact new sections 1729.01, 26
1729.04, 1729.07, 1729.09, 1729.10, 1729.11, 28
1729.12, 1729.13, 1729.14, 1729.16, 1729.17, 29
1729.18, 1729.19, 1729.20, 1729.22, 1729.23, 30
1729.24, 1729.25, 1729.26, 1729.35, 1729.36, and 32
1729.37 and sections 1729.29, 1729.38, 1729.40, 33
1729.42, 1729.44, 1729.46, 1729.47, 1729.49, 34
1729.55, 1729.56, 1729.58, 1729.59, 1729.60, 36
1729.61, 1729.67, 1729.68, 1729.69, 1729.70, 38
1729.85, and 1729.86; and to repeal sections 39
1729.01, 1729.04, 1729.06, 1729.08, 1729.09, 40
1729.10, 1729.11, 1729.12, 1729.13, 1729.14, 43
1729.17, 1729.18, 1729.181, 1729.19, 1729.191, 44
1729.192, 1729.20, 1729.21, 1729.24, 1729.26, 46
1729.27, 1729.28, 1729.30, 1729.31, 1729.32, 47
1729.33, 1729.34, 1729.35, 1729.36, and 1729.37 49
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of the Revised Code to establish the "Ohio 50
Cooperative Law" by revising the agricultural 52
cooperative law, by repealing the law governing 53
consumers' and worker-owned cooperatives, and by 55
enacting provisions for mergers, consolidations, 56
divisions, and dissolutions of cooperatives, and 57
to permit livestock trailers to be displayed and 58
sold at livestock and agricultural shows. 59
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO: 61
Section 1. That sections 917.01, 917.16, 1707.02, 1729.02, 63
1729.03, 1729.05, 1729.07, 1729.15, 1729.16, 1729.22, 1729.23, 64
1729.25, 1729.99, and 4517.22 be amended; sections 1729.05 65
(1729.06), 1729.07 (1729.08), 1729.15 (1729.27), 1729.16 66
(1729.28), 1729.22 (1729.80), 1729.23 (1729.84), and 1729.25 67
(1729.76) be amended for the purpose of adopting new section 68
numbers as indicated in parentheses; and new sections 1729.01, 69
1729.04, 1729.07, 1729.09, 1729.10, 1729.11, 1729.12, 1729.13, 70
1729.14, 1729.16, 1729.17, 1729.18, 1729.19, 1729.20, 1729.22, 71
1729.23, 1729.24, 1729.25, 1729.26, 1729.35, 1729.36, and 1729.37 72
and sections 1729.29, 1729.38, 1729.40, 1729.42, 1729.44, 73
1729.46, 1729.47, 1729.49, 1729.55, 1729.56, 1729.58, 1729.59, 74
1729.60, 1729.61, 1729.67, 1729.68, 1729.69, 1729.70, 1729.85, 75
and 1729.86 of the Revised Code be enacted to read as follows: 76
Sec. 917.01. As used in this chapter: 85
(A) "Person" means any individual, government agency, 87
political subdivision, partnership, corporation, affiliate or 89
subsidiary of a corporation, association, co-operative 90
association, or other business unit. 91
(B) "Co-operative association" OR "AGRICULTURAL 93
COOPERATIVE ASSOCIATION" means any association AGRICULTURAL 95
COOPERATIVE organized under sections 1729.01 to 1729.27 CHAPTER 96
1729. of the Revised Code, or under the "Co-operative Marketing 99
Associations (Capper-Volstead) Act," 7 U.S.C. 291, 292 (1980), as 101
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amended, and qualified to do business in Ohio, if the director of 102
agriculture finds the association has, in good faith, its entire 103
activities under the control of its members and has been and is 104
exercising full authority in the sale of milk or cream for its
members. 105
(C) "Market area" means any area that the director finds 108
is a natural marketing area and designates as such. 110
(D) "Dealer" or "milk dealer" means a person who purchases 113
or receives milk from a producer for the purpose of bottling, 116
packaging, selling, processing, jobbing, brokering, or 117
distributing the milk except where the milk is disposed of in the 119
same container in which it is received, without removal from the 121
container and without processing in any way except by necessary 123
refrigeration. Any person who buys and distributes milk in 124
containers under the person's own label is a dealer.
(E) "Imitation" means imitation as described in 21 C.F.R. 128
101.3, as amended. 129
(F) "Milk" means the lacteal secretion, substantially free 132
from colostrum, obtained by the complete milking of one or more 133
healthy cows, goats, sheep, or other animals and intended for 134
either of the following purposes: 135
(1) To be sold for human consumption or for use in dairy 138
products;
(2) To be used for human consumption or for use in dairy 141
products on the premises of a governmental agency or institution. 142
"Milk" does not include a blend of the lacteal secretions 144
of different species. 145
(G) "Grade A milk" means milk produced by a person holding 148
a valid producer license of the grade A milk category issued
pursuant to section 917.09 of the Revised Code. 151
(H) "Manufacture milk" means milk produced by a person 154
holding a valid producer license of the manufacture milk category 155
issued pursuant to section 917.09 of the Revised Code. 157
(I) "Producer" or "milk producer" means a grade A milk 160
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producer or a manufacture milk producer. 161
(J) "Grade A milk producer" means a person located in this 164
state who sells or offers for sale grade A milk obtained from a
cow, goat, sheep, or other animal that the person owns or 165
controls. 166
(K) "Manufacture milk producer" means a person located in 169
this state who sells or offers for sale manufacture milk obtained 170
from a cow, goat, sheep, or other animal that the person owns or 171
controls.
(L) "Grade A milk products" means products derived from 174
grade A milk and having the standard of identity, quality, 175
strength, purity, grade, and, if added, permitted optional 176
ingredients found in the standards of identity established for 177
the products in rules adopted by the director under section 178
917.02 or 3715.02 of the Revised Code, and includes: 180
(1) Cottage cheese; 182
(2) Raw, pasteurized, or aseptically processed products 185
derived from milk and described in either of the following:
(a) The most recent published recommendations of the food 188
and drug administration, public health service, United States 190
department of health and human services; 191
(b) Rules adopted by the director. 194
(M) "Manufactured milk products" means all products, other 197
than raw milk for sale to the ultimate consumer and grade A milk 198
products, that are derived from milk and are for human 199
consumption, including:
(1) Butter; 201
(2) Natural or processed cheese; 203
(3) Evaporated, condensed, and dry products; 205
(4) Frozen desserts; 207
(5) Such other products derived from milk as the director 209
may specify by rule that have the standard of identity, quality, 210
strength, purity, grade, and, if added, permitted optional 211
ingredients found in the standards of identity established for 212
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the product in rules adopted by the director under section 917.02 213
or 3715.02 of the Revised Code. 215
(N) "Dairy products" means milk, raw milk for sale to the 218
ultimate consumer, grade A milk products, and manufactured milk 219
products.
(O) "Frozen desserts" means frozen desserts, including the 222
mixes, described in 21 C.F.R. 135, as amended, unless otherwise 224
specified by the director by rule. 225
(P) "Milk plant" means a grade A milk plant or manufacture 229
milk plant.
(Q) "Grade A milk plant" means a place, including a 232
governmental operation, where grade A milk or a grade A milk
product is collected, handled, controlled, processed, stored, 233
pasteurized, ultra-pasteurized, repasteurized, aseptically 234
processed, bottled, or prepared for distribution, but does not 235
include a place where a grade A milk product is purchased in 236
packaged form and is stored and handled for the sole purpose of 237
sale to the ultimate consumer.
(R) "Manufacture milk plant" means a place, including a 240
governmental operation, where manufacture milk or a manufactured 241
milk product is collected, handled, controlled, manufactured, 242
processed, stored, pasteurized, ultra-pasteurized, repasteurized, 243
commercially sterilized, aseptically processed, bottled, or 244
prepared for distribution, but does not include a place where a 245
manufactured milk product is purchased in packaged form and is 246
stored and handled for the sole purpose of sale to the ultimate 247
consumer. 248
(S) "Raw milk for sale to the ultimate consumer" means the 251
raw milk sold or offered for sale by a raw milk retailer. 252
(T) "Raw milk retailer" means a person who, prior to 255
October 31, 1965, was engaged continuously in the business of 257
selling or offering for sale raw milk directly to ultimate 258
consumers.
(U) "Processor" or "milk processor" means a grade A milk 261
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processor or a manufacture milk processor. 262
(V) "Grade A milk processor" means a person who operates 266
or controls a milk plant that is located in this state or from 267
which grade A milk or grade A milk products are sold or offered 270
for sale for human consumption.
(W) "Manufacture milk processor" means any person who 272
operates or controls a manufacture milk plant that is located in 273
this state or from which manufacture milk or manufactured milk 274
products are sold or offered for sale for human consumption. 275
(X) "Weigher, sampler, or tester" means a person who, in 278
order to determine volume, weight, or composition for the purpose 279
of determining price, weighs, tests, or samples either of the 280
following:
(1) Milk at a dairy farm; 282
(2) Milk or cream purchased by a dealer from a milk 284
producer or co-operative association. 285
(Y) "Hauler" or "milk hauler" means a person who owns or 288
leases a vehicle or conveyance used to transport raw milk, but 289
does not include a producer transporting raw milk that the 290
producer has produced. 291
(Z) "License" means a license issued under section 917.09 294
of the Revised Code and includes a registration issued under 296
division (I) of that section. 297
Sec. 917.16. (A) This chapter shall not restrain, limit, 307
prejudice, abrogate, or take from any co-operative association 309
AGRICULTURAL COOPERATIVE ASSOCIATION the powers, privileges, and 310
rights it has under sections 1729.01 to 1729.27 CHAPTER 1729. of 312
the Revised Code.
(B) Specifically, but without limiting division (A) of 314
this section, this chapter shall not derogate from or prejudice 317
any rights of any co-operative association, provided that the 318
association and its employees comply with the licensing 319
requirements.
Sec. 1707.02. (A) "Exempt," as used in this section, 329
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means exempt from sections 1707.08 to 1707.11 and 1707.39 of the 330
Revised Code. 331
(B)(1) Except as provided in division (B)(2) of this 333
section, the following securities are exempt, if the issuer or 334
guarantor has the power of taxation or assessment for the purpose 335
of paying the obligation represented by the security, or is in 336
specific terms empowered by the laws of the state of issuance to 337
issue securities payable as to principal or interest, or as to 338
both, out of revenues collected or administered by such issuer: 339
(a) Any security issued or guaranteed by the United 341
States; 342
(b) Any security issued or guaranteed by, and recognized, 344
at the time of sale, as its valid obligation by, any foreign 345
government with which the United States is, at the time of sale, 346
maintaining diplomatic relations; 347
(c) Any security issued or guaranteed, and recognized as 349
its valid obligation, by any political subdivision or any 350
governmental or other public body, corporation, or agency in or 351
of the United States, any state, territory, or possession of the 352
United States, or any foreign government with which the United 353
States is, at the time of sale, maintaining diplomatic relations. 354
(2) If a security described in division (B)(1) of this 356
section is not payable out of the proceeds of a general tax, the 358
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 360
or principal of the security, and there are no adjudications or 361
pending suits adversely affecting its validity. 362
(C) Any security issued by and representing an interest in 364
or an obligation of a state or nationally chartered bank, savings 365
and loan association, savings bank, or credit union, or a 367
governmental corporation or agency created by or under the laws 368
of the United States or of Canada is exempt, if it is under the 369
supervision of or subject to regulation by the government or 370
state under whose laws it was organized.
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(D) Any interim certificate is exempt, if the securities 372
to be delivered therefor are themselves exempt, are the subject 373
matter of an exempt transaction, have been registered by 374
description or registered by qualification, or are the subject 375
matter of a transaction which has been registered by description. 376
(E)(1) Any security, whether a preliminary or final 378
security, is exempt, which, at the time of sale within this 379
state, is listed, or listed upon notice of issuance, on the 380
Cincinnati stock exchange, the Midwest stock exchange, the New 381
York stock exchange, or the American stock exchange, or is 382
designated, or approved for designation upon notice of issuance, 383
as a national market system security on the national association 384
of securities dealers automated quotation system, or is listed or 385
designated on any other stock exchange or national quotation 386
system approved by the division as having listing requirements 387
substantially equivalent to those of any one of those exchanges 388
or systems, and any security senior to any security so listed or 389
designated is also exempt; but these exemptions shall apply only 390
so long as such security remains so listed or designated pursuant 391
to official action of such exchange or system and not under 392
suspension, and only so long as such exchange or system remains 393
approved under this section. 394
(2) Application for approval of a stock exchange or system 396
not approved in this section may be made by any organized stock 397
exchange or system, or by any dealer who is a member of such 398
exchange, in such manner and upon such forms as are prescribed by 399
the division, accompanied by payment of an approval fee of two 400
hundred dollars, and the division shall make such investigation 401
and may hold such hearings as it deems necessary to determine the 402
propriety of giving approval. The cost of such investigation 403
shall be borne by the applicant. The division may enter an order 404
of approval, and if it does so, it shall notify the applicant of 405
such approval. 406
(3) The division may revoke the approval of an exchange or 408
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system approved in this section or approved by it upon finding, 409
after due notice, investigation, and hearing, that the practices 410
or requirements of such exchange or system have been so changed 411
or modified, or are, in their actual operation, such that the 412
contemplated protection is no longer afforded. The principles of 413
res adjudicata ordinarily applicable in civil matters shall not 414
be applicable to this matter, which is hereby declared to be 415
administrative rather than judicial. Notice of the hearing may 416
be given by certified mail at least ten days before such hearing. 417
(4) The division may suspend the exemption of any security 419
described in division (E) of this section by giving notice, by 420
certified mail, to that effect to the exchange or system upon 421
which such security is listed or designated and to the issuer of 422
such security. After notice and hearing, the division may revoke 423
such exemption if it appears to it that sales of such security 424
have been fraudulent or that future sales of it would be 425
fraudulent. The division shall set such hearing not later than 426
ten days from the date of the order of suspension, but may for 427
good cause continue such hearing upon application of the exchange 428
or system upon which such security is listed or designated or 429
upon application of the issuer of such security. 430
(F) Any security, issued or guaranteed as to principal, 432
interest, or dividend or distribution by a corporation owning or 433
operating any public utility, is exempt, if such corporation is, 434
as to its rates and charges or as to the issuance and 435
guaranteeing of securities, under the supervision of or regulated 436
by a public commission, board, or officer of the United States, 437
or of Canada, or of any state, province, or municipal corporation 438
in either of such countries. Equipment-trust securities based on 439
chattel mortgages, leases, or agreements for conditional sale, of 440
cars, locomotives, motor trucks, or other rolling stock or of 441
motor vehicles mortgaged, leased, or sold to, or finished for the 442
use of, a public utility, are exempt; and so are equipment 443
securities where the ownership or title of such equipment is 444
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pledged or retained, in accordance with the laws of the United 445
States or of any state, or of Canada or any province thereof, to 446
secure the payment of such securities. 447
(G) Commercial paper and promissory notes are exempt when 449
they are not offered directly or indirectly for sale to the 450
public. 451
(H) Any security issued or guaranteed by an insurance 453
company, except as provided in section 1707.32 of the Revised 454
Code, is exempt if such company is under the supervision of, and 455
the issuance or guaranty of such security is regulated by, a 456
state. 457
(I) Any security, except notes, bonds, debentures, or 459
other evidences of indebtedness or of promises or agreements to 460
pay money, which is issued by a person, corporation, or 461
association organized not for profit, including persons, 462
corporations, and associations organized exclusively for 463
conducting county fairs, for cooperative marketing, or for 466
religious, educational, social, recreational, athletic, 467
benevolent, fraternal, charitable, or reformatory purposes, AND 468
AGRICULTURAL COOPERATIVES AS DEFINED IN SECTION 1729.01 OF THE 469
REVISED CODE, is exempt, if no part of the net earnings of such 471
issuer inures to the benefit of any shareholder or member of such 472
issuer or of any individual, and if the total commission, 473
remuneration, expense, or discount in connection with the sale of 474
such securities does not exceed two per cent of the total sale 475
price thereof plus five hundred dollars. 476
(J)(1) Any securities outstanding for a period of not less 478
than five years, on which there has occurred no default in 479
payment of principal, interest, or dividend or distribution for 480
the five years immediately preceding the sale, are exempt. 481
(2) For the purpose of division (J) of this section, the 483
dividend, distribution, or interest rate on securities in which 484
no such rate is specified shall be at the rate of at least four 485
per cent annually on the aggregate of the price at which such 486
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securities are to be sold. 487
(K) All bonds issued under authority of Chapter 165. or 489
761., or section 4582.06 or 4582.31 of the Revised Code are 490
exempt. 491
Sec. 1729.01. AS USED IN THIS CHAPTER: 493
(A) "AGRICULTURAL COOPERATIVE" MEANS A COOPERATIVE TO 495
WHICH ALL OF THE FOLLOWING APPLY: 496
(1) THE COOPERATIVE ENGAGES IN ANY ACTIVITY IN CONNECTION 498
WITH THE PROPAGATION, RAISING, PRODUCING, HARVESTING, STORING, 499
DRYING, HANDLING, PROCESSING, OR MARKETING OF AGRICULTURAL 501
PRODUCTS; PROCURING EQUIPMENT AND SUPPLIES OR PROVIDING SERVICES
FOR PRODUCERS AND OTHERS; BARGAINING; AND ANY ACTIVITY RELATED TO 502
THE FOREGOING. 503
(2) PRODUCERS OR AGRICULTURAL COOPERATIVES EXERCISE MORE 505
THAN FIFTY PER CENT OF THE VOTING CONTROL OF THE COOPERATIVE. 506
(3) THE COOPERATIVE DOES AT LEAST FIFTY PER CENT OF ITS 508
BUSINESS WITH PRODUCERS OR AGRICULTURAL COOPERATIVES. 509
(B) "AGRICULTURAL PRODUCTS" INCLUDES AQUACULTURAL, 511
HORTICULTURAL, VITICULTURAL, FORESTRY, DAIRY, LIVESTOCK, POULTRY, 513
BEE, AND FARM PRODUCTS, AND THE PRODUCE OR BYPRODUCTS OF ANY OF 515
SUCH PRODUCTS.
(C) "ASSOCIATION" MEANS ANY CORPORATION ORGANIZED UNDER 517
THIS CHAPTER. 518
(D) "BARGAINING" MEANS THE MUTUAL OBLIGATION OF A HANDLER 520
AND A MARKETING COOPERATIVE TO MEET AT REASONABLE TIMES AND 521
CONFER AND NEGOTIATE IN GOOD FAITH. NEGOTIATIONS MAY INCLUDE ALL 522
TERMS RELATIVE TO TRADING BETWEEN HANDLERS AND PRODUCERS. THE 523
OBLIGATION DOES NOT REQUIRE EITHER PARTY TO AGREE UPON PRICE, 524
TERMS OF SALE, OR ANY OTHER MARKETING AGREEMENT, OR TO MAKE A
CONCESSION. 525
(E) "BOARD" MEANS THE BOARD OF DIRECTORS OF AN 527
ASSOCIATION. 528
(F) "COOPERATIVE" MEANS AN ASSOCIATION OR A FOREIGN 530
ASSOCIATION.
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(G) "CORPORATION" MEANS ANY CORPORATION, DOMESTIC OR 532
FOREIGN, THAT IS NOT A COOPERATIVE. 533
(H) "ENTITY," EXCEPT AS OTHERWISE PROVIDED, MEANS A FOREIGN 536
ASSOCIATION, A CORPORATION, OR A FOREIGN OR DOMESTIC LIMITED 537
LIABILITY COMPANY.
(I) "FOREIGN ASSOCIATION" MEANS A CORPORATION ORGANIZED 539
UNDER THE COOPERATIVE LAWS OF ANOTHER STATE OR THE DISTRICT OF 541
COLUMBIA OR A CORPORATION ORGANIZED UNDER THE LAW OF ANOTHER
STATE OR THE DISTRICT OF COLUMBIA AND OPERATING ON A COOPERATIVE 542
BASIS. 543
(J) "HANDLER" MEANS A PERSON WHO ACQUIRES AGRICULTURAL 545
PRODUCTS UNDER A SALES CONTRACT FOR THE PURPOSE OF PROCESSING OR 546
RESELLING THE AGRICULTURAL PRODUCTS. 547
(K) "MARKETING AGREEMENT" MEANS AN AGREEMENT, CONTRACT, OR 549
OTHER ARRANGEMENT BETWEEN A COOPERATIVE AND A MEMBER IN WHICH THE 550
MEMBER AGREES TO MARKET ALL OR A PART OF THE PRODUCTS OR PRODUCE 551
PRODUCED BY THE MEMBER, OR AGREES TO PURCHASE ALL OR A PART OF 552
THE MEMBER'S REQUIREMENTS FOR INPUTS, SERVICES, OR SUPPLIES. 553
(L) "MARKETING COOPERATIVE" MEANS ANY AGRICULTURAL 555
COOPERATIVE MEETING THE REQUIREMENTS OF THE "CO-OPERATIVE 556
MARKETING ASSOCIATIONS ACT," 42 STAT. 388 (1922), 7 U.S.C.A. 291, 558
THAT NEGOTIATES SALES CONTRACTS WITH HANDLERS ON BEHALF OF ITS
MEMBERS AND IS NOT IN DIRECT COMPETITION WITH ANY HANDLER WITH 559
WHICH IT NEGOTIATES SUCH CONTRACTS. 560
(M) "MEMBER" MEANS A PERSON WHO HAS BEEN QUALIFIED AND 562
ACCEPTED INTO MEMBERSHIP IN AN ASSOCIATION. 563
(N) "MEMBERSHIP STOCK" MEANS ANY CLASS OF STOCK OR OTHER 565
EQUITY INTEREST IN AN ASSOCIATION, CONTINUOUS OWNERSHIP OF WHICH 566
IS REQUIRED FOR MEMBERSHIP IN AN ASSOCIATION. 567
(O) "PATRONAGE STOCK" MEANS ANY STOCK OR OTHER EQUITY 569
INTEREST IN AN ASSOCIATION THAT WAS ORIGINALLY ISSUED BY THE 570
ASSOCIATION WITH RESPECT TO PATRONAGE TRANSACTIONS. 571
(P) "PERSON" INCLUDES A NATURAL PERSON, PARTNERSHIP, 573
CORPORATION, COOPERATIVE, OR OTHER ENTITY. 574
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(Q) "PROCESSING" MEANS CHANGING THE PHYSICAL OR CHEMICAL 576
CHARACTERISTICS OF AGRICULTURAL PRODUCTS. 577
(R) "PRODUCER" MEANS A PERSON ENGAGED IN THE PRODUCTION OF 580
AGRICULTURAL PRODUCTS FOR THE MARKET, INCLUDING A LESSOR OF LAND
WHO RECEIVES AS RENT PART OF THE AGRICULTURAL PRODUCT OF SUCH 581
LAND.
(S) "SALES CONTRACT" MEANS A MARKETING AGREEMENT OR OTHER 583
SIMILAR ARRANGEMENT BETWEEN A HANDLER AND A PRODUCER, NEGOTIATED 585
BY THE PRODUCER OR BY AN AGRICULTURAL COOPERATIVE ACTING AS AGENT 586
FOR A PRODUCER, UNDER WHICH THE PRODUCER AGREES TO GROW OR
PRODUCE AGRICULTURAL PRODUCTS FOR SALE TO THE HANDLER. 587
Sec. 1729.02. (A) An association may be organized to 596
engage in any activity in connection with the marketing or 598
selling of the agricultural products of its members, with the 599
harvesting, preserving, drying, processing, canning, packing, 600
grading, storing, handling, shipping, or utilization of such
products, or with the manufacturing or marketing of the 601
by-products of such products; to engage in any activity in 602
connection with the manufacturing, selling, or supplying to its 603
members of machinery, equipment, or supplies of any kind; to 604
engage in services in connection with activities authorized by
sections 1729.01 to 1729.27, inclusive, of the Revised Code; or 605
to engage in the financing of the activities enumerated in this 606
section. Such association may be organized to engage in any one 607
or more of such activities, but this UNDER THIS CHAPTER FOR ANY 608
LAWFUL PURPOSE PERMITTED TO CORPORATIONS BY THE LAWS OF THIS 609
STATE, EXCEPT ANY SUCH PURPOSE THAT IS INCONSISTENT WITH THE 610
PROVISIONS OF THIS CHAPTER OR OTHER CHAPTERS OF TITLE XVII OF THE 612
REVISED CODE. THIS section does not authorize any professional 613
services otherwise prohibited by law. 614
(B) ASSOCIATIONS SHALL BE DEEMED NONPROFIT BECAUSE THEY 616
ARE NOT ORGANIZED FOR THE PURPOSE OF MAKING A PROFIT FOR 617
THEMSELVES AS SUCH, OR FOR THE PURPOSE OF MAKING A PROFIT FOR 618
THEIR MEMBERS AS SUCH, BUT FOR THEIR MEMBERS AS PATRONS. 619
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(C) THIS CHAPTER SHALL BE KNOWN AS THE "OHIO COOPERATIVE 622
LAW."
Sec. 1729.03. Each association incorporated under sections 631
1729.01 to 1729.27, inclusive, of the Revised Code THIS CHAPTER 632
shall have the following powers: 633
(A) It may engage in any activity in connection with the 635
marketing, selling, preserving, harvesting, drying, processing, 637
manufacturing, canning, packing, grading, storing, handling, or 638
utilization of any agricultural products produced or delivered to 639
it by its members or others, or with the manufacturing or 640
marketing of the by-products of such products; any activities in 641
connection with the purchase, sale, hiring, or use, by its
members or others, of supplies, machinery, or equipment of any 642
kind; may engage in services in connection with any activities 643
authorized by sections 1729.01 to 1729.27, inclusive, of the 644
Revised Code, or may engage in the financing of such activities. 645
Such association may engage in any one or more of the activities 646
specified in this section but this section does not authorize any
professional services otherwise prohibited by law. 647
Any such association may limit its activities to the 649
handling or the marketing of products of its own members, except 651
for storage. If it handles the products of nonmembers, the total 652
of such nonmembers' products handled by it in any fiscal year 653
must not exceed the total of similar products handled by the 654
association for its own members during the same period.
(B) It may borrow money without limitation as to amount of 656
corporate indebtedness or liability except in the case of 657
associations organized with capital stock, and may make advance 658
payments and other advances to members or others. 659
(C) It may act as the agent or representative of any 661
members in any of the activities mentioned in divisions (A) and 662
(B) of this section.
(D) It may purchase, otherwise acquire, hold, own, 664
exercise all rights of ownership in, sell, transfer, pledge, 665
15
guarantee the payment of dividends or interest on, or guarantee 666
the retirement or redemption of shares of capital stock or bonds 667
of any corporation or association engaged in any activity
directly related to the association's own authorized activities 668
or in the warehousing, handling, or marketing of any of the 669
products handled by the association. 670
(E) It may establish reserves and invest the funds thereof 672
in bonds or in such other property as is provided in the bylaws 673
MAKE CONTRACTS, INCUR LIABILITIES, AND BORROW MONEY; ISSUE 674
CAPITAL STOCK AND CERTIFICATES REPRESENTING EQUITY INTERESTS OR 676
INDEBTEDNESS; ACQUIRE PROPERTY; AND DISPOSE OF, MORTGAGE, PLEDGE, 677
LEASE, OR OTHERWISE USE IN ANY MANNER, ANY OF ITS PROPERTY, OR 678
ANY INTEREST IN ITS PROPERTY, WHEREVER SITUATED.
(B) IT MAY INVEST ITS FUNDS, LEND MONEY FOR ITS PURPOSES, 680
AND HOLD ANY PROPERTY AS SECURITY FOR REPAYMENT. 681
(C) IT MAY ACT AS THE AGENT OR REPRESENTATIVE OF ANY 683
MEMBERS IN ANY ACTIVITIES AUTHORIZED BY THIS CHAPTER. 684
(D) IT MAY CONDUCT ITS BUSINESS AND AFFAIRS, HAVE OFFICES, 686
AND EXERCISE ITS POWER IN THE UNITED STATES OR IN ANY FOREIGN 687
COUNTRY. 688
(E) IT MAY ESTABLISH RESERVES AND INVEST THESE FUNDS. 690
(F) It may buy, hold, and exercise all privileges of 692
ownership over such real or personal property as is necessary, 693
convenient, or incidental to the conduct of any authorized 694
business of the association.
(G) It may establish, secure, own, and develop patents, 696
trademarks, and copyrights. 697
(H) NOTWITHSTANDING CHAPTER 169. OF THE REVISED CODE, IT 700
MAY EFFECT THE FORFEITURE OF ANY UNCLAIMED FUNDS, INCLUDING ANY 701
UNCLAIMED STOCKS OR OTHER EQUITY INTERESTS, DIVIDENDS, AND 702
PATRONAGE ALLOCATIONS, FOR WHICH THE OWNER CANNOT BE FOUND AFTER 704
A PERIOD OF THREE YEARS. NOTICE OF THE EXISTENCE OF THESE 705
UNCLAIMED FUNDS AND A REQUEST FOR WRITTEN ACKNOWLEDGMENT FROM THE
OWNER TO THE ASSOCIATION SHALL BE EVIDENCE OF A BONA FIDE ATTEMPT 706
16
TO DELIVER THE UNCLAIMED FUNDS TO THE OWNER. IF THE NOTICE IS 707
NOT ACKNOWLEDGED WITHIN THIRTY DAYS AFTER THE NOTICE IS SENT OR 708
WITHIN THE PERIOD SPECIFIED IN THE NOTICE, IF LONGER, ALL SUCH 709
UNCLAIMED FUNDS SPECIFIED IN THE NOTICE ARE THEREAFTER FORFEITED 710
AND BECOME THE PROPERTY OF THE ASSOCIATION.
(I) IT MAY MAKE DONATIONS FOR CHARITABLE, SCIENTIFIC, 712
EDUCATIONAL, COMMUNITY DEVELOPMENT, OR RELIGIOUS PURPOSES, AND 713
MAY USE ALL OR PART OF THE FUNDS FORFEITED TO THE ASSOCIATION 714
UNDER DIVISION (H) FOR THESE PURPOSES. 715
(J) It may do everything necessary, suitable, or proper 717
for the accomplishment of any of the purposes enumerated in this 718
section, or conducive to or expedient for the interest or benefit 720
of the association, and may contract accordingly. In addition it 721
may exercise and possess all powers, rights, and privileges 722
necessary or incidental to the purposes for which the association 723
is organized or to the activities in which it is engaged, and
also any other powers, rights, and privileges granted to ordinary 725
corporations by the laws of this state, except such as are 727
inconsistent with the express provisions of sections 1729.01 to 728
1729.27, inclusive, of the Revised Code, it may do any such thing 730
anywhere THIS CHAPTER.
Sec. 1729.04. (A) THE NAME OF ANY ASSOCIATION ORGANIZED 732
UNDER THIS CHAPTER SHALL INCLUDE THE WORD OR ABBREVIATION 733
"COOPERATIVE," "COOP," "CO-OPERATIVE," "CO-OP," "ASSOCIATION," 735
"ASSN.," "COMPANY," "CO.," "INCORPORATED," "INC.," "CORPORATION," 736
OR "CORP."
(B) NO CORPORATION, ASSOCIATION, OR OTHER PERSON ORGANIZED 738
OR APPLYING TO DO BUSINESS IN THIS STATE SHALL USE THE WORD OR 739
ABBREVIATION "COOPERATIVE," "COOP," "CO-OPERATIVE," OR "CO-OP" AS 741
A PART OF ITS CORPORATE OR OTHER BUSINESS NAME OR TITLE, UNLESS 742
AT LEAST ONE OF THE FOLLOWING APPLIES: 743
(1) IT HAS COMPLIED WITH THIS CHAPTER. 745
(2) IT IS ORGANIZED AND OPERATING ON A COOPERATIVE BASIS 748
UNDER CHAPTER 1702. OF THE REVISED CODE. 749
17
(3) IT IS ORGANIZED AND OPERATING IN ACCORDANCE WITH THE 752
COOPERATIVE LAWS OF ANOTHER STATE, THE DISTRICT OF COLUMBIA, OR 753
THE UNITED STATES. 754
Sec. 1729.05 1729.06. Five (A) TWO or more persons, a 765
majority of whom are residents of this state and engaged in the 766
production of agricultural products, INDIVIDUALS may form a 767
nonprofit co-operative AN association, with or without capital 768
stock, under sections 1729.01 to 1729.27, inclusive, of the 770
Revised Code UNDER THIS CHAPTER. 771
(B)(1) EVERY ASSOCIATION SHALL HAVE AND MAINTAIN A 774
STATUTORY AGENT UPON WHOM ANY PROCESS, NOTICE, OR DEMAND AGAINST 775
THE ASSOCIATION MAY BE SERVED. THE AGENT MAY BE A NATURAL PERSON 776
WHO IS A RESIDENT OF THIS STATE OR A CORPORATION THAT IS 777
AUTHORIZED BY ITS ARTICLES OF INCORPORATION TO ACT AS SUCH AGENT 778
AND HAS A BUSINESS ADDRESS IN THIS STATE. 779
(2) WHENEVER APPOINTMENT OR DESIGNATION OF A STATUTORY 781
AGENT IS REQUIRED BY THIS CHAPTER, THE APPOINTMENT OR DESIGNATION 783
SHALL BE ON A FORM PRESCRIBED BY THE SECRETARY OF STATE AND SHALL 784
CONFORM WITH SECTION 1702.06 OF THE REVISED CODE. 785
Sec. 1729.07. (A) THE ARTICLES OF INCORPORATION OF AN 787
ASSOCIATION SHALL SET FORTH ALL OF THE FOLLOWING: 788
(1) THE NAME OF THE ASSOCIATION; 790
(2) THE ASSOCIATION'S PURPOSES, AS PERMITTED BY THIS 792
CHAPTER. IT IS SUFFICIENT TO STATE IN THE ARTICLES THAT THE 794
ASSOCIATION MAY ENGAGE IN ANY ACTIVITY WITHIN THE PURPOSES FOR 795
WHICH ASSOCIATIONS MAY BE ORGANIZED UNDER THIS CHAPTER.
(3) THE COUNTY AND MUNICIPAL CORPORATION OR TOWNSHIP WHERE 797
THE ASSOCIATION'S PRINCIPAL PLACE OF BUSINESS WILL BE LOCATED; 798
(4) THE NAMES AND ADDRESSES OF THE INCORPORATORS; 800
(5) THE NUMBER OF ITS DIRECTORS OR A STATEMENT THAT THE 802
NUMBER OF DIRECTORS SHALL BE AS SPECIFIED IN THE BYLAWS; 803
(6) THE NAMES AND ADDRESSES OF THOSE WHO ARE TO SERVE AS 805
DIRECTORS UNTIL THE FIRST ANNUAL MEETING OR UNTIL THE ELECTION 806
AND QUALIFICATION OF THEIR SUCCESSORS; 807
18
(7) WHETHER THE ASSOCIATION IS ORGANIZED WITH OR WITHOUT 809
CAPITAL STOCK.
(a) IF THE ASSOCIATION IS ORGANIZED WITHOUT CAPITAL STOCK, 811
THE ARTICLES SHALL SET FORTH THE GENERAL RULES BY WHICH THE 812
PROPERTY RIGHTS AND INTERESTS OF EACH MEMBER ARE TO BE 813
DETERMINED.
(b) IF THE ASSOCIATION IS ORGANIZED WITH CAPITAL STOCK, 815
THE TOTAL AMOUNT OF THE STOCK, THE NUMBER AND PAR VALUE OF THE 816
SHARES, AND DIVIDEND RIGHTS, IF ANY. IF THERE IS MORE THAN ONE 817
CLASS OF STOCK, THE ARTICLES SHALL SET FORTH A STATEMENT OF THE 818
NUMBER OF SHARES IN EACH CLASS AND A STATEMENT OF THE 819
DESIGNATIONS, PREFERENCES, RIGHTS, AND LIMITATIONS OF THE SHARES
IN EACH CLASS. 820
(B) THE ARTICLES MAY INCLUDE ADDITIONAL PROVISIONS, 822
CONSISTENT WITH LAW, INCLUDING PROVISIONS THAT ARE REQUIRED OR 823
PERMITTED TO BE SET FORTH IN THE BYLAWS. 824
(C) THE ARTICLES SHALL BE SIGNED BY THE INCORPORATORS AND 826
FILED WITH THE SECRETARY OF STATE IN ACCORDANCE WITH SECTION 827
1729.12 OF THE REVISED CODE. THE ARTICLES SHALL BE ACCOMPANIED 828
BY THE APPOINTMENT OF A STATUTORY AGENT IN ACCORDANCE WITH 829
DIVISION (B) OF SECTION 1729.06 OF THE REVISED CODE. THE LEGAL
EXISTENCE OF AN ASSOCIATION BEGINS UPON THE FILING OF THE 831
ARTICLES AND, UNLESS THE ARTICLES PROVIDE OTHERWISE, ITS PERIOD 832
OF EXISTENCE IS PERPETUAL.
Sec. 1729.07 1729.08. (A) The articles of incorporation 842
of an association may be altered or amended at any regular 843
meeting of the association or at any special meeting called for 844
that purpose, PROVIDED THAT THE TEXT OF THE PROPOSED CHANGE, OR A 845
GENERAL DESCRIPTION OF THE CHANGE, IS CONTAINED IN THE NOTICE OF
THE MEETING. An amendment must SHALL first be approved by two 847
thirds of the directors and must SHALL then be adopted by a AN 848
AFFIRMATIVE vote representing a majority of all the members of 851
the association OF SIXTY PER CENT OF THE MEMBER VOTES CAST ON THE 852
AMENDMENT OR, IF THE ARTICLES PROVIDE OR PERMIT, BY THE 853
19
AFFIRMATIVE VOTE OF A GREATER MAJORITY OR BY THE AFFIRMATIVE VOTE 854
OF A SIMPLE MAJORITY OF ALL MEMBER VOTES ELIGIBLE TO BE CAST ON 855
THE AMENDMENT. Amendments 856
(B) AMENDMENTS to the articles of incorporation, when so 859
adopted, shall be filed in accordance with sections 1701.01 to 860
1702.58, inclusive, SECTION 1729.12 of the Revised Code. 861
(C) THE BOARD OF AN ASSOCIATION MAY ADOPT A RESTATEMENT OF 864
THE ARTICLES THAT INCORPORATES AMENDMENTS PREVIOUSLY APPROVED BY 865
THE BOARD AND ADOPTED BY THE MEMBERS. AN ASSOCIATION MAY, BY 866
ACTION TAKEN IN THE MANNER REQUIRED FOR AN AMENDMENT, ADOPT 867
RESTATED ARTICLES THAT CONTAIN AMENDMENTS MADE AT THE TIME OF THE 868
RESTATEMENT. RESTATED ARTICLES SHALL STATE THAT THEY ARE 869
RESTATED, OR RESTATED AND AMENDED, IF AMENDMENTS ARE ADOPTED WITH 870
THE RESTATEMENT, AND SHALL SUPERSEDE THE EXISTING ARTICLES AND
AMENDMENTS. RESTATED ARTICLES SHALL MEET THE REQUIREMENTS OF 871
SECTION 1729.07 OF THE REVISED CODE, EXCEPT THAT THE NAMES AND 872
ADDRESSES OF THE INCORPORATORS AND INITIAL DIRECTORS MAY BE 873
OMITTED. A RESTATEMENT OF THE ARTICLES SHALL BE FILED IN THE
MANNER PRESCRIBED FOR AN AMENDMENT OF THE ARTICLES. 874
(D) EXCEPT AS PROVIDED IN THE ARTICLES OF INCORPORATION, 877
THE BOARD MAY ADOPT AN AMENDMENT TO THE ARTICLES OF INCORPORATION 878
WITHOUT A MEMBER VOTE IN ANY OF THE FOLLOWING CASES: 879
(1) TO CHANGE THE PRINCIPAL PLACE OF BUSINESS OF THE 881
ASSOCIATION; 882
(2) TO DESIGNATE AND DETERMINE THE RIGHTS AND RESTRICTIONS 884
OF A SERIES WITHIN A CLASS OF CAPITAL STOCK, IF PERMITTED BY THE 885
ARTICLES; 886
(3) TO REDUCE THE AUTHORIZED NUMBER OF SHARES OF ANY CLASS 888
OR SERIES OF CAPITAL STOCK TO ANY NUMBER DOWN TO AND INCLUDING 889
THE NUMBER OF THE SHARES ISSUED AND OUTSTANDING, AND TO ASSIGN 890
THE AUTHORIZATION FOR THE NUMBER OF SHARES SO REDUCED TO ANOTHER 891
CLASS OR CLASSES OF CAPITAL STOCK PREVIOUSLY AUTHORIZED; 892
(4) AFTER A MERGER, CONSOLIDATION, CONVERSION, DIVISION, 894
OR OCCURRENCE OF ANY OTHER CONTINGENT EVENT REFERRED TO IN THE 895
20
ARTICLES OF INCORPORATION, TO ELIMINATE FROM THE ARTICLES ANY 896
STATEMENT OR PROVISION PERTAINING EXCLUSIVELY TO THE MERGER, 897
CONSOLIDATION, CONVERSION, DIVISION, OR OCCURRENCE, AND TO MAKE 898
OTHER CHANGES REQUIRED BY SUCH ELIMINATION. 899
Sec. 1729.09. (A)(1) UNLESS THE BOARD PROVIDES THAT 902
DIVISION (A)(3) OF THIS SECTION APPLIES TO AN AMENDMENT TO THE 903
ARTICLES OF INCORPORATION, A HOLDER OF STOCK OTHER THAN
MEMBERSHIP STOCK OR PATRONAGE STOCK WHO IS AFFECTED BY A PROPOSED 905
AMENDMENT TO THE ARTICLES SHALL BE ENTITLED TO CAST ONE VOTE ON 907
THE AMENDMENT REGARDLESS OF THE PAR OR STATED VALUE OF THE STOCK, 908
THE NUMBER OF SHARES, OR THE NUMBER OF AFFECTED CLASSES OF STOCK 910
HELD.
(2) A MEMBER HOLDING STOCK AFFECTED BY A PROPOSED 912
AMENDMENT MAY VOTE ONLY AS A MEMBER AND SHALL NOT BE ENTITLED TO 913
VOTE OR DEMAND FAIR CASH VALUE AS AN AFFECTED STOCKHOLDER. 914
(3) THE BOARD MAY PROVIDE THAT A STOCKHOLDER OTHERWISE 916
ENTITLED TO VOTE UNDER DIVISION (A)(1) OF THIS SECTION SHALL 917
INSTEAD BE ENTITLED TO PAYMENT OF FAIR CASH VALUE OF THE AFFECTED 918
STOCK HELD BY SUCH STOCKHOLDER IN ACCORDANCE WITH SECTION 1729.46 920
OF THE REVISED CODE.
(B) FOR PURPOSES OF THIS SECTION, A HOLDER OF STOCK IS 922
AFFECTED AS TO ANY CLASS OF STOCK OWNED BY THE HOLDER ONLY IF AN 923
AMENDMENT WOULD EXPRESSLY DO ANY OF THE FOLLOWING: 924
(1) DECREASE THE DIVIDENDS TO WHICH THAT CLASS MAY BE 926
ENTITLED OR CHANGE THE METHOD BY WHICH THE DIVIDEND RATE ON THAT 927
CLASS IS FIXED;
(2) FURTHER RESTRICT RIGHTS TO TRANSFER THAT CLASS; 929
(3) GIVE TO ANOTHER EXISTING OR ANY NEW CLASS OF STOCK OR 931
EQUITY INTEREST NOT PREVIOUSLY ENTITLED THERETO ANY PREFERENCE, 932
AS TO DIVIDENDS OR UPON DISSOLUTION, THAT IS HIGHER THAN 933
PREFERENCES OF THAT CLASS;
(4) CHANGE THE PAR VALUE OF SHARES OF THAT CLASS OR OF ANY 935
OTHER CLASS HAVING THE SAME OR HIGHER PREFERENCES AS TO DIVIDENDS 936
OR UPON DISSOLUTION;
21
(5) INCREASE THE NUMBER OF AUTHORIZED SHARES OF ANY CLASS 938
HAVING A HIGHER PREFERENCE AS TO DIVIDENDS OR UPON DISSOLUTION; 939
(6) REQUIRE OR PERMIT AN EXCHANGE OF SHARES OF ANY CLASS 941
WITH LOWER PREFERENCES AS TO DIVIDENDS OR UPON DISSOLUTION FOR 942
SHARES OF ANY OTHER CLASS WITH HIGHER PREFERENCES. 943
(C) IF ANY PROPOSED AMENDMENT WILL ALTER OR CHANGE THE 945
POWERS, PREFERENCES, OR SPECIAL RIGHTS OF ONE OR MORE SERIES OF 946
ANY CLASS SO AS TO AFFECT THEM ADVERSELY, BUT SHALL NOT SO AFFECT 947
THE ENTIRE CLASS, THEN ONLY THE SHARES OF THE SERIES SO AFFECTED 948
BY THE AMENDMENT SHALL BE CONSIDERED A SEPARATE CLASS FOR THE 949
PURPOSES OF DIVISION (B) OF THIS SECTION.
(D) IF STOCKHOLDERS ARE ENTITLED TO VOTE ON AN AMENDMENT, 951
THE AMENDMENT IS ADOPTED ONLY IF ALL OF THE FOLLOWING CONDITIONS 952
ARE MET:
(1) NOTICE OF THE MEETING, AN EXACT COPY OF THE PROPOSED 954
AMENDMENT, AND A BALLOT ON THE AMENDMENT HAVE BEEN SENT TO EACH 955
AFFECTED STOCKHOLDER;
(2) APPROVAL BY THE MEMBERS UNDER SECTION 1729.08 OF THE 957
REVISED CODE;
(3) APPROVAL BY A SIMPLE MAJORITY OF THE AFFECTED 959
STOCKHOLDERS PRESENT AND VOTING AT A MEETING OF THE STOCKHOLDERS. 960
(E) THIS SECTION DOES NOT APPLY TO STOCK ISSUED PRIOR TO 962
THE EFFECTIVE DATE OF THIS SECTION, UNLESS THE ASSOCIATION ADOPTS 963
AN AMENDMENT TO ITS ARTICLES OF INCORPORATION MAKING THE STOCK 965
SUBJECT TO THIS SECTION. AS TO SUCH STOCK, AN AMENDMENT SHALL 966
FIRST BE APPROVED BY TWO-THIRDS OF THE DIRECTORS AND SHALL THEN 967
BE ADOPTED BY A VOTE REPRESENTING A MAJORITY OF ALL THE MEMBERS 968
OF THE ASSOCIATION.
Sec. 1729.10. (A) A COPY OF THE ASSOCIATION'S ARTICLES OF 970
INCORPORATION OR AMENDED ARTICLES FILED IN THE OFFICE OF THE 971
SECRETARY OF STATE, AND CERTIFIED BY THE SECRETARY OF STATE, IS 972
CONCLUSIVE EVIDENCE, EXCEPT AS AGAINST THE STATE, THAT THE 973
ASSOCIATION HAS BEEN INCORPORATED UNDER THE LAWS OF THIS STATE; 974
AND A COPY CERTIFIED BY THE SECRETARY OF STATE OF ANY CERTIFICATE 975
22
OF AMENDMENT OR OTHER CERTIFICATE IS PRIMA-FACIE EVIDENCE OF SUCH
AMENDMENT OR OF THE FACTS STATED IN THE CERTIFICATE, AND OF THE 976
OBSERVANCE AND PERFORMANCE OF ALL ANTECEDENT CONDITIONS NECESSARY 977
TO THE ACTION THAT THE CERTIFICATE PURPORTS TO EVIDENCE. 978
(B) A COPY OF AMENDED ARTICLES FILED IN THE OFFICE OF THE 980
SECRETARY OF STATE, AND CERTIFIED BY THE SECRETARY OF STATE, 981
SHALL BE ACCEPTED IN THIS STATE AND OTHER JURISDICTIONS IN LIEU 982
OF THE ORIGINAL ARTICLES, AMENDMENTS TO THE ARTICLES, AND PRIOR 983
AMENDED ARTICLES.
(C) THE ORIGINAL OR A COPY OF THE RECORD OF MINUTES OF THE 985
PROCEEDINGS OF THE INCORPORATORS OF AN ASSOCIATION, OR OF THE 986
PROCEEDINGS OR MEETINGS OF THE MEMBERS OR ANY CLASS OF 987
STOCKHOLDERS, OR OF THE DIRECTORS, OR OF ANY COMMITTEE THEREOF, 988
INCLUDING ANY WRITTEN CONSENT, WAIVER, RELEASE, OR AGREEMENT 989
ENTERED IN SUCH RECORD OR MINUTES, OR THE ORIGINAL OR A COPY OF A
STATEMENT THAT NO SPECIFIED PROCEEDING WAS HAD OR THAT NO 990
SPECIFIED CONSENT, WAIVER, RELEASE, OR AGREEMENT EXISTS, SHALL, 991
WHEN CERTIFIED TO BE TRUE BY THE SECRETARY OR AN ASSISTANT 992
SECRETARY OF AN ASSOCIATION, BE RECEIVED IN THE COURTS AS 993
PRIMA-FACIE EVIDENCE OF THE FACTS STATED THEREIN. EVERY MEETING
REFERRED TO IN THE CERTIFIED ORIGINAL OR COPY IS CONSIDERED DULY 994
CALLED AND HELD, AND ALL MOTIONS AND RESOLUTIONS ADOPTED AND 996
PROCEEDINGS HAD AT THE MEETING ARE CONSIDERED DULY ADOPTED AND 997
HAD, AND ALL ELECTIONS OF DIRECTORS AND ALL ELECTIONS OR 999
APPOINTMENTS OF OFFICERS CHOSEN AT THE MEETING ARE CONSIDERED
VALID, UNTIL THE CONTRARY IS PROVED; AND WHENEVER A PERSON WHO IS 1,001
NOT A MEMBER, PATRON, OR STOCKHOLDER OF AN ASSOCIATION HAS ACTED 1,002
IN GOOD FAITH IN RELIANCE UPON ANY SUCH CERTIFIED ORIGINAL OR 1,003
COPY, IT IS CONCLUSIVE IN THAT PERSON'S FAVOR.
Sec. 1729.11. (A) AN ASSOCIATION WHOSE ARTICLES OF 1,005
INCORPORATION HAVE BEEN CANCELED OR AN ASSOCIATION THAT HAS BEEN 1,006
DISSOLVED IN A MANNER OTHER THAN FOR A VOLUNTARY DISSOLUTION AS 1,007
PROVIDED IN SECTION 1729.55 OF THE REVISED CODE, OR A JUDICIAL 1,008
DISSOLUTION AS PROVIDED IN SECTION 1729.61 OF THE REVISED CODE,
23
MAY BE REINSTATED BY FILING, ON A FORM PRESCRIBED BY THE 1,009
SECRETARY OF STATE, AN APPLICATION FOR REINSTATEMENT AND THE 1,010
REQUIRED APPOINTMENT OF A STATUTORY AGENT, AND BY PAYING A FILING 1,011
FEE OF TEN DOLLARS.
(B) UPON REINSTATEMENT OF AN ASSOCIATION'S ARTICLES OF 1,013
INCORPORATION, THE RIGHTS, PRIVILEGES, AND FRANCHISES, INCLUDING 1,014
ALL REAL OR PERSONAL PROPERTY RIGHTS AND CREDITS AND ALL CONTRACT 1,015
AND OTHER RIGHTS, OF THE ASSOCIATION EXISTING AT THE TIME THAT 1,016
ITS ARTICLES WERE CANCELED OR THE DISSOLUTION BECAME EFFECTIVE 1,017
SHALL BE CONTINUED IN EFFECT AS IF THE ARTICLES HAD NOT BEEN 1,018
CANCELED OR THE DISSOLUTION HAD NOT OCCURRED; AND THE ASSOCIATION
SHALL AGAIN BE ENTITLED TO EXERCISE THE RIGHTS, PRIVILEGES, AND 1,019
FRANCHISES AUTHORIZED BY ITS ARTICLES. 1,020
Sec. 1729.12. (A) FOR FILING ARTICLES OF INCORPORATION OR 1,022
A CERTIFICATE OF AMENDMENT OF ARTICLES OR A CERTIFICATE OF 1,024
MERGER, CONSOLIDATION, DIVISION, OR DISSOLUTION, AND WITH RESPECT 1,025
TO THE ISSUANCE OF SHARES OF STOCK, AN ASSOCIATION ORGANIZED 1,026
UNDER THIS CHAPTER SHALL PAY TO THE SECRETARY OF STATE THE FEES 1,027
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 1,028
A CERTIFICATE OF MERGER OR CONSOLIDATION. 1,029
(B) WHEN THE ARTICLES OF INCORPORATION, OR A CERTIFICATE 1,032
OF AMENDMENT OF ARTICLES, OR A CERTIFICATE OF MERGER,
CONSOLIDATION, CONVERSION, DIVISION, OR DISSOLUTION IS FILED WITH 1,033
THE SECRETARY OF STATE, THE SECRETARY OF STATE SHALL, IF THE 1,035
ARTICLES OR CERTIFICATE COMPLIES WITH THIS CHAPTER, ENDORSE 1,036
APPROVAL THEREON, THE DATE OF FILING, A FILE NUMBER, AND MAKE A 1,037
LEGIBLE COPY THEREOF BY ANY AUTHORIZED METHOD. THE ORIGINAL OR A 1,038
COPY OF THE ARTICLES OR CERTIFICATE, CERTIFIED BY THE SECRETARY 1,039
OF STATE, SHALL BE RETURNED TO THE PERSON FILING THE ARTICLES OR 1,040
CERTIFICATE.
(C) ALL PERSONS SHALL HAVE THE OPPORTUNITY TO ACQUIRE A 1,042
COPY OF THE ARTICLES AND OTHER CERTIFICATES FILED AND RECORDED IN 1,043
THE OFFICE OF THE SECRETARY OF STATE, BUT NO PERSON DEALING WITH 1,044
24
THE ASSOCIATION SHALL BE CHARGED WITH CONSTRUCTIVE NOTICE OF THE 1,045
CONTENTS OF ANY SUCH ARTICLES OR CERTIFICATES BY REASON OF THE 1,046
FILING OR RECORDING.
Sec. 1729.13. (A) AN ASSOCIATION MAY PAY DIVIDENDS 1,048
ANNUALLY ON ITS CAPITAL STOCK. ALL ITS OTHER NET INCOME FROM 1,049
BUSINESS WITH OR FOR MEMBERS AND OTHER ELIGIBLE PATRONS, LESS 1,050
RESERVES WHICH SHALL BE PROVIDED FOR IN THE BYLAWS OR OTHER 1,051
WRITTEN AGREEMENTS, SHALL BE DISTRIBUTED TO ITS MEMBERS AND OTHER 1,052
ELIGIBLE PATRONS ON THE BASIS OF PATRONAGE AS PROVIDED IN THE
BYLAWS OR OTHER WRITTEN AGREEMENTS. ANY RECEIPTS OR DIVIDENDS 1,053
FROM SUBSIDIARY CORPORATIONS, OR FROM STOCK OR OTHER SECURITIES 1,054
OWNED BY THE ASSOCIATION, MAY BE INCLUDED IN THE ORDINARY 1,055
RECEIPTS OF THE ASSOCIATION, AND MAY BE DISTRIBUTED ACCORDINGLY. 1,056
(B) AN ASSOCIATION, AT ANY TIME, MAY PURCHASE ITS OWN 1,058
COMMON STOCK AT PAR OR BOOK VALUE AS DETERMINED BY THE BOARD. 1,059
(C) AN ASSOCIATION SHALL HAVE A CONTINUED PERFECTED 1,062
SECURITY INTEREST IN ITS MEMBERSHIP STOCK AND PATRONAGE STOCK TO 1,063
SECURE PAYMENT OF ANY INDEBTEDNESS OR OTHER OBLIGATION OF THE 1,064
HOLDER OR OWNER TO THE ASSOCIATION. NOTWITHSTANDING CHAPTERS 1,066
1308. AND 1309. OF THE REVISED CODE, THE SECURITY INTEREST SHALL 1,069
HAVE PRIORITY OVER ALL OTHER PERFECTED SECURITY INTERESTS.
UNLESS OTHERWISE PROVIDED IN THE ASSOCIATION'S ARTICLES OF 1,070
INCORPORATION OR BYLAWS, OR BY CONTRACT, A MEMBER OR OTHER PATRON 1,072
HAS NO RIGHT TO COMPEL AN ASSOCIATION TO OFFSET ITS MEMBERSHIP 1,073
STOCK OR PATRONAGE STOCK AGAINST ANY INDEBTEDNESS OR OBLIGATION 1,074
OWED TO THE ASSOCIATION.
Sec. 1729.14. EACH ASSOCIATION SHALL ADOPT FOR ITS 1,076
GOVERNANCE AND MANAGEMENT, BYLAWS THAT ARE CONSISTENT WITH THE 1,077
POWERS GRANTED BY THIS CHAPTER AND THE ARTICLES OF INCORPORATION 1,078
OF THE ASSOCIATION. THE BYLAWS MAY PROVIDE FOR ANY OF THE 1,079
FOLLOWING: 1,080
(A) THE TIME, PLACE, AND MANNER OF CALLING AND CONDUCTING 1,082
THE ASSOCIATION'S MEETINGS; 1,083
(B) THE NUMBER OF MEMBERS CONSTITUTING A QUORUM. IF 1,085
25
VOTING BY ANY METHOD OTHER THAN PERSONAL APPEARANCE IS USED, 1,086
MEMBERS REPRESENTED BY A BALLOT OR BY PROXY MAY BE COUNTED IN 1,087
COMPUTING A QUORUM ONLY ON THOSE MATTERS FOR WHICH THE BALLOTS OR 1,088
PROXIES WERE SUBMITTED.
(C) THE RIGHT OF MEMBERS TO VOTE BY PROXY OR BY BALLOT 1,090
DELIVERED IN PERSON, BY MAIL, BY ELECTRONIC OR TELEPHONIC 1,091
TRANSMITTAL, OR ANY COMBINATION OF THESE, AND THE CONDITIONS, 1,092
MANNER, FORM, AND EFFECT OF SUCH VOTES; 1,093
(D) SUBJECT TO THE PROVISIONS OF SECTION 1729.17 OF THE 1,095
REVISED CODE, A METHOD OF VOTING BY MEMBERS OR DELEGATES, AND ANY 1,096
LIMITATIONS ON VOTING RIGHTS OF ANY GROUP OR CLASS OF MEMBERS OR 1,097
DELEGATES;
(E) THE NUMBER OF DIRECTORS CONSTITUTING A QUORUM; 1,099
(F) THE NUMBER, QUALIFICATIONS, COMPENSATION, DUTIES, AND 1,101
TERMS OF OFFICE OF DIRECTORS AND OFFICERS, AND THE TIME OF THEIR 1,102
ELECTION AND THE MANNER OF GIVING NOTICE OF THE ELECTION; 1,103
(G) PENALTIES FOR VIOLATION OF THE BYLAWS; 1,105
(H) THE AMOUNTS OF ENTRANCE, ORGANIZATION, AND MEMBERSHIP 1,107
FEES, IF ANY; THE MANNER OF COLLECTING THEM; AND THE PURPOSES FOR 1,108
WHICH THEY MAY BE USED; 1,109
(I) ANY AMOUNT THAT EACH MEMBER IS REQUIRED TO PAY 1,111
ANNUALLY OR FROM TIME TO TIME TO CARRY ON THE BUSINESS OF THE 1,112
ASSOCIATION; ANY CHARGE TO BE PAID BY EACH MEMBER FOR SERVICES 1,113
RENDERED BY THE ASSOCIATION, AND THE TIME OF PAYMENT AND THE 1,114
MANNER OF COLLECTION OF SUCH CHARGE; AND ANY MARKETING CONTRACT 1,115
BETWEEN THE ASSOCIATION AND ITS MEMBERS THAT EVERY MEMBER MAY BE
REQUIRED TO SIGN; 1,116
(J) THE NUMBER AND QUALIFICATIONS OF MEMBERS OF THE 1,118
ASSOCIATION AND THE CONDITIONS OF MEMBERSHIP OR FOR OWNERSHIP OF 1,119
MEMBERSHIP STOCK IN THE ASSOCIATION; 1,120
(K) THE TIME AND MANNER OF PERMITTING MEMBERS TO WITHDRAW 1,122
OR THE HOLDERS OF MEMBERSHIP STOCK TO TRANSFER THEIR STOCK; AND 1,123
THE MANNER OF ASSIGNMENT AND TRANSFER OF MEMBERSHIP STOCK; 1,125
(L) THE CONDITIONS UPON WHICH, AND THE TIME WHEN, THE 1,127
26
MEMBERSHIP OF ANY MEMBER CEASES; AND THE SUSPENSION OF THE RIGHTS 1,128
OF A MEMBER WHO CEASES TO BE ELIGIBLE FOR MEMBERSHIP IN THE 1,129
ASSOCIATION;
(M) THE MANNER AND EFFECT OF THE EXPULSION OF A MEMBER; 1,131
(N) IN THE EVENT OF THE DEATH OR WITHDRAWAL OF A MEMBER OR 1,133
UPON THE EXPULSION OF A MEMBER OR THE FORFEITURE OF MEMBERSHIP, 1,135
ANY OF THE FOLLOWING:
(1) THE MANNER OF DETERMINING THE VALUE OF A MEMBER'S 1,137
INTEREST;
(2) PROVISION FOR THE PURCHASE OF A MEMBER'S INTEREST BY 1,139
THE ASSOCIATION;
(3) AT THE OPTION OF THE ASSOCIATION, PROVISION FOR SUCH 1,141
PURCHASE AT A PRICE FIXED BY APPRAISAL BY THE BOARD OF DIRECTORS 1,142
OF THE ASSOCIATION.
(O) ANY OTHER PROVISION FOR ANY MATTER RELATIVE TO THE 1,144
CONTROL, REGULATION, OPERATION, MANAGEMENT, OR GOVERNMENT OF THE 1,145
ASSOCIATION.
Sec. 1729.16. (A) THE INITIAL BYLAWS MAY BE ADOPTED BY 1,147
THE ASSOCIATION'S DIRECTORS WHO ARE TO SERVE UNTIL THE FIRST 1,148
ANNUAL MEETING. AFTER THE INITIAL BYLAWS ARE ADOPTED, BYLAWS MAY 1,150
BE ADOPTED AND AMENDED ONLY BY THE MEMBERS UNLESS THE MEMBERS 1,151
ADOPT A BYLAW THAT PERMITS THE BOARD TO MAKE AND AMEND SPECIFIED 1,152
BYLAWS.
(B) ANY BYLAW ADOPTED OR AMENDED BY THE BOARD SHALL BE 1,154
REPORTED AT THE NEXT REGULAR MEMBER MEETING. ANY SUCH BYLAW IS 1,155
SUBJECT TO AMENDMENT OR REPEAL BY THE MEMBERS AT ANY TIME. 1,156
(C) UNLESS THE BYLAWS PROVIDE OTHERWISE, ANY BYLAW MAY BE 1,158
ADOPTED, AMENDED, OR REPEALED BY A MAJORITY OF THE MEMBER VOTES 1,159
CAST ON THE ADOPTION, AMENDMENT, OR REPEAL. 1,160
Sec. 1729.17. (A) EACH MEMBER ENTITLED TO VOTE SHALL HAVE 1,162
ONE VOTE, EXCEPT THAT THE ARTICLES OR BYLAWS OF THE ASSOCIATION 1,163
MAY PERMIT THE FOLLOWING: 1,164
(1) VOTING BY MEMBERS IN ACCORDANCE WITH THE AMOUNT OF 1,166
BUSINESS DONE WITH OR THROUGH THE ASSOCIATION. 1,167
27
(2) VOTING BY DELEGATES, INCLUDING A VOTING SYSTEM THAT 1,169
PROVIDES ANY ONE OR A COMBINATION OF THE FOLLOWING: 1,170
(a) THAT A DELEGATE MAY CAST ONLY ONE VOTE; 1,172
(b) THAT A DELEGATE MAY CAST ONE VOTE FOR EACH MEMBER 1,174
REPRESENTED BY THE DELEGATE; 1,175
(c) THAT ANOTHER FORM OF DELEGATE VOTING MAY BE USED. 1,177
(3) VOTING BY DELEGATES OR CERTAIN MEMBERS ON MATTERS THAT 1,179
ARE TO BE SUBMITTED TO A MEMBER VOTE. 1,180
(4) VOTING BY ANY COMBINATION OF THE METHODS SET FORTH IN 1,182
DIVISION (A)(1), (2), OR (3) OF THIS SECTION OR ANY OTHER METHOD 1,184
OF VOTING SET FORTH IN THE BYLAWS, PROVIDED THE ASSOCIATION IS
CONTROLLED BY THE MEMBERS. 1,185
(B) IF THE ARTICLES OR BYLAWS PROVIDE THAT ONLY DELEGATES 1,187
OR CERTAIN MEMBERS ARE ENTITLED TO VOTE ON MATTERS TO BE 1,188
SUBMITTED TO A MEMBER VOTE, "MEMBER" OR "MEMBERS," AS USED IN 1,189
THIS CHAPTER WITH RESPECT TO THE RIGHT OF A MEMBER TO VOTE, 1,190
VOTING PROCEDURE, THE REQUIRED PROPORTION OF MEMBER VOTES, 1,191
ACTIONS THAT ARE REQUIRED OR PERMITTED TO BE TAKEN BY MEMBERS,
AND THE NUMBER OF MEMBERS REQUIRED FOR A QUORUM, MEANS THE 1,192
DELEGATES OR OTHER MEMBERS ENTITLED TO VOTE. WHERE VOTING IS 1,193
BASED ON THE AMOUNT OF BUSINESS DONE, PROVISIONS OF THIS CHAPTER 1,194
REQUIRING A VOTE OF THE MEMBERS ARE MET IF THE REQUIRED 1,195
MEMBERSHIP VOTE IS SATISFIED BASED ON THE VOTING POWER OF THE 1,196
MEMBERS.
Sec. 1729.18. (A) AN ASSOCIATION SHALL HAVE TWO OR MORE 1,198
MEMBERS. HOWEVER, AN ASSOCIATION MAY HAVE ONE MEMBER IF THAT 1,199
MEMBER IS AN ASSOCIATION THAT HAS TWO OR MORE MEMBERS. 1,200
(B) EACH ASSOCIATION SHALL HOLD AN ANNUAL MEETING OF ITS 1,202
MEMBERS. THE BOARD MAY CALL A SPECIAL MEETING OF THE MEMBERS AT 1,204
ANY TIME. ANY MEETING OF THE MEMBERS MAY BE HELD AT ONE TIME OR
IN A SERIES OF MEETINGS AT ONE OR MORE LOCATIONS. 1,205
(C) TWENTY PER CENT OF THE MEMBERS ENTITLED TO VOTE MAY 1,207
FILE WITH THE BOARD A PETITION STATING THE SPECIFIC BUSINESS TO 1,208
BE BROUGHT BEFORE THE ASSOCIATION AND DEMANDING A SPECIAL MEETING 1,209
28
AT ANY TIME FOR CONSIDERATION OF SUCH BUSINESS. UPON COMPLIANCE 1,210
WITH THIS DIVISION, THE MEETING SHALL BE CALLED BY THE BOARD. 1,211
(D) NOTICE OF EVERY MEETING, TOGETHER WITH A STATEMENT OF 1,213
THE PURPOSE OF THE MEETING, SHALL BE SENT TO EACH MEMBER WHO IS 1,214
ENTITLED TO VOTE AT THE MEETING AND ANY AFFECTED STOCKHOLDER AT 1,216
THE MEMBER'S OR STOCKHOLDER'S CURRENT ADDRESS, AS SHOWN IN THE 1,217
RECORDS OF THE ASSOCIATION, AT LEAST TEN DAYS PRIOR TO THE 1,218
MEETING, IN ACCORDANCE WITH SECTION 1729.20 OF THE REVISED CODE. 1,219
THE BYLAWS MAY PROVIDE THAT THE NOTICE BE GIVEN BY PUBLICATION IN 1,220
A NEWSPAPER OR NEWSPAPERS OF GENERAL CIRCULATION IN THE TRADE 1,222
AREA OF THE ASSOCIATION IF NOTICE TO INDIVIDUAL MEMBERS AND
AFFECTED SHAREHOLDERS IS IMPRACTICABLE. 1,223
Sec. 1729.19. (A) UNLESS PROHIBITED IN AN ASSOCIATION'S 1,225
ARTICLES OF INCORPORATION OR BYLAWS, ANY ACTION THAT MAY BE 1,226
AUTHORIZED OR TAKEN AT A MEETING OF THE MEMBERS, AFFECTED 1,227
STOCKHOLDERS, THE BOARD, OR ANY COMMITTEE OF THE BOARD, MAY BE 1,228
AUTHORIZED OR TAKEN WITHOUT A MEETING, WITH THE AFFIRMATIVE VOTE 1,229
OR APPROVAL OF, AND IN WRITING OR WRITINGS SIGNED BY: 1,230
(1) IN THE CASE OF MEMBERS OR AFFECTED STOCKHOLDERS, SIXTY 1,232
PER CENT OF THE VOTES OF THE MEMBERS OR STOCKHOLDERS WHO WOULD BE 1,233
ENTITLED TO VOTE ON THE ACTION AT A MEETING FOR SUCH PURPOSE; 1,234
(2) IN THE CASE OF THE BOARD OF DIRECTORS OR A COMMITTEE 1,236
OF THE BOARD, ALL OF THE DIRECTORS ON THE BOARD OR ALL OF THE 1,237
COMMITTEE MEMBERS ON THE COMMITTEE. 1,238
(B) ANY SUCH WRITING OR WRITINGS SHALL BE INCLUDED IN THE 1,240
RECORDS OF THE ASSOCIATION IN THE SAME MANNER AS MINUTES OF 1,241
MEETINGS OF THE ASSOCIATION'S MEMBERS, AFFECTED STOCKHOLDERS, 1,242
BOARD, OR COMMITTEE OF THE BOARD. 1,243
(C) ANY CERTIFICATE WITH RESPECT TO THE AUTHORIZATION OR 1,245
TAKING OF ANY ACTION THAT IS REQUIRED TO BE FILED IN THE OFFICE 1,246
OF THE SECRETARY OF STATE SHALL STATE THAT THE AUTHORIZATION OR 1,247
TAKING OF SUCH ACTION WAS IN WRITING OR WRITINGS APPROVED AND 1,248
SIGNED AS PROVIDED IN THIS SECTION.
Sec. 1729.20. (A) WHENEVER NOTICE IS REQUIRED BY THIS 1,250
29
CHAPTER TO BE GIVEN TO ANY PERSON, THE NOTICE MAY BE GIVEN 1,251
PERSONALLY, BY MAIL, OR BY ELECTRONIC OR TELEPHONIC TRANSMITTAL. 1,252
IF MAILED, THE NOTICE IS GIVEN WHEN IT IS DEPOSITED IN THE UNITED 1,253
STATES MAIL, WITH POSTAGE PREPAID, ADDRESSED TO THE PERSON AT THE 1,255
PERSON'S ADDRESS AS IT APPEARS ON THE RECORDS OF THE ASSOCIATION. 1,256
IF NOTICE IS SENT BY ELECTRONIC OR TELEPHONIC TRANSMITTAL, NOTICE 1,257
IS GIVEN WHEN AN ELECTRONIC OR TELEPHONIC CONFIRMATION OF 1,258
DELIVERY IS RECEIVED BY THE ASSOCIATION.
(B) A SIGNED WAIVER IS EQUIVALENT TO PERSONAL NOTICE TO 1,260
THE PERSON SIGNING. THE WAIVER MAY BE SIGNED AT ANY TIME. 1,261
Sec. 1729.22. (A) EXCEPT WHERE THIS CHAPTER OR AN 1,263
ASSOCIATION'S ARTICLES OF INCORPORATION OR BYLAWS REQUIRE THAT 1,264
ACTION BE OTHERWISE AUTHORIZED OR TAKEN, ALL OF THE AUTHORITY OF 1,265
AN ASSOCIATION SHALL BE EXERCISED BY OR UNDER THE DIRECTION OF 1,266
THE BOARD. THE BOARD SHALL CONSIST OF NOT LESS THAN FIVE 1,267
DIRECTORS, ELECTED BY AND FROM THE MEMBERS, UNLESS THE NUMBER OF 1,268
MEMBERS IS LESS THAN FIVE, IN WHICH CASE, THE NUMBER OF DIRECTORS
MAY EQUAL THE NUMBER OF MEMBERS. 1,269
(B) THE BYLAWS MAY PROVIDE THAT THE MEMBERSHIP OF AN 1,271
ASSOCIATION BE DIVIDED INTO DISTRICTS OR OTHER GROUPINGS AND THAT 1,272
THE DIRECTORS SHALL BE ELECTED ACCORDING TO SUCH DISTRICTS OR 1,273
GROUPINGS. IN SUCH CASE, THE BYLAWS SHALL SPECIFY THE NUMBER OF 1,274
DIRECTORS TO BE ELECTED AND THE MANNER OF REAPPORTIONING OR 1,275
REDISTRICTING THE MEMBERSHIP.
(C) THE BYLAWS MAY PROVIDE THAT ONE OR MORE DIRECTORS MAY 1,277
BE APPOINTED BY THE OTHER DIRECTORS. THE APPOINTED DIRECTORS 1,278
NEED NOT BE MEMBERS OF THE ASSOCIATION, BUT SHALL HAVE THE SAME 1,279
POWERS, RIGHTS, AND RESPONSIBILITIES AS OTHER DIRECTORS. THE 1,280
APPOINTED DIRECTORS SHALL NOT NUMBER MORE THAN ONE-FIFTH OF THE 1,281
ENTIRE NUMBER OF DIRECTORS.
(D) THE BYLAWS MAY PROVIDE FOR AN EXECUTIVE COMMITTEE AND 1,283
MAY ALLOT TO THE COMMITTEE ANY OF THE FUNCTIONS AND POWERS OF THE 1,284
BOARD, SUBJECT TO THE GENERAL DIRECTION AND CONTROL OF THE BOARD. 1,286
(E) THE ASSOCIATION MAY PROVIDE A FAIR REMUNERATION FOR 1,288
30
THE TIME ACTUALLY SPENT BY ITS OFFICERS AND DIRECTORS IN ITS 1,289
SERVICE, AND FOR THE SERVICES OF THE MEMBERS OF ITS EXECUTIVE 1,290
COMMITTEE.
(F) WHEN A VACANCY ON THE BOARD OCCURS OTHER THAN BY 1,292
EXPIRATION OF TERM, THE REMAINING DIRECTORS ON THE BOARD, BY A 1,293
MAJORITY VOTE, SHALL ELECT A DIRECTOR TO FILL THE VACANCY. IF 1,295
THE BYLAWS PROVIDE FOR AN ELECTION OF DIRECTORS BY DISTRICT OR 1,296
OTHER GROUPING, THE BOARD MAY CALL A SPECIAL MEETING OF THE 1,297
MEMBERS IN THAT DISTRICT OR GROUP TO FILL THE VACANCY.
Sec. 1729.23. (A) A DIRECTOR SHALL PERFORM THE DUTIES OF 1,300
A DIRECTOR, INCLUDING DUTIES AS A MEMBER OF ANY COMMITTEE OF THE
DIRECTORS UPON WHICH THE DIRECTOR SERVES, IN GOOD FAITH, IN A 1,301
MANNER THE DIRECTOR REASONABLY BELIEVES TO BE IN OR NOT OPPOSED 1,303
TO THE BEST INTERESTS OF THE ASSOCIATION, AND WITH THE CARE THAT 1,304
AN ORDINARILY PRUDENT PERSON IN A LIKE POSITION WOULD USE UNDER 1,305
SIMILAR CIRCUMSTANCES. IN PERFORMING THESE DUTIES, A DIRECTOR IS
ENTITLED TO RELY ON INFORMATION, OPINIONS, REPORTS, OR 1,306
STATEMENTS, INCLUDING FINANCIAL STATEMENTS AND OTHER FINANCIAL 1,307
DATA, THAT ARE PREPARED OR PRESENTED BY ANY OF THE FOLLOWING: 1,308
(1) ONE OR MORE DIRECTORS, OFFICERS, OR EMPLOYEES OF THE 1,310
ASSOCIATION WHOM THE DIRECTOR REASONABLY BELIEVES ARE RELIABLE 1,311
AND COMPETENT IN THE MATTERS PREPARED OR PRESENTED; 1,312
(2) COUNSEL, PUBLIC ACCOUNTANTS, OR OTHER PERSONS AS TO 1,314
MATTERS THAT THE DIRECTOR REASONABLY BELIEVES ARE WITHIN THE 1,315
PERSON'S PROFESSIONAL OR EXPERT COMPETENCE; 1,316
(3) A COMMITTEE OF THE DIRECTORS UPON WHICH THE DIRECTOR 1,318
DOES NOT SERVE, ESTABLISHED IN ACCORDANCE WITH THE ASSOCIATION'S 1,319
ARTICLES OF INCORPORATION OR BYLAWS, AS TO MATTERS WITHIN ITS 1,320
DESIGNATED AUTHORITY, PROVIDED THE DIRECTOR REASONABLY BELIEVES 1,321
THE COMMITTEE MERITS CONFIDENCE.
(B) FOR PURPOSES OF DIVISION (A) OF THIS SECTION: 1,323
(1) A DIRECTOR SHALL NOT BE FOUND TO HAVE FAILED TO 1,325
PERFORM THE DUTIES IN ACCORDANCE WITH DIVISION (A) OF THIS 1,326
SECTION, UNLESS IT IS PROVED, BY CLEAR AND CONVINCING EVIDENCE, 1,327
31
IN AN ACTION BROUGHT AGAINST THE DIRECTOR THAT THE DIRECTOR HAS 1,328
NOT ACTED IN GOOD FAITH, IN A MANNER REASONABLY BELIEVED TO BE IN 1,329
OR NOT OPPOSED TO THE BEST INTERESTS OF THE ASSOCIATION, OR WITH
THE CARE THAT AN ORDINARILY PRUDENT PERSON IN A LIKE POSITION 1,330
WOULD USE UNDER SIMILAR CIRCUMSTANCES. SUCH AN ACTION INCLUDES, 1,331
BUT IS NOT LIMITED TO, AN ACTION THAT INVOLVES OR AFFECTS ANY OF 1,332
THE FOLLOWING:
(a) A CHANGE OR POTENTIAL CHANGE IN CONTROL OF THE 1,334
ASSOCIATION;
(b) A TERMINATION OR POTENTIAL TERMINATION OF THE 1,336
DIRECTOR'S SERVICE TO THE ASSOCIATION AS A DIRECTOR; 1,337
(c) SERVICE IN ANY OTHER POSITION OR RELATIONSHIP WITH THE 1,339
ASSOCIATION. 1,340
(2) A DIRECTOR SHALL NOT BE CONSIDERED TO BE ACTING IN 1,342
GOOD FAITH IF THE DIRECTOR HAS KNOWLEDGE CONCERNING THE MATTER IN 1,343
QUESTION THAT WOULD CAUSE RELIANCE ON INFORMATION, OPINIONS, 1,344
REPORTS, OR STATEMENTS THAT ARE PREPARED OR PRESENTED BY THE 1,345
PERSONS DESCRIBED IN DIVISIONS (A)(1) TO (3) OF THIS SECTION TO 1,346
BE UNWARRANTED.
(3) THE PROVISIONS OF DIVISION (B) OF THIS SECTION DO NOT 1,348
LIMIT RELIEF AVAILABLE UNDER SECTION 1729.24 OF THE REVISED CODE. 1,349
(C)(1) SUBJECT TO DIVISIONS (C)(2) AND (3) OF THIS 1,351
SECTION, A DIRECTOR IS LIABLE IN DAMAGES FOR ANY ACT THAT THE 1,352
DIRECTOR TAKES OR FAILS TO TAKE AS DIRECTOR ONLY IF IT IS PROVED, 1,353
BY CLEAR AND CONVINCING EVIDENCE, IN AN ACTION BROUGHT AGAINST 1,354
THE DIRECTOR THAT THE ACT OR OMISSION OF THE DIRECTOR WAS ONE 1,355
UNDERTAKEN WITH A DELIBERATE INTENT TO CAUSE INJURY TO THE 1,356
ASSOCIATION OR WAS ONE UNDERTAKEN WITH A RECKLESS DISREGARD FOR 1,357
THE BEST INTERESTS OF THE ASSOCIATION. 1,358
(2) DIVISION (C)(1) OF THIS SECTION DOES NOT AFFECT THE 1,360
LIABILITY OF A DIRECTOR UNDER SECTION 1729.25 OF THE REVISED 1,361
CODE.
(3) SUBJECT TO DIVISION (C)(2) OF THIS SECTION, DIVISION 1,364
(C)(1) OF THIS SECTION DOES NOT APPLY IF, AND ONLY TO THE EXTENT
32
THAT, AT THE TIME OF AN ACT OR OMISSION OF THE DIRECTOR, THE 1,365
ASSOCIATION'S ARTICLES OF INCORPORATION OR BYLAWS STATE, BY 1,366
SPECIFIC REFERENCE TO DIVISION (C)(1) OF THIS SECTION, THAT ITS 1,367
PROVISIONS DO NOT APPLY TO THE ASSOCIATION. 1,368
(D) FOR PURPOSES OF THIS SECTION, IN DETERMINING WHAT IS 1,370
REASONABLY BELIEVED TO BE IN OR NOT OPPOSED TO THE BEST INTERESTS 1,371
OF THE ASSOCIATION, A DIRECTOR SHALL CONSIDER THE PURPOSES OF THE 1,372
ASSOCIATION AND MAY CONSIDER ANY OF THE FOLLOWING: 1,373
(1) THE INTERESTS OF THE EMPLOYEES, SUPPLIERS, CREDITORS, 1,375
AND CUSTOMERS OF THE ASSOCIATION; 1,376
(2) THE ECONOMY OF THIS STATE AND OF THE UNITED STATES; 1,378
(3) COMMUNITY AND SOCIETAL MATTERS; 1,380
(4) THE LONG-TERM AND SHORT-TERM BEST INTERESTS OF THE 1,382
ASSOCIATION, INCLUDING, BUT NOT LIMITED TO, THE POSSIBILITY THAT 1,383
THOSE INTERESTS MAY BE BEST SERVED BY THE CONTINUED INDEPENDENCE 1,384
OF THE ASSOCIATION.
(E) DIVISIONS (B) AND (C) OF THIS SECTION DO NOT AFFECT 1,387
THE DUTIES OF A DIRECTOR WHO ACTS IN ANY CAPACITY OTHER THAN AS A
DIRECTOR. 1,388
Sec. 1729.24. (A) UNLESS OTHERWISE PROVIDED IN AN 1,390
ASSOCIATION'S ARTICLES OF INCORPORATION OR BYLAWS: 1,391
(1) NO CONTRACT OR TRANSACTION BETWEEN AN ASSOCIATION AND 1,393
ONE OR MORE OF ITS DIRECTORS OR OFFICERS, OR BETWEEN THE 1,394
ASSOCIATION AND ANY OTHER PERSON IN WHICH ONE OR MORE OF THE 1,395
ASSOCIATION'S DIRECTORS OR OFFICERS, ARE DIRECTORS OR OFFICERS, 1,396
OR HAVE A FINANCIAL OR PERSONAL INTEREST, SHALL BE VOID OR
VOIDABLE SOLELY FOR THIS REASON, OR SOLELY BECAUSE THE DIRECTOR 1,397
OR OFFICER IS PRESENT AT OR PARTICIPATES IN THE MEETING OF THE 1,398
BOARD OR COMMITTEE THAT AUTHORIZES THE CONTRACT OR TRANSACTION, 1,399
OR SOLELY BECAUSE THE DIRECTOR'S OR OFFICER'S VOTES ARE COUNTED 1,400
FOR SUCH PURPOSE, IF ANY OF THE FOLLOWING APPLIES:
(a) THE MATERIAL FACTS AS TO THE RELATIONSHIP OR INTEREST 1,402
AND AS TO THE CONTRACT OR TRANSACTION ARE DISCLOSED OR ARE KNOWN 1,403
TO THE BOARD OR THE COMMITTEE, AND THE BOARD OR COMMITTEE, IN 1,404
33
GOOD FAITH AUTHORIZES THE CONTRACT OR TRANSACTION BY THE 1,405
AFFIRMATIVE VOTE OF A MAJORITY OF THE DISINTERESTED DIRECTORS, 1,406
EVEN THOUGH THE DISINTERESTED DIRECTORS CONSTITUTE LESS THAN A
QUORUM OF THE BOARD OR THE COMMITTEE; 1,407
(b) THE MATERIAL FACTS AS TO THE RELATIONSHIP OR INTEREST 1,409
AND AS TO THE CONTRACT OR TRANSACTION ARE DISCLOSED OR ARE KNOWN 1,410
TO THE MEMBERS ENTITLED TO VOTE ON THE CONTRACT OR TRANSACTION, 1,411
AND THE CONTRACT OR TRANSACTION IS SPECIFICALLY APPROVED AT A 1,412
MEETING OF THE MEMBERS;
(c) THE CONTRACT OR TRANSACTION IS FAIR AS TO THE 1,414
ASSOCIATION AT THE TIME IT IS AUTHORIZED OR APPROVED BY THE 1,415
BOARD, OR A COMMITTEE OF THE BOARD, OR THE MEMBERS. 1,416
(2) COMMON OR INTERESTED DIRECTORS MAY BE COUNTED IN 1,418
DETERMINING THE PRESENCE OF A QUORUM AT A MEETING OF THE BOARD, 1,419
OR OF A COMMITTEE THAT AUTHORIZES THE CONTRACT OR TRANSACTION. 1,420
(B) DIVISIONS (A)(1) AND (2) OF THIS SECTION DO NOT LIMIT 1,423
OR OTHERWISE AFFECT THE LIABILITY OF DIRECTORS UNDER SECTION
1729.25 OF THE REVISED CODE. 1,424
(C) FOR PURPOSES OF DIVISION (A) OF THIS SECTION, A 1,426
DIRECTOR IS NOT AN INTERESTED DIRECTOR SOLELY BECAUSE THE SUBJECT 1,427
OF A CONTRACT OR TRANSACTION MAY INVOLVE OR EFFECT A CHANGE IN 1,428
CONTROL OF THE ASSOCIATION OR CONTINUATION IN OFFICE AS A 1,429
DIRECTOR OF THE ASSOCIATION.
Sec. 1729.25. (A) THE MEMBERS, THE DIRECTORS, AND THE 1,431
OFFICERS OF AN ASSOCIATION SHALL NOT BE PERSONALLY LIABLE FOR ANY 1,432
OBLIGATION OF THE ASSOCIATION. 1,433
(B)(1) DIRECTORS WHO VOTE FOR OR ASSENT TO ANY OF THE 1,435
FOLLOWING ARE JOINTLY AND SEVERALLY LIABLE TO THE ASSOCIATION IN 1,436
ACCORDANCE WITH DIVISION (B)(2) OF THIS SECTION: 1,437
(a) A DISTRIBUTION OF ASSETS TO MEMBERS, STOCKHOLDERS, OR 1,439
PATRONS CONTRARY TO LAW, THE ASSOCIATION'S ARTICLES OF 1,440
INCORPORATION, OR BYLAWS;
(b) A DISTRIBUTION OF ASSETS TO PERSONS OTHER THAN 1,442
CREDITORS DURING THE WINDING UP OF THE AFFAIRS OF THE 1,443
34
ASSOCIATION, ON DISSOLUTION OR OTHERWISE, WITHOUT THE PAYMENT OF 1,444
ALL KNOWN OBLIGATIONS OF THE ASSOCIATION, OR WITHOUT MAKING 1,445
ADEQUATE PROVISION FOR THE PAYMENT OF THE OBLIGATIONS;
(c) THE MAKING OF LOANS, OTHER THAN IN THE USUAL CONDUCT 1,447
OF THE ASSOCIATION'S AFFAIRS OR IN ACCORDANCE WITH THE 1,448
ASSOCIATION'S ARTICLES OR BYLAWS, TO AN OFFICER, DIRECTOR, OR 1,449
MEMBER OF THE ASSOCIATION.
(2)(a) IN CASES UNDER DIVISION (B)(1)(a) OF THIS SECTION, 1,452
UP TO THE AMOUNT OF THE DISTRIBUTION IN EXCESS OF THE AMOUNT THAT 1,453
COULD HAVE BEEN DISTRIBUTED WITHOUT VIOLATION OF LAW, THE
ARTICLES OF INCORPORATION, OR BYLAWS, BUT NOT IN EXCESS OF THE 1,454
AMOUNT THAT WOULD INURE TO THE BENEFIT OF THE CREDITORS OF THE 1,455
ASSOCIATION IF IT WAS INSOLVENT AT THE TIME OF THE DISTRIBUTION 1,456
OR THERE WAS REASONABLE GROUND TO BELIEVE THAT BY SUCH VOTE OR 1,457
ASSENT IT WOULD BE RENDERED INSOLVENT, OR TO THE BENEFIT OF THE
MEMBERS OR STOCKHOLDERS OTHER THAN MEMBERS OR STOCKHOLDERS OF THE 1,458
CLASS IN RESPECT OF WHICH THE DISTRIBUTION WAS MADE; 1,459
(b) IN CASES UNDER DIVISION (B)(1)(b) OF THIS SECTION, TO 1,462
THE EXTENT THAT THE OBLIGATIONS, NOT OTHERWISE BARRED BY STATUTE, 1,463
ARE NOT PAID, OR FOR THE PAYMENT OF WHICH ADEQUATE PROVISION HAS
NOT BEEN MADE; 1,464
(c) IN CASES UNDER DIVISION (B)(1)(c) OF THIS SECTION, FOR 1,467
THE AMOUNT OF THE LOAN WITH INTEREST THEREON AT THE RATE OF SIX 1,468
PER CENT PER YEAR UNTIL THE AMOUNT HAS BEEN PAID.
(3) A DIRECTOR IS NOT LIABLE UNDER DIVISION (B)(1)(a) OR 1,471
(b) OF THIS SECTION, IF IN DETERMINING THE AMOUNT AVAILABLE FOR 1,472
ANY SUCH DISTRIBUTION, THE DIRECTOR IN GOOD FAITH RELIED ON A 1,473
FINANCIAL STATEMENT OF THE ASSOCIATION PREPARED BY AN OFFICER OR 1,474
EMPLOYEE OF THE ASSOCIATION IN CHARGE OF ITS ACCOUNTS OR BY A 1,475
CERTIFIED PUBLIC ACCOUNTANT OR FIRM OF CERTIFIED PUBLIC
ACCOUNTANTS, OR IN GOOD FAITH CONSIDERED THE ASSETS TO BE OF 1,477
THEIR BOOK VALUE, OR FOLLOWED WHAT THE DIRECTOR BELIEVED TO BE 1,478
SOUND ACCOUNTING AND BUSINESS PRACTICE.
(C) A DIRECTOR WHO IS PRESENT AT A MEETING OF THE BOARD OR 1,480
35
A COMMITTEE OF THE BOARD AT WHICH ACTION ON ANY MATTER IS 1,481
AUTHORIZED OR TAKEN AND WHO HAS NOT VOTED FOR OR AGAINST SUCH 1,482
ACTION SHALL BE PRESUMED TO HAVE VOTED FOR THE ACTION UNLESS THE 1,483
DIRECTOR DISSENTS FROM THE ACTION DURING THE MEETING AND THE 1,484
DISSENT IS NOTED IN THE MINUTES OF THE PROCEEDINGS OF THE 1,485
MEETING, OR A WRITTEN DISSENT IS FILED EITHER DURING THE MEETING 1,487
OR WITHIN A REASONABLE TIME AFTER THE ADJOURNMENT OF THE MEETING. 1,488
(D) A MEMBER, STOCKHOLDER, OR PATRON WHO RECEIVES ANY 1,490
DISTRIBUTION MADE CONTRARY TO LAW, THE ASSOCIATION'S ARTICLES OF 1,491
INCORPORATION, OR BYLAWS IS LIABLE TO THE ASSOCIATION FOR THE 1,492
AMOUNT RECEIVED THAT IS IN EXCESS OF THE AMOUNT THAT COULD HAVE 1,493
BEEN DISTRIBUTED.
(E) A DIRECTOR AGAINST WHOM A CLAIM IS ASSERTED UNDER OR 1,495
PURSUANT TO THIS SECTION AND WHO IS HELD LIABLE ON THE CLAIM IS 1,496
ENTITLED TO CONTRIBUTION, ON EQUITABLE PRINCIPLES, FROM OTHER 1,497
DIRECTORS WHO ALSO ARE LIABLE. IN ADDITION, ANY DIRECTOR AGAINST 1,498
WHOM A CLAIM IS ASSERTED UNDER OR PURSUANT TO THIS SECTION, OR 1,499
WHO IS HELD LIABLE, HAS A RIGHT OF CONTRIBUTION FROM THE MEMBER, 1,500
STOCKHOLDER, OR PATRON WHO RECEIVED ANY DISTRIBUTION MADE
CONTRARY TO LAW, THE ARTICLES OF INCORPORATION, OR BYLAWS, AND 1,501
SUCH PERSONS AS AMONG THEMSELVES ALSO ARE ENTITLED TO 1,502
CONTRIBUTION IN PROPORTION TO THE AMOUNTS RECEIVED BY THEM 1,503
RESPECTIVELY.
(F) NO ACTION SHALL BE BROUGHT BY OR ON BEHALF OF AN 1,505
ASSOCIATION, UPON ANY CAUSE OF ACTION ARISING UNDER DIVISION 1,507
(B)(1)(a) OR (b) OF THIS SECTION, AT ANY TIME AFTER TWO YEARS 1,508
FROM THE DAY ON WHICH THE VIOLATION OCCURS; PROVIDED THAT NO SUCH 1,509
ACTION IS BARRED BY THIS DIVISION IF IT IS COMMENCED PRIOR TO THE
EFFECTIVE DATE OF THIS SECTION. 1,510
Sec. 1729.26. (A) THE OFFICERS OF AN ASSOCIATION SHALL 1,512
CONSIST OF A PRESIDENT, A SECRETARY, A TREASURER, AND, IF 1,513
DESIRED, A CHAIRPERSON OF THE BOARD, ONE OR MORE VICE-PRESIDENTS, 1,514
AND SUCH OTHER OFFICERS AND ASSISTANT OFFICERS AS NECESSARY. THE 1,515
OFFICERS SHALL BE ELECTED BY THE BOARD. THE CHAIRPERSON OF THE 1,516
36
BOARD SHALL BE A DIRECTOR. UNLESS THE ASSOCIATION'S ARTICLES OF 1,517
INCORPORATION OR BYLAWS PROVIDE OTHERWISE, NONE OF THE OTHER 1,518
OFFICERS NEED BE A DIRECTOR. ANY TWO OR MORE OFFICES MAY BE HELD 1,519
BY THE SAME PERSON, BUT NO OFFICER SHALL EXECUTE, ACKNOWLEDGE, OR 1,520
VERIFY ANY INSTRUMENT IN MORE THAN ONE CAPACITY IF THE INSTRUMENT 1,521
IS REQUIRED BY LAW OR BY THE ARTICLES OR BYLAWS TO BE EXECUTED,
ACKNOWLEDGED, OR VERIFIED BY TWO OR MORE OFFICERS. UNLESS THE 1,522
ARTICLES OR THE BYLAWS PROVIDE OTHERWISE, ALL OFFICERS SHALL BE 1,523
ELECTED ANNUALLY.
(B) ALL OFFICERS SHALL HAVE THE AUTHORITY TO PERFORM, AND 1,525
SHALL PERFORM, THE DUTIES AS THE BYLAWS PROVIDE, OR AS THE BOARD 1,526
MAY DETERMINE IN ACCORDANCE WITH THE BYLAWS. 1,527
Sec. 1729.15 1729.27. Every IF REQUIRED BY THE 1,536
ASSOCIATION'S BYLAWS, EVERY officer, employee, and agent handling 1,537
funds, negotiable instruments, or other property of or for an 1,539
association shall execute and deliver adequate bonds for the 1,540
faithful performance of his THE OFFICER'S, EMPLOYEE'S, OR AGENT'S 1,541
duties and obligations.
Sec. 1729.16 1729.28. (A) Any member of an association 1,551
may bring charges against an officer or director of the 1,553
association by filing them in writing with the secretary of the 1,554
association, together with a petition, signed by five TWENTY per 1,555
cent of the members, requesting the removal of the officer or 1,556
director in question. The removal shall be voted upon at the 1,557
next regular or special meeting of the association and, by a vote 1,558
of a majority of the members, the association may remove the 1,559
officer or director and fill the vacancy. The director or 1,560
officer against whom such charges are brought shall be informed
in writing of the charges previous to the meeting and shall have 1,561
an opportunity at the meeting to be heard in person or by counsel 1,562
and to present witnesses, and the persons bringing the charges 1,563
against him THE DIRECTOR OR OFFICER shall have the same 1,564
opportunity.
(B) In case the bylaws provide for election of directors 1,566
37
by districts with primary elections in each district OR OTHER 1,568
GROUPING, then the petition for removal of a director must be 1,570
signed by twenty per cent of the members residing in the district
OR BELONGING TO THE GROUP from which he THE DIRECTOR was elected. 1,573
The board of directors shall then call a special meeting of the 1,575
members residing in that district OR BELONGING TO THE GROUP to 1,576
consider AND VOTE UPON the removal of the director; and at such 1,577
meeting, by a vote of the majority of the members of that 1,578
district OR BELONGING TO THE GROUP, the director in question 1,579
shall be removed from office. 1,580
Sec. 1729.29. (A) AN ASSOCIATION SHALL KEEP CORRECT AND 1,582
COMPLETE BOOKS AND RECORDS OF ACCOUNT, AND SHALL ALSO KEEP 1,583
MINUTES OF THE PROCEEDINGS OF MEETINGS OF ITS MEMBERS, BOARD, AND 1,584
DELEGATES. THE ASSOCIATION SHALL KEEP AT ITS PRINCIPAL OFFICE 1,585
RECORDS OF THE NAMES AND ADDRESSES OF ALL MEMBERS AND 1,586
STOCKHOLDERS WITH THE AMOUNT OF OWNERSHIP INTERESTS AND STOCK 1,587
HELD BY EACH.
(B) AT ANY REASONABLE TIME, ANY MEMBER, UPON WRITTEN 1,589
NOTICE THAT STATES A PROPER PURPOSE FOR AN EXAMINATION OF BOOKS 1,590
AND RECORDS AND THAT IS DELIVERED OR SENT TO THE ASSOCIATION AT 1,591
LEAST ONE WEEK IN ADVANCE, MAY EXAMINE THOSE BOOKS AND RECORDS 1,592
PERTINENT TO THE PURPOSE IN THE NOTICE. THE BOARD MAY DENY A 1,593
REQUEST OF A MEMBER TO EXAMINE THE BOOKS AND RECORDS IF THE
PURPOSE IS NOT PROPER BECAUSE THE PURPOSE IS NOT DIRECTLY RELATED 1,594
TO THE PERSON'S INTEREST AS A MEMBER AND IS CONTRARY TO THE BEST 1,595
INTERESTS OF THE ASSOCIATION.
(C) AT ANY REASONABLE TIME, A STOCKHOLDER WHO IS NOT A 1,597
MEMBER, UPON WRITTEN NOTICE THAT STATES A PROPER PURPOSE FOR AN 1,598
EXAMINATION OF BOOKS AND RECORDS AND THAT IS DELIVERED OR SENT TO 1,599
THE ASSOCIATION AT LEAST ONE WEEK IN ADVANCE, MAY EXAMINE THOSE 1,600
BOOKS AND RECORDS THAT ARE PERTINENT TO THE PURPOSE IN THE 1,601
NOTICE. THE BOARD MAY DENY A REQUEST OF A STOCKHOLDER TO EXAMINE 1,602
THE BOOKS AND RECORDS IF THE PURPOSE IS NOT PROPER BECAUSE THE
PURPOSE IS NOT DIRECTLY RELATED TO THE PERSON'S INTEREST AS A 1,603
38
STOCKHOLDER AND IS CONTRARY TO THE BEST INTEREST OF THE 1,604
ASSOCIATION.
Sec. 1729.35. (A) AN ASSOCIATION MAY MERGE OR CONSOLIDATE 1,606
WITH ONE OR MORE ASSOCIATIONS UNDER THIS CHAPTER. BEFORE AN 1,607
ASSOCIATION MAY MERGE OR CONSOLIDATE WITH ANY OTHER ASSOCIATION, 1,608
A WRITTEN AGREEMENT OF MERGER OR CONSOLIDATION SHALL BE APPROVED 1,609
BY THE BOARD OF EACH CONSTITUENT ASSOCIATION AND BY THE MEMBERS 1,610
OF EACH CONSTITUENT ASSOCIATION. THE AGREEMENT SHALL SET FORTH 1,611
THE TERMS OF THE MERGER OR CONSOLIDATION, INCLUDING ANY 1,612
PROVISIONS FOR AMENDMENT OR ABANDONMENT OF THE AGREEMENT. IN THE 1,613
CASE OF A CONSOLIDATION, THE AGREEMENT ALSO SHALL CONTAIN THE
ARTICLES OF INCORPORATION OF THE NEW ASSOCIATION. 1,614
(B)(1) IF THE AGREEMENT OF MERGER OR CONSOLIDATION 1,616
PROVIDES THAT A HOLDER OF STOCK OTHER THAN MEMBERSHIP STOCK OR 1,617
PATRONAGE STOCK IN A CONSTITUENT ASSOCIATION WILL BE AFFECTED, 1,618
ALL OF THE FOLLOWING APPLY:
(a) UNLESS THE BOARD OF THE CONSTITUENT ASSOCIATION 1,620
PROVIDES THAT DIVISION (B)(1)(b) OF THIS SECTION APPLIES, THE 1,621
AFFECTED STOCKHOLDER SHALL BE ENTITLED TO CAST ONE VOTE ON THE 1,622
AGREEMENT REGARDLESS OF THE PAR OR STATED VALUE, THE NUMBER OF 1,623
SHARES, OR THE NUMBER OF AFFECTED CLASSES OF THE STOCK HELD. 1,624
(b) THE BOARD OF A CONSTITUENT ASSOCIATION MAY PROVIDE 1,626
THAT A STOCKHOLDER OTHERWISE ENTITLED TO VOTE UNDER DIVISION 1,628
(B)(1)(a) OF THIS SECTION SHALL INSTEAD BE ENTITLED TO PAYMENT OF 1,629
FAIR CASH VALUE OF THE AFFECTED STOCK HELD BY THE STOCKHOLDER IN
ACCORDANCE WITH SECTION 1729.46 OF THE REVISED CODE. 1,630
(c) A MEMBER HOLDING STOCK AFFECTED BY A PROPOSED 1,632
AGREEMENT OF MERGER OR CONSOLIDATION MAY VOTE ONLY AS A MEMBER 1,633
AND SHALL NOT BE ENTITLED TO VOTE OR DEMAND FAIR CASH VALUE AS AN 1,634
AFFECTED STOCKHOLDER.
(2) FOR PURPOSES OF THIS SECTION, A HOLDER OF STOCK IS 1,636
AFFECTED AS TO ANY CLASS OF STOCK OWNED BY THE HOLDER ONLY IF THE 1,637
AGREEMENT OF MERGER OR CONSOLIDATION DOES ANY OF THE FOLLOWING: 1,638
(a) DECREASES THE DIVIDENDS TO WHICH THAT CLASS MAY BE 1,640
39
ENTITLED OR CHANGES THE METHOD BY WHICH THE DIVIDEND RATE ON THAT 1,641
CLASS IS FIXED;
(b) PROVIDES FOR ADDITIONAL RESTRICTION OF RIGHTS TO 1,643
TRANSFER SHARES OF THAT CLASS; 1,644
(c) GIVES TO ANOTHER EXISTING OR ANY NEW CLASS OF STOCK OR 1,646
EQUITY INTEREST NOT PREVIOUSLY ENTITLED THERETO ANY PREFERENCE, 1,647
AS TO DIVIDENDS OR UPON DISSOLUTION, THAT IS HIGHER THAN 1,648
PREFERENCES OF THAT CLASS;
(d) CHANGES THE PAR VALUE OF SHARES OF THAT CLASS OR OF 1,650
ANY OTHER CLASS HAVING THE SAME OR HIGHER PREFERENCES AS TO 1,651
DIVIDENDS OR UPON DISSOLUTION; 1,652
(e) INCREASES THE NUMBER OF AUTHORIZED SHARES OF ANY OTHER 1,654
CLASS HAVING THE SAME OR HIGHER PREFERENCES AS TO DIVIDENDS OR 1,655
UPON DISSOLUTION BEYOND THE AGGREGATE AUTHORIZATIONS FOR SUCH 1,656
CLASSES IN THE CONSTITUENT ASSOCIATIONS; 1,657
(f) REQUIRES OR PERMITS AN EXCHANGE OF SHARES OF ANY CLASS 1,659
WITH LOWER PREFERENCES AS TO DIVIDENDS OR UPON DISSOLUTION FOR 1,660
SHARES OF ANY OTHER CLASS WITH HIGHER PREFERENCES. 1,661
(C) THE AGREEMENT IS APPROVED IF BOTH OF THE FOLLOWING 1,663
CONDITIONS ARE MET WITH RESPECT TO EACH CONSTITUENT ASSOCIATION: 1,664
(1) NOTICE OF THE MEETING TO VOTE ON THE AGREEMENT, THE 1,666
AGREEMENT, AND A DESCRIPTION OF THE METHOD OF VOTING HAVE BEEN 1,667
SENT TO ALL MEMBERS, AND TO ALL AFFECTED STOCKHOLDERS ENTITLED 1,668
EITHER TO VOTE ON THE AGREEMENT OR TO RECEIVE PAYMENT OF FAIR 1,669
CASH VALUE UNDER DIVISION (B) OF THIS SECTION; 1,670
(2) SIXTY PER CENT OF THE MEMBER VOTES CAST APPROVE THE 1,672
AGREEMENT, AND A SIMPLE MAJORITY OF THE VOTES CAST BY THE 1,673
AFFECTED STOCKHOLDERS ENTITLED TO VOTE UNDER DIVISION (B) OF THIS 1,675
SECTION APPROVE THE AGREEMENT.
(D) NOTWITHSTANDING DIVISION (C) OF THIS SECTION, NO VOTE 1,678
OF THE MEMBERS OR STOCKHOLDERS OF A CONSTITUENT ASSOCIATION SHALL
BE NECESSARY TO APPROVE A MERGER OF A WHOLLY OWNED SUBSIDIARY 1,679
ASSOCIATION WITH AND INTO ITS PARENT ASSOCIATION OR A MERGER OR A 1,680
CONSOLIDATION OF TWO OR MORE SUBSIDIARY ASSOCIATIONS THAT ARE 1,681
40
WHOLLY OWNED BY AN ASSOCIATION.
(E) AFTER APPROVAL OF AN AGREEMENT UNDER THIS SECTION, BUT 1,683
BEFORE THE MERGER OR CONSOLIDATION IS EFFECTIVE, THE AGREEMENT 1,684
MAY BE AMENDED IN ACCORDANCE WITH ANY PROVISION FOR AMENDMENT SET 1,685
FORTH IN THE AGREEMENT, PROVIDED THAT AN AMENDMENT MADE 1,686
SUBSEQUENT TO ADOPTION OF THE AGREEMENT BY THE MEMBERS OF ANY 1,687
CONSTITUENT ASSOCIATION SHALL NOT DO ANY OF THE FOLLOWING:
(1) CHANGE THE MEMBERSHIP RIGHTS, OR THE AMOUNT OR KIND OF 1,689
STOCK, SECURITIES, CASH, PROPERTY, OR OTHER RIGHTS TO BE 1,690
RECEIVED, EXCHANGED, OR CONVERTED IN THE MERGER OR CONSOLIDATION; 1,691
(2) CHANGE THE ARTICLES OF INCORPORATION OR BYLAWS OF THE 1,693
SURVIVING OR NEW ASSOCIATION AS PROVIDED FOR IN THE AGREEMENT; 1,694
(3) CHANGE ANY PROVISION OF THE AGREEMENT WITH RESPECT TO 1,696
THE RIGHTS OF MEMBERS OR THE MANNER OF VOTING IN THE SURVIVING OR 1,697
NEW ASSOCIATION.
(F) AFTER APPROVAL OF AN AGREEMENT UNDER THIS SECTION, BUT 1,699
BEFORE THE MERGER OR CONSOLIDATION IS EFFECTIVE, THE MERGER OR 1,700
CONSOLIDATION MAY BE ABANDONED IN ACCORDANCE WITH ANY PROVISION 1,701
FOR ABANDONMENT SET FORTH IN THE AGREEMENT. 1,702
(G) THE MERGER OR CONSOLIDATION SHALL TAKE EFFECT IN 1,704
ACCORDANCE WITH SECTIONS 1729.37 AND 1729.38 OF THE REVISED CODE. 1,705
Sec. 1729.36. (A) AN ASSOCIATION MAY MERGE OR CONSOLIDATE 1,707
WITH ONE OR MORE ENTITIES, IF SUCH MERGER OR CONSOLIDATION IS 1,708
PERMITTED BY THE LAWS UNDER WHICH EACH CONSTITUENT ENTITY EXISTS 1,709
AND THE ASSOCIATION COMPLIES WITH THIS SECTION. 1,710
(B) EACH CONSTITUENT ASSOCIATION SHALL COMPLY WITH SECTION 1,712
1729.35 OF THE REVISED CODE WITH RESPECT TO FORM AND APPROVAL OF 1,713
AN AGREEMENT OF MERGER OR CONSOLIDATION, AND EACH CONSTITUENT 1,714
ENTITY SHALL COMPLY WITH THE APPLICABLE PROVISIONS OF THE LAWS 1,715
UNDER WHICH IT EXISTS, EXCEPT THAT THE AGREEMENT OF MERGER OR 1,716
CONSOLIDATION, BY WHATEVER NAME DESIGNATED, SHALL COMPLY WITH
DIVISIONS (C) AND (D) OF THIS SECTION. 1,717
(C) THE AGREEMENT OF MERGER OR CONSOLIDATION SHALL SET 1,719
FORTH ALL OF THE FOLLOWING: 1,720
41
(1) THE NAMES OF THE STATES AND THE LAWS UNDER WHICH EACH 1,722
CONSTITUENT ENTITY EXISTS; 1,723
(2) ALL STATEMENTS AND MATTERS REQUIRED TO BE SET FORTH IN 1,725
AGREEMENTS OF MERGER OR CONSOLIDATION BY THE LAWS UNDER WHICH ANY 1,726
CONSTITUENT ENTITY EXISTS;
(3) A STATEMENT THAT THE SURVIVING OR NEW ENTITY IS TO BE 1,728
AN ASSOCIATION, CORPORATION, OR LIMITED LIABILITY COMPANY; 1,729
(4) IF THE SURVIVING OR NEW ENTITY IS TO BE A FOREIGN 1,731
ENTITY:
(a) THE PLACE WHERE THE PRINCIPAL OFFICE OF THE SURVIVING 1,733
OR NEW ENTITY IS TO BE LOCATED IN THE STATE IN WHICH THE 1,734
SURVIVING OR NEW ENTITY IS TO EXIST; 1,735
(b) THE CONSENT BY THE SURVIVING OR NEW ENTITY THAT IT MAY 1,737
BE SUED AND SERVED WITH PROCESS IN THIS STATE IN ANY PROCEEDING 1,739
FOR THE ENFORCEMENT OF ANY OBLIGATION OF ANY CONSTITUENT 1,740
ASSOCIATION OR DOMESTIC ENTITY;
(c) THE CONSENT BY THE SURVIVING OR NEW ENTITY THAT IT 1,742
SHALL BE SUBJECT TO THE APPLICABLE PROVISIONS OF CHAPTER 1703. OF 1,744
THE REVISED CODE, IF IT IS A FOREIGN CORPORATION OR FOREIGN 1,747
ASSOCIATION, OR TO SECTIONS 1705.53 TO 1705.58 OF THE REVISED 1,749
CODE, IF IT IS A FOREIGN LIMITED LIABILITY COMPANY; 1,750
(d) IF IT IS DESIRED THAT THE SURVIVING OR NEW ENTITY 1,752
EXERCISE ITS CORPORATE PRIVILEGES IN THIS STATE AS A FOREIGN 1,753
ENTITY. 1,754
(D) THE AGREEMENT MAY ALSO SET FORTH OTHER PROVISIONS 1,756
PERMITTED BY THE LAWS OF ANY STATE IN WHICH ANY CONSTITUENT 1,757
ENTITY EXISTS.
(E) IF THE SURVIVING OR NEW ENTITY IS AN ASSOCIATION, THE 1,759
MERGER OR CONSOLIDATION SHALL TAKE EFFECT IN ACCORDANCE WITH 1,760
SECTIONS 1729.37 AND 1729.38 OF THE REVISED CODE. 1,761
(F) IF THE SURVIVING OR NEW ENTITY IS AN ENTITY OTHER THAN 1,763
AN ASSOCIATION, THE MERGER OR CONSOLIDATION SHALL TAKE EFFECT IN 1,764
ACCORDANCE WITH THE APPLICABLE PROVISIONS OF THE LAWS UNDER WHICH 1,765
IT EXISTS.
42
Sec. 1729.37. (A) UNLESS A LATER DATE IS SPECIFIED IN THE 1,767
AGREEMENT, A MERGER OR CONSOLIDATION UNDER SECTIONS 1729.35 AND 1,769
1729.36 OF THE REVISED CODE IS EFFECTIVE WHEN THE CERTIFICATE OF 1,770
MERGER OR CONSOLIDATION IS FILED IN ACCORDANCE WITH SECTION 1,771
1729.38 OF THE REVISED CODE. IF, AFTER FILING THE CERTIFICATE
BUT BEFORE THE MERGER OR CONSOLIDATION IS EFFECTIVE, THE MERGER 1,772
OR CONSOLIDATION IS AMENDED OR ABANDONED, AS PROVIDED IN 1,773
DIVISIONS (E) AND (F) OF SECTION 1729.35 OF THE REVISED CODE, AN 1,774
AUTHORIZED OFFICER OF EACH CONSTITUENT ASSOCIATION SHALL SIGN A 1,775
CERTIFICATE OF AMENDMENT OR ABANDONMENT STATING THAT THE 1,776
AGREEMENT OF MERGER OR CONSOLIDATION HAS BEEN AMENDED OR 1,777
ABANDONED AND THE DATE OF SUCH ACTION, AND SHALL FILE THE 1,778
CERTIFICATE IN THE SAME MANNER AS THE CERTIFICATE OF MERGER OR 1,779
CONSOLIDATION. ANY CERTIFICATE OF AMENDMENT OR ABANDONMENT SHALL
BE FILED PRIOR TO THE DATE THE MERGER OR CONSOLIDATION WOULD 1,780
OTHERWISE BE EFFECTIVE.
(B) IN THE CASE OF A MERGER, THE SURVIVING ASSOCIATION OR 1,782
ENTITY IS THE ONE DESIGNATED IN THE AGREEMENT. IN THE CASE OF A 1,783
CONSOLIDATION, THE NEW ASSOCIATION OR ENTITY IS THE ONE 1,784
DESIGNATED IN THE AGREEMENT. THE SEPARATE EXISTENCE OF ALL 1,785
CONSTITUENT ASSOCIATIONS OR ENTITIES IN THE AGREEMENT, EXCEPT THE 1,786
SURVIVING OR NEW ASSOCIATION OR ENTITY, CEASES UPON THE EFFECTIVE 1,787
DATE OF THE MERGER OR CONSOLIDATION.
(C) THE SURVIVING OR NEW ASSOCIATION OR ENTITY POSSESSES 1,789
ALL THE RIGHTS AND ALL THE PROPERTY OF EACH CONSTITUENT 1,790
ASSOCIATION OR ENTITY, AND IS RESPONSIBLE FOR ALL THEIR 1,791
OBLIGATIONS. TITLE TO ANY PROPERTY IS VESTED IN THE SURVIVING OR 1,792
NEW ASSOCIATION OR ENTITY WITH NO REVERSION OR IMPAIRMENT OF THE
PROPERTY CAUSED BY THE MERGER OR CONSOLIDATION. A MERGER OR 1,793
CONSOLIDATION SHALL NOT BE CONSIDERED AN ASSIGNMENT. NO RIGHT OF 1,794
ANY CREDITOR SHALL BE IMPAIRED BY THE MERGER OR CONSOLIDATION 1,795
WITHOUT THE CREDITOR'S CONSENT.
(D) IF THE SURVIVING ORGANIZATION IS AN ASSOCIATION, THE 1,797
ARTICLES OF INCORPORATION ARE AMENDED TO THE EXTENT PROVIDED IN 1,798
43
THE AGREEMENT OF MERGER. 1,799
Sec. 1729.38. (A)(1) UPON ADOPTION OF AN AGREEMENT OF 1,801
MERGER OR CONSOLIDATION UNDER SECTION 1729.35 OR 1729.36 OF THE 1,802
REVISED CODE, A CERTIFICATE, SIGNED BY ANY AUTHORIZED OFFICER OF 1,803
EACH CONSTITUENT ASSOCIATION OR ENTITY, SHALL BE FILED WITH THE 1,805
SECRETARY OF STATE ON A FORM PRESCRIBED BY THE SECRETARY OF STATE 1,806
THAT SETS FORTH THE FOLLOWING: 1,807
(a) THE NAME AND FORM OF EACH CONSTITUENT ASSOCIATION OR 1,809
ENTITY AND THE STATE LAW UNDER WHICH EACH CONSTITUENT ENTITY 1,810
EXISTS;
(b) A STATEMENT THAT EACH CONSTITUENT ASSOCIATION OR 1,812
ENTITY HAS ADOPTED THE AGREEMENT OF MERGER OR CONSOLIDATION, THE 1,813
MANNER OF ADOPTION, AND THAT THE AGREEMENT WAS ADOPTED IN 1,814
COMPLIANCE WITH THE LAWS APPLICABLE TO EACH CONSTITUENT 1,815
ASSOCIATION OR ENTITY;
(c) THE EFFECTIVE DATE OF THE MERGER OR CONSOLIDATION, 1,817
WHICH DATE MAY BE ON OR AFTER THE DATE OF FILING OF THE 1,818
CERTIFICATE;
(d) IN THE CASE OF A MERGER, A STATEMENT THAT ONE OR MORE 1,820
SPECIFIED CONSTITUENT ASSOCIATIONS OR ENTITIES WILL BE MERGED 1,821
INTO A SPECIFIED SURVIVING ASSOCIATION OR ENTITY, OR, IN THE CASE 1,822
OF A CONSOLIDATION, A STATEMENT THAT THE CONSTITUENT ASSOCIATIONS 1,823
OR ENTITIES WILL BE CONSOLIDATED INTO A NEW ASSOCIATION OR 1,824
ENTITY;
(e) THE NAME AND ADDRESS OF THE STATUTORY AGENT UPON WHOM 1,826
ANY PROCESS, NOTICE, OR DEMAND AGAINST ANY CONSTITUENT 1,827
ASSOCIATION OR ENTITY, OR THE SURVIVING OR NEW ASSOCIATION OR 1,828
ENTITY MAY BE SERVED.
(2) IN THE CASE OF A MERGER INTO AN ASSOCIATION OR 1,830
DOMESTIC ENTITY, ANY AMENDMENTS TO THE ARTICLES OF INCORPORATION 1,831
OR THE ARTICLES OR ORGANIZATION OF THE SURVIVING ASSOCIATION OR 1,832
ENTITY SHALL BE FILED WITH THE CERTIFICATE.
(3) IN THE CASE OF A CONSOLIDATION TO FORM A NEW DOMESTIC 1,834
ASSOCIATION OR ENTITY, THE ARTICLES OF INCORPORATION OR THE 1,835
44
ARTICLES OF ORGANIZATION OF THE NEW ASSOCIATION OR ENTITY SHALL 1,836
BE FILED WITH THE CERTIFICATE.
(4) IF THE SURVIVING OR NEW ENTITY IS A FOREIGN ENTITY 1,838
THAT DESIRES TO TRANSACT BUSINESS IN THIS STATE AS A FOREIGN 1,839
ENTITY, THE CERTIFICATE SHALL BE ACCOMPANIED BY THE INFORMATION 1,840
REQUIRED FOR QUALIFICATION OF A FOREIGN ENTITY IN THIS STATE BY 1,841
CHAPTER 1703. OF THE REVISED CODE, IN THE CASE OF A FOREIGN
CORPORATION OR FOREIGN COOPERATIVE, OR BY SECTIONS 1705.53 AND 1,842
1705.54 OF THE REVISED CODE, IN THE CASE OF A FOREIGN LIMITED 1,843
LIABILITY COMPANY.
(B) A COPY OF THE CERTIFICATE OF MERGER OR CONSOLIDATION, 1,845
CERTIFIED BY THE SECRETARY OF STATE, MAY BE FILED FOR RECORD IN 1,846
THE OFFICE OF THE COUNTY RECORDER OF ANY COUNTY IN THIS STATE. 1,847
FOR SUCH RECORDING THE COUNTY RECORDER SHALL CHARGE AND COLLECT 1,848
THE SAME FEE AS IN THE CASE OF DEEDS. THE CERTIFIED COPY OF THE 1,849
CERTIFICATE OF MERGER OR CONSOLIDATION SHALL BE RECORDED IN THE 1,850
RECORDS OF DEEDS.
(C) FOR PURPOSES OF THIS SECTION, "DOMESTIC ENTITY" MEANS 1,853
A CORPORATION OR LIMITED LIABILITY COMPANY ORGANIZED UNDER THE 1,854
LAWS OF THIS STATE.
Sec. 1729.40. (A) ANY ASSOCIATION MAY DIVIDE ITSELF INTO 1,856
TWO OR MORE ASSOCIATIONS. A WRITTEN PLAN OF DIVISION SHALL BE 1,857
APPROVED BY THE ASSOCIATION'S BOARD. SUCH PLAN SHALL SET FORTH 1,858
ALL THE TERMS OF THE DIVISION AND THE PROPOSED EFFECT OF THE 1,859
DIVISION ON ALL MEMBERS AND STOCKHOLDERS OF THE ASSOCIATION. THE 1,860
PLAN ALSO SHALL CONTAIN THE ARTICLES OF INCORPORATION AND BYLAWS 1,861
OF EACH ASSOCIATION RESULTING FROM THE DIVISION, WHICH ARTICLES 1,862
AND BYLAWS SHALL CONFORM TO THE REQUIREMENTS FOR ASSOCIATIONS 1,863
ORGANIZED UNDER THIS CHAPTER. 1,864
(B)(1) IF THE PLAN OF DIVISION PROVIDES THAT A HOLDER OF 1,866
STOCK OTHER THAN MEMBERSHIP STOCK OR PATRONAGE STOCK WILL BE 1,867
AFFECTED, THE FOLLOWING APPLY: 1,868
(a) UNLESS THE BOARD PROVIDES THAT DIVISION (B)(1)(b) OF 1,871
THIS SECTION APPLIES, THE AFFECTED STOCKHOLDER SHALL BE ENTITLED 1,872
45
TO CAST ONE VOTE ON THE PLAN OF DIVISION REGARDLESS OF THE PAR OR 1,873
STATED VALUE, THE NUMBER OF SHARES, OR THE NUMBER OF AFFECTED 1,874
CLASSES OF THE STOCK HELD.
(b) THE BOARD MAY PROVIDE THAT A STOCKHOLDER OTHERWISE 1,876
ENTITLED TO VOTE UNDER DIVISION (B)(1)(a) OF THIS SECTION SHALL 1,878
INSTEAD BE ENTITLED TO PAYMENT OF FAIR CASH VALUE OF THE AFFECTED
STOCK HELD BY THE STOCKHOLDER IN ACCORDANCE WITH SECTION 1729.46 1,879
OF THE REVISED CODE.
(c) A MEMBER HOLDING STOCK AFFECTED BY A PROPOSED PLAN OF 1,881
DIVISION MAY VOTE ONLY AS A MEMBER AND SHALL NOT BE ENTITLED TO 1,882
VOTE OR DEMAND FAIR CASH VALUE AS AN AFFECTED STOCKHOLDER. 1,883
(2) FOR PURPOSES OF THIS SECTION, A HOLDER OF STOCK IS 1,885
AFFECTED AS TO ANY CLASS OF STOCK OWNED BY THE HOLDER ONLY IF THE 1,886
PLAN OF DIVISION DOES ANY OF THE FOLLOWING: 1,887
(a) DECREASES THE DIVIDENDS TO WHICH THAT CLASS MAY BE 1,889
ENTITLED OR CHANGES THE METHOD BY WHICH THE DIVIDEND RATE ON THAT 1,890
CLASS IS FIXED;
(b) PROVIDES ANY ADDITIONAL RESTRICTION ON RIGHTS TO 1,892
TRANSFER SHARES OF THAT CLASS; 1,893
(c) GIVES TO ANOTHER EXISTING OR ANY NEW CLASS OF STOCK OR 1,895
EQUITY INTEREST NOT PREVIOUSLY ENTITLED THERETO ANY PREFERENCE, 1,896
AS TO DIVIDENDS OR UPON DISSOLUTION, THAT IS HIGHER THAN 1,897
PREFERENCES OF THAT CLASS IN A RESULTING ASSOCIATION; 1,898
(d) CHANGES THE PAR VALUE OF SHARES OF THAT CLASS OR OF 1,900
ANY OTHER CLASS HAVING THE SAME OR HIGHER PREFERENCES AS TO 1,901
DIVIDENDS OR UPON DISSOLUTION; 1,902
(e) INCREASES THE AGGREGATE NUMBER OF AUTHORIZED SHARES OF 1,904
ANY OTHER CLASS HAVING THE SAME OR HIGHER PREFERENCES AS TO 1,905
DIVIDENDS OR UPON DISSOLUTION IN THE RESULTING ASSOCIATIONS 1,906
BEYOND THE AUTHORIZATION FOR SUCH CLASSES IN THE ORIGINAL 1,907
ASSOCIATION;
(f) REQUIRES OR PERMITS AN EXCHANGE OF SHARES OF ANY CLASS 1,909
WITH LOWER PREFERENCES AS TO DIVIDENDS OR UPON DISSOLUTION IN THE 1,910
ORIGINAL ASSOCIATION FOR SHARES OF ANY OTHER CLASS WITH HIGHER 1,912
46
PREFERENCES IN A RESULTING ASSOCIATION.
(C) THE PLAN OF DIVISION IS APPROVED IF BOTH OF THE 1,914
FOLLOWING CONDITIONS ARE MET: 1,915
(1) NOTICE OF THE MEETING TO VOTE ON THE PLAN, THE PLAN OF 1,917
DIVISION, AND A DESCRIPTION OF THE METHOD OF VOTING HAVE BEEN 1,918
SENT TO ALL MEMBERS AND TO ALL AFFECTED STOCKHOLDERS ENTITLED 1,919
EITHER TO VOTE ON THE PLAN OR TO RECEIVE PAYMENT OF FAIR CASH 1,920
VALUE UNDER DIVISION (B) OF THIS SECTION;
(2) SIXTY PER CENT OF THE MEMBER VOTES CAST APPROVE THE 1,922
PLAN, AND A SIMPLE MAJORITY OF THE VOTES CAST BY THE AFFECTED 1,923
STOCKHOLDERS ENTITLED TO VOTE UNDER DIVISION (B) OF THIS SECTION 1,924
APPROVE THE PLAN.
(D) AFTER APPROVAL OF A PLAN OF DIVISION UNDER THIS 1,926
SECTION, BUT BEFORE THE DIVISION IS EFFECTIVE, THE PLAN MAY BE 1,927
AMENDED OR ABANDONED IN ACCORDANCE WITH A PROVISION FOR AMENDMENT 1,928
OR ABANDONMENT SET FORTH IN THE PLAN, PROVIDED THAT AN AMENDMENT 1,929
MADE SUBSEQUENT TO APPROVAL OF THE PLAN BY THE MEMBERS SHALL NOT 1,930
DO ANY OF THE FOLLOWING:
(1) CHANGE THE MEMBERSHIP RIGHTS, OR THE AMOUNT OR KIND OF 1,932
STOCK, SECURITIES, CASH, PROPERTY, OR OTHER RIGHTS TO BE 1,933
RECEIVED, EXCHANGED, OR CONVERTED IN THE DIVISION; 1,934
(2) CHANGE THE ARTICLES OF INCORPORATION OR BYLAWS OF THE 1,936
RESULTING ASSOCIATIONS AS PROVIDED FOR IN THE PLAN; 1,937
(3) CHANGE ANY PROVISION OF THE PLAN WITH RESPECT TO THE 1,939
RIGHTS OF MEMBERS OR THE MANNER OF VOTING IN THE RESULTING 1,940
ASSOCIATIONS.
(E)(1) UPON APPROVAL OF A PLAN OF DIVISION, A CERTIFICATE, 1,942
SIGNED BY ANY AUTHORIZED OFFICER OF THE ORIGINAL ASSOCIATION, 1,943
SHALL BE FILED WITH THE SECRETARY OF STATE ON A FORM PRESCRIBED 1,944
BY THE SECRETARY OF STATE SETTING FORTH THE FOLLOWING: 1,945
(a) THE NAME OF THE ORIGINAL ASSOCIATION AND THE NAME OF 1,947
EACH RESULTING ASSOCIATION; 1,948
(b) A STATEMENT THAT THE ORIGINAL ASSOCIATION HAS ADOPTED 1,950
THE PLAN OF DIVISION, THE MANNER OF ADOPTION, AND THAT THE PLAN 1,951
47
WAS ADOPTED IN COMPLIANCE WITH THIS SECTION; 1,952
(c) THE EFFECTIVE DATE OF THE DIVISION, WHICH DATE MAY BE 1,954
ON OR AFTER THE DATE OF FILING OF THE CERTIFICATE; 1,955
(d) A STATEMENT THAT THE ORIGINAL ASSOCIATION WILL BE 1,957
DIVIDED INTO SPECIFIED RESULTING ASSOCIATIONS; 1,958
(e) THE NAME AND ADDRESS OF THE STATUTORY AGENT UPON WHOM 1,960
ANY PROCESS, NOTICE, OR DEMAND AGAINST THE ORIGINAL ASSOCIATION 1,961
MAY BE SERVED, AND THE NAME AND ADDRESS OF A STATUTORY AGENT FOR 1,962
EACH RESULTING ASSOCIATION UPON WHOM PROCESS, NOTICE, OR DEMAND 1,963
AGAINST THAT RESULTING ASSOCIATION MAY BE SERVED. 1,964
(2) THE ARTICLES OF INCORPORATION OF EACH OF THE RESULTING 1,966
ASSOCIATIONS SHALL BE FILED WITH THE CERTIFICATE. 1,967
Sec. 1729.42. (A) A DOMESTIC CORPORATION MAY CONVERT 1,969
ITSELF INTO AN ASSOCIATION BY ADOPTING AN AMENDMENT TO ITS 1,970
ARTICLES OF INCORPORATION IN WHICH IT ELECTS TO BECOME SUBJECT TO 1,971
THIS CHAPTER, TOGETHER WITH ANY CHANGES IN ITS ARTICLES OF 1,972
INCORPORATION AND BYLAWS REQUIRED BY THIS CHAPTER, AND ANY OTHER 1,973
DESIRABLE CHANGES PERMITTED BY THIS CHAPTER. THE AMENDMENT SHALL
BE ADOPTED, FILED, AND RECORDED IN THE MANNER PROVIDED BY THE LAW 1,974
UNDER WHICH THE CORPORATION EXISTS. 1,975
(B) AN ASSOCIATION MAY CONVERT ITSELF TO A DOMESTIC 1,977
CORPORATION BY ADOPTING AN AMENDMENT TO ITS ARTICLES OF 1,978
INCORPORATION IN WHICH IT ELECTS TO BECOME SUBJECT TO ANY OTHER 1,979
CHAPTER OF TITLE XVII OF THE REVISED CODE, IF SO PERMITTED BY 1,981
SUCH CHAPTER, TOGETHER WITH ANY CHANGES IN ITS ARTICLES OF
INCORPORATION AND BYLAWS REQUIRED BY SUCH CHAPTER AND ANY OTHER 1,982
DESIRABLE CHANGES PERMITTED BY SUCH CHAPTER. THE AMENDMENT SHALL 1,983
BE ADOPTED, FILED, AND RECORDED UNDER THIS CHAPTER IN THE SAME 1,984
MANNER AS AN AMENDMENT OF THE ARTICLES OF INCORPORATION UNDER 1,985
SECTIONS 1729.08 AND 1729.09 OF THE REVISED CODE.
Sec. 1729.44. AN ACTION TO SET ASIDE A MERGER, 1,987
CONSOLIDATION, DIVISION, OR CONVERSION OF AN ASSOCIATION, ON THE 1,988
GROUND THAT ANY SECTION OF THE REVISED CODE HAS NOT BEEN COMPLIED 1,989
WITH, SHALL BE BROUGHT WITHIN NINETY DAYS AFTER THE EFFECTIVE
48
DATE OF THE MERGER, CONSOLIDATION, DIVISION, OR CONVERSION, OR 1,990
SUCH ACTION SHALL BE FOREVER BARRED. 1,991
Sec. 1729.46. (A) IN ORDER TO OBTAIN PAYMENT OF THE FAIR 1,993
CASH VALUE, A STOCKHOLDER ENTITLED TO PAYMENT OF THE FAIR CASH 1,994
VALUE OF STOCK UNDER SECTION 1729.09, 1729.35, 1729.36, OR 1,995
1729.40 OF THE REVISED CODE SHALL DELIVER A WRITTEN DEMAND FOR 1,996
PAYMENT OF THE FAIR CASH VALUE OF THE STOCK TO THE ASSOCIATION NO 1,997
LATER THAN FIFTEEN DAYS AFTER NOTICE IS SENT TO MEMBERS AND 1,998
STOCKHOLDERS IN ACCORDANCE WITH SECTION 1729.09, 1729.35, 1,999
1729.36, OR 1729.40 OF THE REVISED CODE, AS THE CASE MAY BE. THE 2,000
WRITTEN DEMAND SHALL STATE THE NAME AND ADDRESS OF THE 2,001
STOCKHOLDER, THE NUMBER AND CLASS OF THE STOCK FOR WHICH FAIR 2,003
CASH VALUE IS DEMANDED, AND THE AMOUNT CLAIMED BY THE STOCKHOLDER 2,004
TO BE THE FAIR CASH VALUE OF THE STOCK. DELIVERY OF WRITTEN 2,005
DEMAND FOR PAYMENT OF FAIR CASH VALUE OF STOCK IN ACCORDANCE WITH 2,006
THIS SECTION IS SUFFICIENT IF DELIVERED TO THE ASSOCIATION OR TO 2,007
THE SURVIVING OR NEW ASSOCIATION OR ENTITY RESULTING FROM THE
MERGER, CONSOLIDATION, DIVISION, OR CONVERSION, WHETHER THE 2,008
DEMAND IS DELIVERED BEFORE, ON, OR AFTER THE EFFECTIVE DATE OF 2,010
THE ACTION. IF WRITTEN DEMAND IS NOT TIMELY DELIVERED IN 2,011
CONFORMITY WITH THIS SECTION, THE STOCKHOLDER'S RIGHT TO PAYMENT 2,012
OF FAIR CASH VALUE WITH RESPECT TO THE AMENDMENT TO THE ARTICLES 2,013
OF INCORPORATION, AGREEMENT OF MERGER OR CONSOLIDATION, PLAN OF 2,014
DIVISION, OR CONVERSION SHALL BE BARRED.
(B) IF A TIMELY DEMAND IS DELIVERED IN ACCORDANCE WITH 2,016
THIS SECTION, FAIR CASH VALUE OF THE STOCK SHALL BE DETERMINED 2,017
AND PAID TO THE STOCKHOLDER IN ACCORDANCE WITH THE FOLLOWING 2,018
PROCEDURES:
(1) THE ASSOCIATION OR THE SURVIVING, NEW, OR RESULTING 2,020
ASSOCIATION OR ENTITY SHALL SEND A WRITTEN ACKNOWLEDGMENT OF 2,022
RECEIPT OF THE DEMAND FOR FAIR CASH VALUE TO THE ADDRESS 2,023
SPECIFIED IN THE DEMAND NO LATER THAN FIFTEEN DAYS AFTER RECEIPT
OF THE DEMAND. IF THE BOARD OF THE ASSOCIATION OR THE SURVIVING, 2,024
NEW, OR RESULTING ASSOCIATION OR ENTITY BELIEVES THAT THE DEMAND 2,025
49
HAS FAILED TO COMPLY WITH THE REQUIREMENTS OF THIS SECTION, THE 2,027
ACKNOWLEDGMENT SHALL STATE ANY SUCH DEFECTS. THE ACKNOWLEDGMENT 2,028
ALSO SHALL STATE WHAT THE BOARD BELIEVES TO BE THE FAIR CASH 2,029
VALUE OF THE STOCK THAT IS THE SUBJECT OF THE DEMAND. IF THE 2,030
ARTICLES OF INCORPORATION OF THE CONSTITUENT OR ORIGINAL
ASSOCIATION PROVIDE A VALUE FOR THE STOCK UPON REDEMPTION, THE 2,032
FAIR CASH VALUE OF THE STOCK PRESUMPTIVELY SHALL BE THE LESSER OF 2,034
THE REDEMPTION VALUE OR THE FAIR MARKET VALUE OF SUCH STOCK
IMMEDIATELY PRIOR TO THE MERGER, CONSOLIDATION, DIVISION, OR 2,035
CONVERSION.
(2) THE STOCKHOLDER SHALL NOT TRANSFER, ENCUMBER, PLEDGE, 2,037
OR OTHERWISE DISPOSE OF THE STOCK THAT IS THE SUBJECT OF THE 2,038
DEMAND FOR FAIR CASH VALUE, OR ANY CERTIFICATE REPRESENTING SUCH 2,039
STOCK, UNTIL THE DEMAND IS FINALLY RESOLVED BY AGREEMENT, 2,040
WITHDRAWAL, OR FINAL JUDICIAL DETERMINATION AS PROVIDED IN THIS
SECTION. 2,041
(3) IF THE ASSOCIATION'S ARTICLES OF INCORPORATION OR 2,043
BYLAWS PROVIDE A REASONABLE BASIS FOR DETERMINING AND PAYING THE 2,044
FAIR CASH VALUE OF THE STOCK THAT IS THE SUBJECT OF THE DEMAND 2,045
FOR FAIR CASH VALUE, OR IF THE ASSOCIATION OR THE SURVIVING, NEW, 2,046
OR RESULTING ASSOCIATION OR ENTITY AND THE DEMANDING STOCKHOLDER 2,047
REACH AN AGREEMENT ON THE FAIR CASH VALUE OF THE STOCK WITHIN 2,048
THREE MONTHS AFTER DELIVERY OF THE DEMAND FOR FAIR CASH VALUE, 2,049
THE FAIR CASH VALUE OF THE STOCK SHALL BE DETERMINED IN 2,050
ACCORDANCE WITH THE CONSTITUENT OR ORIGINAL ASSOCIATION'S 2,051
ARTICLES OF INCORPORATION OR BYLAWS, OR AS AGREED UPON, AS THE 2,052
CASE MAY BE. THE ASSOCIATION SHALL THEREUPON TENDER PAYMENT OF 2,053
THE FAIR CASH VALUE SO DETERMINED, TO BE PAID TO THE STOCKHOLDER 2,054
WITHIN THIRTY DAYS OF DELIVERY OF ANY CERTIFICATES REPRESENTING 2,055
THE STOCK OR THE STOCKHOLDER'S WRITTEN WAIVER AND RELEASE OF 2,056
CLAIM TO ALL RIGHTS TO THE STOCK TO THE ASSOCIATION OR THE
SURVIVING, NEW, OR RESULTING ASSOCIATION OR ENTITY. WITHOUT 2,057
PRECLUDING OTHER POSSIBLE REASONABLE BASES FOR DETERMINING FAIR 2,059
CASH VALUE OF STOCK UNDER THIS SECTION, A PROVISION IN THE 2,060
50
CONSTITUENT OR ORIGINAL ASSOCIATION'S ARTICLES OF INCORPORATION
OR BYLAWS THAT FAIR CASH VALUE SHALL BE DETERMINED BY FINAL AND 2,062
BINDING ARBITRATION, OR THAT FAIR CASH VALUE SHALL BE THE LESSER 2,063
OF PAR VALUE, BOOK VALUE, OR FAIR MARKET VALUE, SHALL BE
CONSIDERED A REASONABLE BASIS FOR DETERMINING AND PAYING THE FAIR 2,064
CASH VALUE OF STOCK. 2,066
(C) THE RIGHT OF A DEMANDING STOCKHOLDER TO RECEIVE THE 2,068
FAIR CASH VALUE OF STOCK AS TO WHICH THE STOCKHOLDER SEEKS RELIEF 2,069
AND THE OBLIGATION OF THE ASSOCIATION OR THE SURVIVING, NEW, OR 2,070
RESULTING ASSOCIATION OR ENTITY TO FURNISH THE FAIR CASH VALUE 2,072
FOR THOSE INTERESTS TERMINATE IF ANY OF THE FOLLOWING APPLIES:
(1) THE DEMANDING STOCKHOLDER FAILS TO COMPLY WITH THIS 2,074
SECTION.
(2) THE ASSOCIATION ABANDONS THE AMENDMENT OF ARTICLES, 2,076
MERGER, CONSOLIDATION, DIVISION, OR CONVERSION OR IS FINALLY 2,077
ENJOINED OR PREVENTED FROM TAKING SUCH ACTION. 2,078
(3) THE DEMANDING STOCKHOLDER WITHDRAWS THE DEMAND FOR 2,080
FAIR CASH VALUE WITH CONSENT OF THE ASSOCIATION. 2,081
(4) THE DEMANDING STOCKHOLDER ATTEMPTS TO SELL, TRANSFER, 2,083
OR ENCUMBER THE STOCK WHICH IS THE SUBJECT OF THE DEMAND PRIOR TO 2,084
FINAL DETERMINATION OF ITS FAIR CASH VALUE UNDER THIS SECTION OR 2,085
UNDER SECTION 1729.47 OF THE REVISED CODE.
(5) ALL OF THE FOLLOWING APPLY: 2,087
(a) THE ARTICLES OF INCORPORATION OR BYLAWS OF THE 2,089
ASSOCIATION DO NOT PROVIDE A REASONABLE BASIS FOR DETERMINING AND 2,090
PAYING FAIR CASH VALUE TO AN AFFECTED STOCKHOLDER; 2,091
(b) THE ASSOCIATION AND THE AFFECTED STOCKHOLDER HAVE NOT 2,093
AGREED UPON THE FAIR CASH VALUE OF THE STOCK WHICH IS THE SUBJECT 2,094
OF THE DEMAND;
(c) THE AFFECTED STOCKHOLDER DOES NOT FILE A TIMELY 2,096
COMPLAINT UNDER SECTION 1729.47 OF THE REVISED CODE. 2,097
(D) THE FAIR CASH VALUE THAT IS AGREED UPON BY THE 2,099
AFFECTED STOCKHOLDER AND THE ASSOCIATION, OR DETERMINED USING A 2,100
REASONABLE BASIS FOR DETERMINING AND PAYING FAIR CASH VALUE IN 2,101
51
THE ASSOCIATION'S ARTICLES OF INCORPORATION OR BYLAWS, OR FIXED 2,102
BY A COURT IN A PROCEEDING UNDER SECTION 1729.47 OF THE REVISED 2,103
CODE, SHALL BE PAID WITHIN THIRTY DAYS AS FOLLOWS:
(1) IMMEDIATELY TO THE HOLDER OF UNCERTIFICATED STOCK; 2,105
(2) UPON AND SIMULTANEOUSLY WITH THE SURRENDER OF 2,107
CERTIFICATES REPRESENTING CERTIFICATED STOCK. 2,108
Sec. 1729.47. (A) IF THE ASSOCIATION'S ARTICLES OF 2,110
INCORPORATION OR BYLAWS DO NOT PROVIDE A REASONABLE BASIS FOR 2,112
DETERMINING AND PAYING FAIR CASH VALUE OF THE STOCK THAT IS THE 2,113
SUBJECT OF THE DEMAND FOR PAYMENT OF FAIR CASH VALUE AND THE 2,114
AFFECTED STOCKHOLDER HAS NOT AGREED UPON A FAIR CASH VALUE OF THE 2,115
STOCK THAT IS THE SUBJECT OF THE DEMAND WITHIN THREE MONTHS AFTER 2,116
DELIVERY OF THE DEMAND FOR PAYMENT OF FAIR CASH VALUE, THE 2,117
AFFECTED STOCKHOLDER, WITHIN THIRTY DAYS THEREAFTER, MAY FILE A 2,119
COMPLAINT FOR RECOVERY OF FAIR CASH VALUE OF THE STOCK FROM THE 2,121
ASSOCIATION OR THE SURVIVING, NEW, OR RESULTING ASSOCIATION OR
ENTITY IN THE COURT OF COMMON PLEAS OF THE COUNTY IN WHICH THE 2,123
PRINCIPAL OFFICE OF THE ASSOCIATION THAT ISSUED THE STOCK IS OR 2,124
WAS LOCATED. OTHER AFFECTED STOCKHOLDERS WHO HAVE MADE TIMELY 2,126
DEMAND FOR PAYMENT OF FAIR CASH VALUE MAY JOIN AS PLAINTIFFS IN 2,127
THE PROCEEDING AND ANY TWO OR MORE PROCEEDINGS COMMENCED BY 2,128
AFFECTED STOCKHOLDERS MAY BE CONSOLIDATED. THE COMPLAINT SHALL 2,129
CONTAIN A BRIEF STATEMENT OF THE RELEVANT FACTS, INCLUDING THE
VOTE BY MEMBERS OF THE ASSOCIATION, THE FACTS ENTITLING THE 2,130
STOCKHOLDER TO RELIEF UNDER THIS SECTION, AND A DEMAND FOR THAT 2,131
RELIEF. NOTWITHSTANDING THE RULES OF CIVIL PROCEDURE, NO ANSWER 2,132
TO A COMPLAINT FILED UNDER THIS SECTION IS REQUIRED. 2,133
(B) UPON FILING THE COMPLAINT AND UPON MOTION OF THE 2,135
COMPLAINANT, THE COURT SHALL FIX A DATE FOR HEARING ON THE 2,136
COMPLAINT AND REQUIRE SERVICE OF A NOTICE OF THE COMPLAINT AND 2,137
THE DATE FOR HEARING ON THE DEFENDANT IN THE MANNER PRESCRIBED IN 2,138
THE RULES OF CIVIL PROCEDURE FOR SERVICE OF PROCESS. 2,139
(C) ON THE DATE FIXED FOR THE HEARING OR ANY ADJOURNMENT 2,141
THEREOF, THE COURT SHALL DETERMINE FROM THE COMPLAINT AND ANY 2,142
52
EVIDENCE SUBMITTED AT THE HEARING BY THE PARTIES, WHETHER THE 2,143
AFFECTED STOCKHOLDER IS ENTITLED TO THE FAIR CASH VALUE OF STOCK 2,144
THAT IS THE SUBJECT OF THE DEMAND AND, IF THE STOCKHOLDER IS TO 2,145
BE SO PAID, THE NUMBER AND CLASS OF STOCK FOR WHICH PAYMENT IS TO 2,146
BE MADE.
(D) IF THE COURT FINDS THAT THE AFFECTED STOCKHOLDER IS TO 2,148
BE PAID, IT MAY APPOINT ONE OR MORE PERSONS AS APPRAISERS TO 2,149
RECEIVE EVIDENCE AS TO THE FAIR CASH VALUE. THE APPRAISERS SHALL 2,150
HAVE THE POWER AND AUTHORITY THAT THE COURT SPECIFIES IN THE 2,151
ORDER OF APPOINTMENT, AND THE COURT SHALL FIX REASONABLE 2,152
COMPENSATION FOR THE APPRAISERS. AFTER RECEIVING THE
RECOMMENDATION OF ANY APPOINTED APPRAISER, OR IF APPRAISERS ARE 2,153
NOT APPOINTED, THE COURT SHALL MAKE FINDINGS AS TO THE FAIR CASH 2,154
VALUE AND RENDER JUDGMENT FOR THE PAYMENT OF THAT FAIR CASH VALUE 2,155
AND INTEREST AT THE RATE AND FROM THE DATE THE COURT CONSIDERS 2,156
EQUITABLE. THE COSTS OF THE PROCEEDING, INCLUDING COMPENSATION 2,157
OF THE APPOINTED APPRAISERS AS FIXED BY THE COURT, SHALL BE
ASSESSED AS THE COURT CONSIDERS EQUITABLE. 2,158
(E) THE PROCEEDING ON THE COMPLAINT FOR FAIR CASH VALUE IS 2,160
A SPECIAL PROCEEDING, AND FINAL ORDERS IN IT MAY BE VACATED, 2,161
MODIFIED, OR REVERSED ON APPEAL PURSUANT TO THE RULES OF 2,162
APPELLATE PROCEDURE AND, TO THE EXTENT NOT IN CONFLICT WITH THOSE 2,163
RULES, CHAPTER 2505. OF THE REVISED CODE. 2,164
Sec. 1729.49. (A) AS USED IN THIS SECTION, "SUBSTANTIALLY 2,166
ALL" MEANS MORE THAN TWO-THIRDS OF THE ASSOCIATION'S ASSETS, 2,167
MEASURED, IN THE BOARD'S DISCRETION, EITHER BY VALUE AS RECORDED 2,168
IN THE BOOKS AND RECORDS OF THE ASSOCIATION OR BY FAIR MARKET 2,169
VALUE.
(B) UNLESS THE ARTICLES OF INCORPORATION OR THE BYLAWS OF 2,171
AN ASSOCIATION OTHERWISE PROVIDE, A LEASE, SALE, EXCHANGE, 2,172
TRANSFER, OR OTHER DISPOSITION OF ANY ASSETS OF AN ASSOCIATION 2,173
MAY BE MADE UPON TERMS AND FOR CONSIDERATION, WHICH MAY CONSIST, 2,174
IN WHOLE OR IN PART, OF MONEY OR OTHER PROPERTY, INCLUDING SHARES 2,175
OR OTHER SECURITIES OR PROMISSORY OBLIGATIONS OF ANY ASSOCIATION 2,177
53
OR ENTITY, AS MAY BE AUTHORIZED BY THE BOARD. IF A LEASE, SALE, 2,178
EXCHANGE, TRANSFER, OR OTHER DISPOSITION, OR A SERIES OF SUCH 2,179
TRANSACTIONS, WOULD DISPOSE OF ALL OR SUBSTANTIALLY ALL OF THE 2,180
ASSETS OF THE ASSOCIATION, THEN THE DISPOSITION MAY BE MADE ONLY 2,181
UPON A WRITTEN PLAN OF DISPOSITION PREPARED BY THE BOARD OR BY A 2,182
COMMITTEE SELECTED BY THE BOARD FOR THAT PURPOSE, AND ADOPTED IN 2,183
THE SAME MANNER AS PROVIDED FOR THE ADOPTION OF A RESOLUTION OF
DISSOLUTION IN SECTION 1729.55 OF THE REVISED CODE. A PLAN OF 2,185
DISPOSITION SHALL SET FORTH A GENERAL DESCRIPTION OR SUMMARY OF 2,186
THE ASSETS SUBJECT TO DISPOSITION, THE METHOD OF DISPOSITION, THE 2,187
INTENDED TRANSFEREE OF THE ASSETS, IF KNOWN TO THE BOARD OF 2,188
DIRECTORS, AND A GENERAL DESCRIPTION OF ANY MATERIAL EFFECT THE
BOARD BELIEVES THE DISPOSITION WILL HAVE ON THE INTERESTS OF THE 2,189
MEMBERS AND STOCKHOLDERS. NOTICE OF A MEETING OF THE MEMBERS AT 2,190
WHICH A PLAN OF DISPOSITION WILL BE VOTED ON SHALL BE GIVEN TO 2,191
ALL MEMBERS, WHETHER OR NOT ENTITLED TO VOTE AT THE MEETING. 2,192
SUCH NOTICE SHALL BE ACCOMPANIED BY A COPY OR SUMMARY OF THE PLAN 2,193
OF DISPOSITION AND A BALLOT FOR THOSE MEMBERS ENTITLED TO VOTE ON 2,194
THE PLAN.
(C) THE ASSOCIATION, BY ITS BOARD, MAY ABANDON A PLAN OF 2,197
DISPOSITION, SUBJECT TO THE CONTRACT RIGHTS OF OTHER PERSONS, IF
THE POWER OF ABANDONMENT IS CONFERRED UPON THE BOARD EITHER BY 2,198
THE TERMS OF THE TRANSACTION OR IN THE PLAN OF DISPOSITION. 2,199
(D) AN ACTION TO SET ASIDE A DISPOSITION OF ASSETS BY AN 2,201
ASSOCIATION, ON THE GROUND THAT ANY SECTION OF THE REVISED CODE 2,203
APPLICABLE TO THE LEASE, SALE, EXCHANGE, TRANSFER, OR OTHER 2,204
DISPOSITION OF ALL OR SUBSTANTIALLY ALL THE ASSETS OF SUCH
ASSOCIATION HAS NOT BEEN COMPLIED WITH, SHALL BE BROUGHT WITHIN 2,205
NINETY DAYS AFTER SUCH TRANSACTION, OR SUCH ACTION SHALL BE 2,206
FOREVER BARRED.
Sec. 1729.55. (A) AN ASSOCIATION MAY BE DISSOLVED 2,208
VOLUNTARILY IN THE MANNER PROVIDED IN THIS SECTION. 2,209
(B) A RESOLUTION OF DISSOLUTION FOR AN ASSOCIATION SHALL 2,211
STATE BOTH OF THE FOLLOWING: 2,212
54
(1) THAT THE ASSOCIATION ELECTS TO BE DISSOLVED; 2,214
(2) ANY ADDITIONAL PROVISION CONSIDERED NECESSARY WITH 2,216
RESPECT TO THE PROPOSED DISSOLUTION AND WINDING UP. 2,217
(C) BEFORE SUBSCRIPTIONS FOR MEMBERSHIP AND ANY STOCK OR 2,219
OTHER OWNERSHIP INTEREST HAVE BEEN RECEIVED, THE INCORPORATORS OR 2,220
A MAJORITY OF THE INCORPORATORS MAY ADOPT, BY A WRITING SIGNED BY 2,221
THEM, A RESOLUTION OF DISSOLUTION. 2,222
(D) THE DIRECTORS MAY ADOPT A RESOLUTION OF DISSOLUTION IN 2,224
THE FOLLOWING CASES: 2,225
(1) WHEN THE ASSOCIATION HAS BEEN ADJUDGED BANKRUPT OR HAS 2,227
MADE A GENERAL ASSIGNMENT FOR THE BENEFIT OF CREDITORS; 2,228
(2) BY LEAVE OF THE COURT, WHEN A RECEIVER HAS BEEN 2,230
APPOINTED IN A GENERAL CREDITORS' SUIT OR IN ANY SUIT IN WHICH 2,231
THE AFFAIRS OF THE ASSOCIATION ARE TO BE WOUND UP; 2,232
(3) WHEN SUBSTANTIALLY ALL OF THE ASSETS HAVE BEEN SOLD AT 2,234
JUDICIAL SALE OR OTHERWISE; 2,235
(4) WHEN THE ARTICLES OF INCORPORATION HAVE BEEN CANCELED 2,237
FOR FAILURE TO FILE ANNUAL FRANCHISE OR EXCISE TAX RETURNS OR FOR 2,238
FAILURE TO PAY FRANCHISE OR EXCISE TAXES AND THE ASSOCIATION HAS 2,239
NOT BEEN REINSTATED OR DOES NOT DESIRE TO BE REINSTATED; 2,240
(5) WHEN THE PERIOD OF EXISTENCE OF THE ASSOCIATION 2,242
SPECIFIED IN ITS ARTICLES HAS EXPIRED. 2,243
(E) AT A MEETING HELD FOR SUCH PURPOSE, THE MEMBERS MAY 2,245
ADOPT A RESOLUTION OF DISSOLUTION BY THE AFFIRMATIVE VOTE OF 2,246
SIXTY PER CENT OF THE MEMBER VOTES CAST ON SUCH PROPOSAL OR, IF 2,247
THE ARTICLES PROVIDE OR PERMIT, BY THE AFFIRMATIVE VOTE OF A 2,248
GREATER OR LESSER PROPORTION, THOUGH NOT LESS THAN A MAJORITY, OF 2,249
SUCH VOTING POWER, OF ANY PARTICULAR CLASS AS IS REQUIRED BY THE
ARTICLES OF INCORPORATION. NOTICE OF THE MEETING OF THE MEMBERS 2,250
SHALL BE GIVEN TO ALL MEMBERS AND STOCKHOLDERS WHETHER OR NOT 2,251
ENTITLED TO VOTE.
(F) UPON THE ADOPTION OF A RESOLUTION OF DISSOLUTION, A 2,253
CERTIFICATE SHALL BE FILED WITH THE SECRETARY OF STATE, ON A FORM 2,254
PRESCRIBED BY THE SECRETARY OF STATE, STATING ALL OF THE 2,256
55
FOLLOWING:
(1) THE NAME OF THE ASSOCIATION; 2,258
(2) A STATEMENT THAT A RESOLUTION OF DISSOLUTION HAS BEEN 2,260
ADOPTED, ITS MANNER OF ADOPTION, AND, IN THE CASE OF ITS ADOPTION 2,261
BY THE INCORPORATORS OR DIRECTORS, A STATEMENT OF THE BASIS FOR 2,262
SUCH ADOPTION;
(3) THE PLACE IN THIS STATE WHERE THE ASSOCIATION'S 2,264
PRINCIPAL OFFICE IS LOCATED; 2,265
(4) THE NAMES AND ADDRESSES OF THE ASSOCIATION'S DIRECTORS 2,267
AND OFFICERS, OR IF THE RESOLUTION OF DISSOLUTION IS ADOPTED BY 2,268
THE INCORPORATORS, THE NAMES AND ADDRESSES OF THE INCORPORATORS; 2,269
(5) THE NAME AND ADDRESS OF THE ASSOCIATION'S STATUTORY 2,271
AGENT.
(G) SUCH CERTIFICATE SHALL BE SIGNED AS FOLLOWS: 2,273
(1) WHEN THE RESOLUTION OF DISSOLUTION IS ADOPTED BY THE 2,275
INCORPORATORS, THE CERTIFICATE SHALL BE SIGNED BY NOT LESS THAN A 2,277
MAJORITY OF THE INCORPORATORS;
(2) WHEN THE RESOLUTION IS ADOPTED BY THE DIRECTORS OR BY 2,279
THE MEMBERS, THE CERTIFICATE SHALL BE SIGNED BY ANY AUTHORIZED 2,280
OFFICER. HOWEVER, IF NO AUTHORIZED OFFICER EXECUTES AND FILES 2,282
SUCH CERTIFICATE WITHIN THIRTY DAYS AFTER THE ADOPTION OF THE 2,283
RESOLUTION OR UPON ANY DATE SPECIFIED IN THE RESOLUTION AS THE 2,284
DATE UPON WHICH SUCH CERTIFICATE IS TO BE FILED OR UPON THE 2,285
EXPIRATION OF ANY PERIOD SPECIFIED IN THE RESOLUTION AS THE 2,286
PERIOD WITHIN WHICH SUCH CERTIFICATE IS TO BE FILED, WHICHEVER IS 2,287
LATEST, THE CERTIFICATE OF DISSOLUTION MAY BE SIGNED BY ANY THREE
MEMBERS, OR IF THERE ARE LESS THAN THREE MEMBERS, THEN BY ALL OF 2,288
THE MEMBERS, AND SHALL SET FORTH A STATEMENT THAT THE PERSONS 2,289
SIGNING THE CERTIFICATE ARE MEMBERS AND ARE FILING THE 2,290
CERTIFICATE BECAUSE OF THE FAILURE OF AN AUTHORIZED OFFICER TO DO 2,292
SO.
(H) A CERTIFICATE OF DISSOLUTION, FILED WITH THE SECRETARY 2,294
OF STATE, SHALL BE ACCOMPANIED BY ALL OF THE FOLLOWING: 2,295
(1) AN AFFIDAVIT OF ONE OR MORE OF THE PERSONS EXECUTING 2,297
56
THE CERTIFICATE OF DISSOLUTION OR OF ANY AUTHORIZED OFFICER OF 2,298
THE ASSOCIATION CONTAINING A STATEMENT OF THE COUNTIES, IF ANY, 2,300
IN THIS STATE IN WHICH THE ASSOCIATION HAS PERSONAL PROPERTY OR A 2,301
STATEMENT THAT THE ASSOCIATION IS OF A TYPE REQUIRED TO PAY
PERSONAL PROPERTY TAXES TO STATE AUTHORITIES ONLY; 2,302
(2) A RECEIPT, CERTIFICATE, OR OTHER EVIDENCE SHOWING THE 2,304
PAYMENT OF ALL FRANCHISE, SALES, USE, AND HIGHWAY USE TAXES 2,305
ACCRUING UP TO THE DATE OF SUCH FILING, OR THAT SUCH PAYMENT HAS 2,306
BEEN ADEQUATELY GUARANTEED;
(3) A RECEIPT, CERTIFICATE, OR OTHER EVIDENCE SHOWING THE 2,308
PAYMENT OF ALL PERSONAL PROPERTY TAXES ACCRUING UP TO THE DATE OF 2,309
SUCH FILING;
(4) A RECEIPT, CERTIFICATE, OR OTHER EVIDENCE FROM THE 2,311
BUREAU OF EMPLOYMENT SERVICES SHOWING THAT ALL CONTRIBUTIONS DUE 2,312
FROM THE ASSOCIATION AS AN EMPLOYER HAVE BEEN PAID, OR THAT SUCH 2,313
PAYMENT HAS BEEN ADEQUATELY GUARANTEED, OR THAT THE ASSOCIATION 2,314
IS NOT SUBJECT TO SUCH CONTRIBUTIONS;
(5) A RECEIPT, CERTIFICATE, OR OTHER EVIDENCE FROM THE 2,316
BUREAU OF WORKERS' COMPENSATION SHOWING THAT ALL PREMIUMS DUE 2,317
FROM THE ASSOCIATION AS AN EMPLOYER HAVE BEEN PAID, OR THAT SUCH 2,318
PAYMENT HAS BEEN ADEQUATELY GUARANTEED, OR THAT THE ASSOCIATION 2,319
IS NOT SUBJECT TO SUCH PREMIUM PAYMENTS;
(6) IN LIEU OF THE RECEIPT, CERTIFICATE, OR OTHER EVIDENCE 2,321
DESCRIBED IN DIVISION (H)(2), (3), (4), OR (5) OF THIS SECTION, 2,322
AN AFFIDAVIT OF ONE OR MORE PERSONS EXECUTING THE CERTIFICATE OF 2,323
DISSOLUTION OR OF ANY AUTHORIZED OFFICER OF THE ASSOCIATION 2,325
CONTAINING A STATEMENT OF THE DATE UPON WHICH THE PARTICULAR 2,326
DEPARTMENT, AGENCY, OR AUTHORITY WAS ADVISED IN WRITING OF THE 2,327
SCHEDULED DATE OF FILING OF THE CERTIFICATE OF DISSOLUTION AND 2,328
WAS ADVISED IN WRITING OF THE ACKNOWLEDGMENT BY THE ASSOCIATION 2,329
OF THE APPLICABILITY OF SECTION 1729.25 OF THE REVISED CODE. 2,330
(I) UPON THE FILING OF A CERTIFICATE OF DISSOLUTION AND 2,332
THE ACCOMPANYING DOCUMENTS REQUIRED BY DIVISION (H) OF THIS 2,333
SECTION, THE ASSOCIATION SHALL BE DISSOLVED. 2,334
57
Sec. 1729.56. FOLLOWING THE FILING OF THE CERTIFICATE OF 2,336
DISSOLUTION, THE DIRECTORS OR THE INCORPORATORS WHO FILED THE 2,337
CERTIFICATE, AS THE CASE MAY BE, SHALL CAUSE A NOTICE OF 2,338
VOLUNTARY DISSOLUTION TO BE PUBLISHED ONCE A WEEK ON THE SAME DAY 2,339
OF EACH WEEK FOR TWO SUCCESSIVE WEEKS, IN A NEWSPAPER PUBLISHED
AND OF GENERAL CIRCULATION IN THE COUNTY IN WHICH THE PRINCIPAL 2,340
OFFICE OF THE ASSOCIATION WAS TO BE OR IS LOCATED, AND SHALL 2,341
CAUSE WRITTEN NOTICE OF DISSOLUTION TO BE GIVEN TO ALL KNOWN 2,342
CREDITORS OF, AND TO ALL KNOWN CLAIMANTS AGAINST, THE DISSOLVED 2,343
ASSOCIATION.
Sec. 1729.58. (A) WHEN AN ASSOCIATION IS DISSOLVED 2,345
VOLUNTARILY, WHEN THE ARTICLES OF INCORPORATION OF AN ASSOCIATION 2,346
HAVE BEEN CANCELED, WHEN A FINAL ORDER OF A COURT OF COMMON PLEAS 2,347
IS MADE DISSOLVING AN ASSOCIATION UNDER SECTION 1729.59 OF THE 2,348
REVISED CODE, OR WHEN THE PERIOD OF EXISTENCE OF THE ASSOCIATION
SPECIFIED IN ITS ARTICLES OF INCORPORATION HAS EXPIRED, THE 2,349
ASSOCIATION SHALL CEASE TO CARRY ON BUSINESS AND SHALL DO ONLY 2,350
SUCH ACTS AS ARE REQUIRED TO WIND UP ITS AFFAIRS, OR TO OBTAIN 2,351
REINSTATEMENT OF THE ARTICLES IN ACCORDANCE WITH SECTION 1729.11 2,352
OF THE REVISED CODE.
(B) ANY CLAIM EXISTING OR ACTION OR PROCEEDING PENDING BY 2,354
OR AGAINST THE ASSOCIATION OR WHICH WOULD HAVE ACCRUED AGAINST IT 2,355
MAY BE PROSECUTED TO JUDGMENT, WITH RIGHT OF APPEAL AS IN OTHER 2,356
CASES, BUT ANY PROCEEDING, EXECUTION, OR PROCESS, OR THE 2,357
SATISFACTION OR PERFORMANCE OF ANY ORDER, JUDGMENT, OR DECREE, 2,358
MAY BE STAYED AS PROVIDED IN SECTION 1729.59 OF THE REVISED CODE.
(C) ANY PROCESS, NOTICE, OR DEMAND AGAINST THE ASSOCIATION 2,360
MAY BE SERVED BY DELIVERING A COPY TO AN OFFICER, DIRECTOR, 2,361
LIQUIDATOR, OR PERSON HAVING CHARGE OF ITS ASSETS OR, IF NO SUCH 2,362
PERSON CAN BE FOUND, TO THE STATUTORY AGENT. 2,363
(D) THE DIRECTORS OF THE ASSOCIATION OR THEIR SUCCESSORS 2,366
SHALL ACT AS A BOARD OF DIRECTORS IN ACCORDANCE WITH THE ARTICLES
OF INCORPORATION AND BYLAWS UNTIL THE AFFAIRS OF THE ASSOCIATION 2,367
ARE COMPLETELY WOUND UP. SUBJECT TO THE ORDERS OF COURTS OF THIS 2,368
58
STATE HAVING JURISDICTION OVER THE ASSOCIATION, THE DIRECTORS 2,369
SHALL PROCEED AS SPEEDILY AS IS PRACTICABLE TO A COMPLETE WINDING 2,370
UP OF THE AFFAIRS OF THE ASSOCIATION AND, TO THE EXTENT NECESSARY 2,371
OR EXPEDIENT TO THAT END, SHALL EXERCISE ALL THE AUTHORITY OF THE 2,372
ASSOCIATION. WITHOUT LIMITING THE GENERALITY OF SUCH AUTHORITY, 2,373
THE DIRECTORS MAY FILL VACANCIES, ELECT OFFICERS, CARRY OUT
CONTRACTS OF THE ASSOCIATION, MAKE NEW CONTRACTS, BORROW MONEY, 2,374
MORTGAGE OR PLEDGE THE PROPERTY OF THE ASSOCIATION AS SECURITY, 2,375
SELL ITS ASSETS AT PUBLIC OR PRIVATE SALE, MAKE CONVEYANCES IN 2,376
THE ASSOCIATION'S NAME, LEASE REAL ESTATE FOR ANY TERM, INCLUDING 2,377
NINETY-NINE YEARS RENEWABLE FOREVER, SETTLE OR COMPROMISE CLAIMS 2,378
IN FAVOR OF OR AGAINST THE ASSOCIATION, EMPLOY ONE OR MORE
PERSONS AS LIQUIDATORS TO WIND UP THE AFFAIRS OF THE ASSOCIATION 2,379
WITH SUCH AUTHORITY AS THE DIRECTORS SEE FIT TO GRANT, CAUSE THE 2,380
TITLE TO ANY OF THE ASSETS OF THE ASSOCIATION TO BE CONVEYED TO 2,381
SUCH LIQUIDATORS FOR THAT PURPOSE, APPLY ASSETS TO THE PAYMENT OF 2,382
OBLIGATIONS, AND, AFTER PAYING OR ADEQUATELY PROVIDING FOR THE 2,383
PAYMENT OF ALL KNOWN OBLIGATIONS OF THE ASSOCIATION, DISTRIBUTE 2,384
THE REMAINDER OF THE ASSETS EITHER IN CASH OR IN KIND AMONG THE
MEMBERS, PATRONS, AND STOCKHOLDERS ACCORDING TO THEIR RESPECTIVE 2,385
RIGHTS AND INTERESTS. IN ADDITION, THE DIRECTORS MAY PERFORM ALL 2,386
OTHER ACTS NECESSARY OR EXPEDIENT TO THE WINDING UP OF THE 2,387
AFFAIRS OF THE ASSOCIATION.
(E) WITHOUT LIMITING THE AUTHORITY OF THE DIRECTORS, ANY 2,389
ACTION WITHIN THE PURVIEW OF THIS SECTION THAT IS AUTHORIZED OR 2,390
APPROVED AT A MEETING OF THE MEMBERS BY SIXTY PER CENT OF THE 2,391
MEMBER VOTES CAST THEREON SHALL BE CONCLUSIVE FOR ALL PURPOSES 2,392
UPON ALL MEMBERS, PATRONS, AND STOCKHOLDERS OF THE ASSOCIATION. 2,393
(F) ALL DEEDS AND OTHER INSTRUMENTS OF THE ASSOCIATION 2,395
SHALL BE IN THE NAME OF THE ASSOCIATION AND SHALL BE EXECUTED, 2,396
ACKNOWLEDGED, AND DELIVERED BY THE OFFICERS APPOINTED BY THE 2,397
DIRECTORS.
(G) AT ANY TIME DURING THE WINDING UP OF ITS AFFAIRS, THE 2,399
ASSOCIATION BY ITS DIRECTORS MAY MAKE APPLICATION TO THE COURT OF 2,400
59
COMMON PLEAS OF THE COUNTY IN THIS STATE IN WHICH THE PRINCIPAL 2,401
OFFICE OF THE ASSOCIATION IS LOCATED TO HAVE THE WINDING UP 2,402
CONTINUED UNDER SUPERVISION OF THE COURT, AS PROVIDED IN SECTION 2,403
1729.59 OF THE REVISED CODE.
Sec. 1729.59. (A) WITHOUT LIMITING THE GENERALITY OF ITS 2,405
AUTHORITY, THE COURT OF COMMON PLEAS OF THE COUNTY IN THIS STATE 2,406
IN WHICH IS LOCATED THE PRINCIPAL OFFICE OF A VOLUNTARILY 2,407
DISSOLVED ASSOCIATION OR OF AN ASSOCIATION WHOSE ARTICLES HAVE 2,408
BEEN CANCELED OR WHOSE PERIOD OF EXISTENCE HAS EXPIRED, UPON THE 2,409
COMPLAINT OF THE ASSOCIATION, OR A MAJORITY OF THE DIRECTORS, OR 2,410
TEN PER CENT OF THE MEMBERS OR TWENTY MEMBERS, WHICHEVER IS LESS, 2,411
AND UPON SUCH NOTICE TO ALL THE DIRECTORS AND SUCH OTHER PERSONS
INTERESTED AS THE COURT CONSIDERS PROPER, AT ANY TIME MAY ORDER 2,412
AND ADJUDGE ANY OF THE FOLLOWING MATTERS: 2,413
(1) THE PRESENTATION AND PROOF OF ALL CLAIMS AND DEMANDS 2,415
AGAINST THE ASSOCIATION AND OF ALL RIGHTS, INTERESTS, OR LIENS IN 2,416
OR ON ANY OF ITS PROPERTY; THE FIXING OF THE TIME AND THE MANNER 2,417
IN WHICH SUCH PROOF SHALL BE MADE AND THE PERSON TO WHOM SUCH 2,418
PRESENTATION SHALL BE MADE; AND THE BARRING FROM PARTICIPATION IN 2,419
ANY DISTRIBUTION OF ASSETS OF ALL PERSONS FAILING TO MAKE AND 2,421
PRESENT PROOFS AS REQUIRED BY THE ORDER OF THE COURT;
(2) THE STAY OF THE PROSECUTION OF ANY PROCEEDING AGAINST 2,423
THE ASSOCIATION OR INVOLVING ANY OF ITS PROPERTY, AND THE 2,424
REQUIREMENT THAT THE PARTIES TO THE PROCEEDING PRESENT AND PROVE 2,425
THEIR CLAIMS, DEMANDS, RIGHTS, INTERESTS, OR LIENS AT THE TIME 2,426
AND IN THE MANNER REQUIRED OF CREDITORS OR OTHERS; OR THE GRANT 2,427
OF LEAVE TO BRING OR MAINTAIN AN INDEPENDENT PROCEEDING TO
ENFORCE LIENS; 2,428
(3) THE SETTLEMENT OR DETERMINATION OF ALL CLAIMS OF EVERY 2,430
NATURE AGAINST THE ASSOCIATION OR ANY OF ITS PROPERTY; THE 2,431
DETERMINATION OF THE ASSETS REQUIRED TO BE RETAINED TO PAY OR 2,432
PROVIDE FOR THE PAYMENT OF SUCH CLAIMS OR ANY CLAIM; THE 2,433
DETERMINATION OF THE ASSETS AVAILABLE FOR DISTRIBUTION AMONG AND 2,434
RIGHTS OF MEMBERS, PATRONS, AND STOCKHOLDERS; AND THE MAKING OF
60
NEW PARTIES TO THE PROCEEDING SO FAR AS THE COURT CONSIDERS 2,435
PROPER FOR THE DETERMINATION OF ALL MATTERS; 2,436
(4) THE PRESENTATION AND FILING OF INTERMEDIATE AND FINAL 2,438
ACCOUNTS OF THE DIRECTORS OR OF THE LIQUIDATORS AND HEARINGS ON 2,439
THEM; THE ALLOWANCE, DISALLOWANCE, OR SETTLEMENT OF THE ACCOUNTS; 2,440
AND THE DISCHARGE OF THE DIRECTORS, THE LIQUIDATORS, OR ANY OF 2,441
THEM FROM THEIR DUTIES AND LIABILITIES;
(5) THE APPOINTMENT OF A SPECIAL MASTER COMMISSIONER TO 2,443
HEAR AND DETERMINE ANY SUCH MATTERS WITH SUCH AUTHORITY AS THE 2,444
COURT CONSIDERS PROPER;
(6) THE FILLING OF ANY VACANCIES IN THE NUMBER OF 2,446
DIRECTORS OR LIQUIDATORS WHEN THE DIRECTORS ARE UNABLE TO ACT ON 2,447
THE VACANCIES FOR WANT OF A QUORUM OR FOR ANY OTHER REASON; 2,448
(7) THE APPOINTMENT OF A RECEIVER, IN ACCORDANCE WITH THE 2,450
USAGE OF A COURT IN EQUITABLE MATTERS, TO WIND UP THE AFFAIRS OF 2,451
THE ASSOCIATION, TO TAKE CUSTODY OF ANY OF ITS PROPERTY, OR FOR 2,452
ANY OTHER PURPOSE;
(8) THE ISSUANCE OR ENTRY OF ANY INJUNCTION OR ANY OTHER 2,454
ORDER THAT THE COURT CONSIDERS PROPER IN THE ADMINISTRATION OF 2,455
THE TRUST INVOLVED IN THE WINDING UP OF THE AFFAIRS OF THE 2,456
ASSOCIATION AND THE GIVING OF NOTICE OF THE ENTRY OF INJUNCTION 2,457
OR ORDER;
(9) THE ALLOWANCE AND PAYMENT OF COMPENSATION TO THE 2,459
DIRECTORS OR ANY OF THEM, TO LIQUIDATORS, TO A RECEIVER, TO THE 2,460
ATTORNEY FOR THE COMPLAINANT, OR TO ANY PERSON PROPERLY RENDERING 2,461
SERVICES BENEFICIAL TO THE ASSOCIATION OR TO THOSE INTERESTED IN 2,462
IT;
(10) THE ENTRY OF A JUDGMENT OR DECREE THAT, IF IT SO 2,464
PROVIDES, MAY OPERATE AS THE DEED OR OTHER INSTRUMENT ORDERED TO 2,465
BE EXECUTED, OR THE APPOINTMENT OF A MASTER TO EXECUTE SUCH DEED 2,466
OR INSTRUMENT IN THE NAME OF THE ASSOCIATION WITH THE SAME EFFECT 2,467
AS IF EXECUTED BY AN AUTHORIZED OFFICER PURSUANT TO AUTHORITY 2,468
CONFERRED BY THE DIRECTORS OR THE MEMBERS, PATRONS, AND
STOCKHOLDERS OF THE ASSOCIATION, WHENEVER THERE IS NO OFFICER OR 2,469
61
AGENT COMPETENT TO EXECUTE SUCH DEED OR INSTRUMENT, WHENEVER THE 2,470
ASSOCIATION OR ITS OFFICERS DO NOT PERFORM OR COMPLY WITH A 2,471
JUDGMENT OR DECREE OF COURT, OR WHENEVER THE COURT CONSIDERS IT 2,472
PROPER.
(B) A JUDICIAL PROCEEDING UNDER THIS SECTION CONCERNING 2,474
THE WINDING UP OF THE AFFAIRS OF AN ASSOCIATION IS A SPECIAL 2,475
PROCEEDING, AND FINAL ORDERS IN THE PROCEEDING MAY BE VACATED, 2,476
MODIFIED, OR REVERSED ON APPEAL PURSUANT TO THE RULES OF 2,477
APPELLATE PROCEDURE AND, TO THE EXTENT NOT IN CONFLICT WITH THOSE 2,478
RULES, CHAPTER 2505. OF THE REVISED CODE.
Sec. 1729.60. (A) WHENEVER, AFTER AN ASSOCIATION IS 2,480
DISSOLVED VOLUNTARILY, THE ARTICLES OF AN ASSOCIATION HAVE BEEN 2,481
CANCELED, OR THE PERIOD OF EXISTENCE OF AN ASSOCIATION HAS 2,482
EXPIRED, A RECEIVER IS APPOINTED TO WIND UP THE AFFAIRS OF THE 2,483
ASSOCIATION, ALL THE CLAIMS, DEMANDS, RIGHTS, INTERESTS, OR LIENS 2,484
OF CREDITORS, CLAIMANTS, MEMBERS, PATRONS, AND STOCKHOLDERS SHALL
BE DETERMINED AS OF THE DAY ON WHICH THE RECEIVER WAS APPOINTED. 2,485
UNLESS IT IS OTHERWISE ORDERED, SUCH APPOINTMENT VESTS IN THE 2,486
RECEIVER AND SUCCESSORS OF THE RECEIVER THE RIGHT TO THE 2,487
IMMEDIATE POSSESSION OF ALL THE PROPERTY OF THE ASSOCIATION, 2,488
WHICH SHALL, IF SO ORDERED, EXECUTE AND DELIVER CONVEYANCES OF
SUCH PROPERTY TO THE RECEIVER. 2,489
(B) ANY OFFICER, DIRECTOR, MEMBER, OR OTHER PERSON, 2,491
WHETHER A RESIDENT OF THE STATE OR A NONRESIDENT AND HOWEVER 2,492
INTERESTED, MAY BE APPOINTED AS RECEIVER. 2,493
(C) THE RECEIVER SHALL HAVE ALL THE AUTHORITY VESTED IN 2,495
THE DIRECTORS AND OFFICERS OF THE ASSOCIATION, SHALL EXERCISE 2,496
SUCH AUTHORITY SUBJECT TO SUCH ORDERS AS ARE MADE BY THE COURT, 2,497
AND MAY BE REQUIRED TO QUALIFY BY GIVING BOND TO THE STATE IN 2,498
SUCH AMOUNT AS THE COURT FIXES, WITH SURETY TO THE SATISFACTION 2,499
OF THE CLERK OF THE COURT, CONDITIONED FOR THE FAITHFUL DISCHARGE 2,500
OF DUTIES AND FOR A DUE ACCOUNTING FOR ALL MONEY OR PROPERTY 2,501
RECEIVED.
Sec. 1729.61. (A) AN ASSOCIATION MAY BE DISSOLVED 2,503
62
JUDICIALLY AND ITS AFFAIRS WOUND UP BY AN ORDER OF THE COURT OF 2,504
COMMON PLEAS OF THE COUNTY IN THIS STATE IN WHICH THE ASSOCIATION 2,505
HAS ITS PRINCIPAL OFFICE, IN AN ACTION BROUGHT BY THE MEMBERS 2,506
HAVING SIXTY PER CENT OF THE VOTING POWER OF THE ASSOCIATION ON 2,507
SUCH PROPOSAL, OR THE HOLDERS OF SUCH LESSER PROPORTION AS ARE
ENTITLED BY THE ARTICLES OF INCORPORATION TO DISSOLVE THE 2,508
ASSOCIATION VOLUNTARILY, WHEN IT IS ESTABLISHED THAT IT IS 2,509
BENEFICIAL TO THE MEMBERS, PATRONS, AND STOCKHOLDERS THAT THE 2,510
ASSOCIATION BE JUDICIALLY DISSOLVED.
(B) A COMPLAINT FOR JUDICIAL DISSOLUTION SHALL BE VERIFIED 2,512
BY ANY OF THE COMPLAINANTS AND SHALL SET FORTH FACTS SHOWING THAT 2,513
THE CASE IS AS SPECIFIED IN THIS SECTION. UNLESS THE 2,514
COMPLAINANTS SET FORTH IN THE COMPLAINT THAT THEY ARE UNABLE TO 2,515
ANNEX A LIST OF MEMBERS, PATRONS, OR STOCKHOLDERS, A SCHEDULE 2,516
SHALL BE ANNEXED TO THE COMPLAINT SETTING FORTH THE NAME AND
ADDRESS OF EACH MEMBER, PATRON, AND STOCKHOLDER, IF IT IS KNOWN, 2,517
OR THE FACT THAT IT IS NOT KNOWN. 2,519
(C) UPON THE FILING OF A COMPLAINT FOR JUDICIAL 2,521
DISSOLUTION, THE COURT WITH WHICH IT IS FILED SHALL HAVE POWER TO 2,522
ISSUE INJUNCTIONS, TO APPOINT A RECEIVER WITH SUCH AUTHORITY AND 2,523
DUTIES AS THE COURT FROM TIME TO TIME MAY DIRECT, TO TAKE SUCH 2,524
OTHER PROCEEDINGS AS MAY BE NECESSARY TO PROTECT THE PROPERTY OR 2,525
THE RIGHTS OF THE MEMBERS, PATRONS, AND STOCKHOLDERS, AND TO
CARRY ON THE BUSINESS OF THE ASSOCIATION UNTIL A FULL HEARING CAN 2,526
BE CONDUCTED. UPON OR AFTER THE FILING OF A COMPLAINT FOR 2,527
JUDICIAL DISSOLUTION, THE COURT, BY INJUNCTION OR ORDER, MAY STAY 2,528
THE PROSECUTION OF ANY PROCEEDING AGAINST THE ASSOCIATION OR 2,529
INVOLVING ANY OF ITS PROPERTY AND REQUIRE THE PARTIES TO THE
PROCEEDING TO PRESENT AND PROVE THEIR CLAIMS, DEMANDS, RIGHTS, 2,530
INTERESTS, OR LIENS, AT THE TIME AND IN THE MANNER REQUIRED OF 2,531
CREDITORS OR OTHERS. THE COURT MAY REFER THE COMPLAINT TO A 2,532
SPECIAL MASTER COMMISSIONER.
(D) AFTER A HEARING UPON SUCH NOTICE AS THE COURT MAY 2,534
DIRECT TO BE GIVEN TO ALL PARTIES TO THE PROCEEDING AND TO ANY 2,535
63
OTHER PARTIES IN INTEREST DESIGNATED BY THE COURT, A FINAL ORDER 2,536
BASED EITHER UPON THE EVIDENCE, OR UPON THE REPORT OF THE SPECIAL 2,537
MASTER COMMISSIONER IF ONE HAS BEEN APPOINTED, SHALL BE MADE 2,538
DISSOLVING THE ASSOCIATION OR DISMISSING THE COMPLAINT. AN
ORDER OR JUDGMENT FOR THE JUDICIAL DISSOLUTION OF AN ASSOCIATION 2,539
SHALL CONTAIN A CONCISE STATEMENT OF THE PROCEEDINGS LEADING UP 2,540
TO THE ORDER OR JUDGMENT, THE NAME OF THE ASSOCIATION, THE PLACE 2,541
IN THIS STATE WHERE ITS PRINCIPAL OFFICE IS LOCATED, THE NAMES 2,542
AND ADDRESSES OF ITS DIRECTORS AND OFFICERS, THE NAME AND ADDRESS 2,543
OF A STATUTORY AGENT, AND, IF DESIRED, SUCH OTHER PROVISIONS WITH
RESPECT TO THE JUDICIAL DISSOLUTION AND WINDING UP AS ARE 2,544
CONSIDERED NECESSARY OR DESIRABLE. A CERTIFIED COPY OF SUCH 2,545
ORDER SHALL BE FILED IN THE OFFICE OF THE SECRETARY OF STATE, 2,546
WHEREUPON THE ASSOCIATION SHALL BE DISSOLVED. TO THE EXTENT 2,547
CONSISTENT WITH ORDERS ENTERED IN SUCH PROCEEDING, THE EFFECT OF
SUCH JUDICIAL DISSOLUTION SHALL BE THE SAME AS IN THE CASE OF 2,548
VOLUNTARY DISSOLUTION, AND THE PROVISIONS OF SECTIONS 1729.58, 2,549
1729.59, AND 1729.60 OF THE REVISED CODE RELATING TO THE 2,550
AUTHORITY AND DUTIES OF DIRECTORS DURING THE WINDING UP OF THE
AFFAIRS OF AN ASSOCIATION DISSOLVED VOLUNTARILY, WITH RESPECT TO 2,551
THE JURISDICTION OF COURTS OVER THE WINDING UP OF THE AFFAIRS OF 2,552
AN ASSOCIATION, AND WITH RESPECT TO RECEIVERS FOR WINDING UP THE 2,553
AFFAIRS OF AN ASSOCIATION, SHALL BE APPLICABLE TO ASSOCIATIONS 2,554
JUDICIALLY DISSOLVED.
(E) A PROCEEDING UNDER THIS SECTION FOR JUDICIAL 2,556
DISSOLUTION OF AN ASSOCIATION IS A SPECIAL PROCEEDING, AND FINAL 2,557
ORDERS IN IT MAY BE VACATED, MODIFIED, OR REVERSED ON APPEAL 2,558
PURSUANT TO THE RULES OF APPELLATE PROCEDURE AND, TO THE EXTENT 2,559
NOT IN CONFLICT WITH THOSE RULES, CHAPTER 2505. OF THE REVISED 2,560
CODE.
Sec. 1729.67. (A) A COOPERATIVE AND ANY MEMBER MAY MAKE 2,562
MARKETING AGREEMENTS, WHETHER WRITTEN SEPARATELY OR CONTAINED IN 2,563
THE BYLAWS, IN WHICH THE MEMBER AGREES TO DO ANY OF THE 2,565
FOLLOWING:
64
(1) SELL, MARKET, OR DELIVER ALL OR ANY SPECIFIED PART OF 2,567
PRODUCTS PRODUCED OR TO BE PRODUCED EITHER BY THE MEMBER OR UNDER 2,568
THE MEMBER'S CONTROL, TO OR THROUGH THE COOPERATIVE OR ANY 2,569
FACILITIES FURNISHED BY IT;
(2) AUTHORIZE THE COOPERATIVE OR ANY FACILITIES FURNISHED 2,571
BY IT TO ACT FOR THE MEMBER IN ANY MANNER WITH RESPECT TO ALL OR 2,572
ANY SPECIFIED PART OF PRODUCTS PRODUCED OR TO BE PRODUCED EITHER 2,573
BY THE MEMBER OR UNDER THE MEMBER'S CONTROL AND ANY SERVICES TO 2,574
BE FURNISHED BY THE MEMBER;
(3) BUY OR PROCURE ALL OR A SPECIFIED PART OF GOODS OR 2,576
SERVICES FROM OR THROUGH THE COOPERATIVE OR ANY FACILITIES 2,577
FURNISHED BY IT;
(4) AUTHORIZE THE COOPERATIVE OR ANY FACILITIES FURNISHED 2,579
BY IT TO ACT FOR THE MEMBER IN ANY MANNER IN THE PROCUREMENT OF 2,580
GOODS OR SERVICES FOR THE MEMBER. 2,581
(B) THE TERM OF MARKETING AGREEMENTS MAY NOT EXCEED TEN 2,583
YEARS.
(C) A MARKETING AGREEMENT AUTHORIZED BY DIVISION (A) OF 2,585
THIS SECTION MAY REQUIRE THAT LIQUIDATED DAMAGES BE PAID BY THE 2,586
MEMBER IN THE EVENT OF A BREACH OF THE MARKETING AGREEMENT. 2,587
LIQUIDATED DAMAGES SHALL BE SPECIFIC, REASONABLE SUMS. ANY 2,588
PROVISIONS FOR LIQUIDATED DAMAGES SHALL BE ENFORCEABLE AND NOT 2,589
REGARDED AS PENALTIES.
(D) IF A MEMBER BREACHES OR THREATENS TO BREACH A 2,591
MARKETING AGREEMENT AUTHORIZED BY THIS SECTION, THE COOPERATIVE 2,592
SHALL BE ENTITLED TO AN INJUNCTION TO PREVENT THE BREACH OR ANY 2,593
FURTHER BREACH, AND TO A DECREE OF SPECIFIC PERFORMANCE. UPON 2,594
FILING OF A VERIFIED COMPLAINT SHOWING THE BREACH OR THREATENED 2,595
BREACH, AND UPON FILING A SUFFICIENT BOND, THE COOPERATIVE IS
ENTITLED TO A TEMPORARY RESTRAINING ORDER AGAINST THE MEMBER. 2,596
(E) IF ANY MARKETING AGREEMENT AUTHORIZED BY DIVISION 2,599
(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 2,600
THE MEMBER DURING THE LIFE OF THE MARKETING AGREEMENT FOR ANY 2,601
65
PRODUCT PRODUCED OR TO BE PRODUCED BY THE MEMBER OR FOR ANY 2,602
SERVICES PERFORMED OR TO BE PERFORMED IN PRODUCING ANY PRODUCT, 2,603
ANY PERSON WHO ACCEPTS OR RECEIVES THE PRODUCT FROM THE MEMBER IS 2,604
BOUND BY THE ASSIGNMENT AFTER RECEIVING WRITTEN NOTICE FROM THE
COOPERATIVE OR THE MEMBER OF THE AMOUNT AND DURATION OF THE 2,605
ASSIGNMENT. HOWEVER, AS TO ANY SEASONAL CROP, IF NO FUNDS ARE 2,606
PAID OR BECOME PAYABLE BY ANY PERSON UNDER SUCH AN ASSIGNMENT FOR 2,607
A PERIOD OF TWO CONSECUTIVE YEARS DURING THE LIFE OF THE 2,608
MARKETING AGREEMENT, THEREAFTER THE ASSIGNMENT SHALL NOT BE 2,609
BINDING UPON ANY PERSON WHO RECEIVES OR ACCEPTS SUCH PRODUCT FROM
THE MEMBER UNTIL THE ASSIGNMENT IS REAFFIRMED BY THE MEMBER IN 2,610
WRITING AND WRITTEN NOTICE IS GIVEN BY THE COOPERATIVE OR THE 2,611
MEMBER. ANY SUCH REAFFIRMATION SHALL CONTINUE TO BE EFFECTIVE 2,612
DURING THE LIFE OF THE MARKETING AGREEMENT UNTIL ANOTHER SUCH 2,613
LAPSE OF TWO CONSECUTIVE YEARS OCCURS.
Sec. 1729.68. (A) NO PROCESSOR, HANDLER, DISTRIBUTOR, OR 2,615
DEALER, OR AGENT THEREOF, WHO PURCHASES OR CONTRACTS TO PURCHASE 2,616
ANY PRODUCT FROM A PERSON WHO PRODUCED THE PRODUCT, OR PROCURES 2,617
FOR, SELLS, OR OTHERWISE FURNISHES INPUTS, SERVICES, OR SUPPLIES 2,618
TO A PERSON SHALL DO EITHER OF THE FOLLOWING: 2,619
(1) USE DURESS AGAINST, COERCE, OR BOYCOTT THE PERSON IN 2,621
THE EXERCISE OF THE PERSON'S RIGHTS TO JOIN AND BELONG TO A 2,622
COOPERATIVE;
(2) DISCRIMINATE AGAINST THE PERSON WITH RESPECT TO PRICE, 2,624
QUANTITY, OR QUALITY, OR OTHER TERMS OF PURCHASE OR SALE OF 2,625
PRODUCTS OR PRODUCE, SERVICES, OR SUPPLIES, SOLELY BY REASON OF 2,626
THE PERSON'S MEMBERSHIP IN OR MARKETING AGREEMENT WITH A 2,627
COOPERATIVE.
(B) A MEMBER OR COOPERATIVE ON BEHALF OF ITS MEMBER OR 2,629
MEMBERS MAY BRING AN ACTION TO ENJOIN ANY VIOLATION OF THIS 2,630
SECTION, AND, UPON FILING A SUFFICIENT BOND, A COOPERATIVE IS 2,631
ENTITLED TO A TEMPORARY RESTRAINING ORDER AGAINST ANYONE WHO 2,632
VIOLATES OR THREATENS TO VIOLATE THIS SECTION AS SET FORTH IN THE 2,633
COMPLAINT IN THE COURT OF COMMON PLEAS OF THE COUNTY IN WHICH THE
66
VIOLATION OCCURRED. ACTIONS AGAINST DIFFERENT DEFENDANTS MAY BE 2,634
CONSOLIDATED, IN THE DISCRETION OF THE COURT, IF THE ALLEGED 2,635
VIOLATIONS ARE OF THE SAME PROVISION, HAVE OCCURRED IN THE SAME 2,636
OR ADJOINING COUNTIES, RELATE TO THE SAME PRODUCT, SERVICE, OR 2,637
SUPPLY, AND THE CONSOLIDATION CAN BE MADE WITHOUT PREJUDICE TO A 2,638
SUBSTANTIAL RIGHT OF ANY DEFENDANT.
(C) ANY PERSON WHO SOLICITS OR PERSUADES OR PERMITS OR 2,640
AIDS OR ABETS, INDUCES, OR ATTEMPTS TO INDUCE, ANY MEMBER OR 2,641
OTHER PERSON TO BREACH A MARKETING AGREEMENT WITH A COOPERATIVE, 2,642
BY ACCEPTING OR RECEIVING FROM THE MEMBER OR OTHER PERSON, 2,643
PRODUCTS FOR SALE, MARKETING, MANUFACTURING, OR PROCESSING FOR 2,644
SALE, CONTRARY TO THE TERMS OF ANY MARKETING AGREEMENT OF WHICH
THE INTERFERING PERSON HAS KNOWLEDGE OR NOTICE, IS LIABLE TO THE 2,645
COOPERATIVE FOR DAMAGES CAUSED BY SUCH INTERFERENCE, AND THE 2,646
COOPERATIVE IS ENTITLED TO AN INJUNCTION AGAINST THE INTERFERING 2,647
PERSON TO PREVENT FURTHER BREACHES AND A MULTIPLICITY OF ACTIONS. 2,648
(D) ANY PERSON THAT VIOLATES OR THREATENS TO VIOLATE THIS 2,651
SECTION SHALL PAY TO THE COOPERATIVE THE COOPERATIVE'S REASONABLE 2,652
ATTORNEY'S FEES AND OTHER COSTS INCURRED BY THE COOPERATIVE IN 2,653
ANY LITIGATION OR PROCEEDING AT LAW OR IN EQUITY TO ENFORCE OR 2,654
DEFEND THE COOPERATIVE'S RIGHTS AND INTERESTS THAT ARE PROTECTED 2,655
UNDER THIS SECTION. 2,656
Sec. 1729.69. (A) NO HANDLER SHALL COMMIT AN UNFAIR 2,659
MARKETING PRACTICE, AS DEFINED IN DIVISION (B) OF THIS SECTION, 2,661
WHENEVER A MARKETING COOPERATIVE HAS BEEN AUTHORIZED BY ITS 2,662
MEMBERS TO BARGAIN ON BEHALF OF ITS MEMBERS FOR SALES CONTRACTS 2,663
WITH THE HANDLER AND ANY OF THE FOLLOWING CONDITIONS EXIST: 2,665
(1) MEMBERS OF THE MARKETING COOPERATIVE ARE OBLIGATED TO 2,667
PRODUCE AND DELIVER AGRICULTURAL PRODUCTS OR PRODUCE UNDER SALES 2,668
CONTRACTS NEGOTIATED BY THE MARKETING ASSOCIATION. 2,669
(2) MEMBERS OF THE MARKETING COOPERATIVE REPRESENT, ON THE 2,671
YEARLY AVERAGE CALCULATED OVER THE IMMEDIATE TWO PRECEDING 2,672
CALENDAR YEARS, AT LEAST FIFTY-ONE PER CENT OF THE PRODUCERS WHO 2,673
DELIVERED SUCH PRODUCTS OR PRODUCE TO THE SPECIFIED FACILITY OF 2,674
67
THE HANDLER UNDER SALES CONTRACTS.
(3) MEMBERS OF THE MARKETING COOPERATIVE DELIVERED, UNDER 2,676
SALES CONTRACTS, ON THE YEARLY AVERAGE CALCULATED OVER THE 2,677
IMMEDIATE TWO PRECEDING CALENDAR YEARS, AT LEAST FIFTY PER CENT 2,678
OF THE TOTAL AMOUNT OF SUCH AGRICULTURAL PRODUCTS DELIVERED TO 2,679
SUCH FACILITY UNDER SALES CONTRACTS.
(4) THE MARKETING COOPERATIVE, IF REQUESTED BY THE 2,681
HANDLER, PRESENTS TO THE HANDLER COPIES OF THE AGREEMENTS WITH 2,683
ITS MEMBERS AUTHORIZING THE MARKETING COOPERATIVE TO BARGAIN ON 2,684
BEHALF OF ITS MEMBERS FOR SALES CONTRACTS FOR THE AGRICULTURAL 2,685
PRODUCTS THAT ARE THE SUBJECT OF THE SALES CONTRACT UNDER
NEGOTIATION. 2,686
(B) FOR PURPOSES OF THIS SECTION, IT IS AN UNFAIR 2,689
MARKETING PRACTICE IF EITHER OF THE FOLLOWING APPLIES: 2,690
(1) IF THE HANDLER OR THE MARKETING COOPERATIVE THAT IS 2,692
BARGAINING FAILS TO BARGAIN IN GOOD FAITH IN NEGOTIATING SALES 2,693
CONTRACTS FOR AGRICULTURAL PRODUCTS TO BE DELIVERED TO A FACILITY 2,694
OF THE HANDLER;
(2) IF A HANDLER ENTERS INTO A SALES CONTRACT DIRECTLY 2,696
WITH A PRODUCER, PERTAINING TO AGRICULTURAL PRODUCTS TO BE 2,697
DELIVERED TO THE SAME FACILITY, WITH THE INTENT TO CAUSE THE 2,698
MARKETING COOPERATIVE TO FAIL TO MEET THE CONDITIONS SET FORTH IN 2,699
DIVISIONS (A)(2) AND (3) OF THIS SECTION.
Sec. 1729.70. (A) AN AGRICULTURAL COOPERATIVE IS NOT A 2,701
CONSPIRACY, A COMBINATION IN RESTRAINT OF TRADE, AN ILLEGAL 2,702
MONOPOLY, OR AN ATTEMPT TO LESSEN COMPETITION OR TO FIX PRICES 2,703
ARBITRARILY; AND THE MARKETING AGREEMENTS BETWEEN SUCH AN 2,704
AGRICULTURAL COOPERATIVE AND ITS MEMBERS, OR ANY OTHER MARKETING 2,705
AGREEMENTS OR SALES CONTRACTS AUTHORIZED OR DESCRIBED IN SECTIONS 2,706
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 2,707
COMBINATION TO ACCOMPLISH AN IMPROPER OR ILLEGAL PURPOSE. 2,708
(B) AN AGRICULTURAL COOPERATIVE, UPON RESOLUTION OF ITS 2,710
BOARD, MAY ENTER INTO MARKETING AGREEMENTS AND OTHER ARRANGEMENTS 2,712
68
WITH ANY OTHER AGRICULTURAL COOPERATIVE. ANY TWO OR MORE 2,714
AGRICULTURAL COOPERATIVES MAY, BY AGREEMENT BETWEEN THEM, UNITE 2,715
IN EMPLOYING OR SEPARATELY EMPLOY THE SAME PERSONNEL, METHODS, 2,716
MEANS, AND AGENCIES FOR CARRYING ON THEIR RESPECTIVE BUSINESSES. 2,717
AGRICULTURAL COOPERATIVES, ACTING SINGLY OR COLLECTIVELY, MAY
MEET IN CONFERENCE WITH TWO OR MORE PURCHASERS OF THEIR PRODUCTS 2,718
WHO ARE ACTING COLLECTIVELY, AND MAY AT THE CONFERENCE FIX BY 2,719
AGREEMENT THE PRICES TO BE PAID BY THE PURCHASERS TO THE 2,720
AGRICULTURAL COOPERATIVE FOR THE PRODUCTS. SUCH CONCERTED ACTION 2,721
BY THE PURCHASERS IS NOT A CONTRACT IN RESTRAINT OF TRADE. 2,722
Sec. 1729.25 1729.76. Any corporation or FOREIGN 2,732
association organized under laws of another state that are 2,733
generally similar to sections 1729.01 to 1729.27, inclusive of
the Revised Code, may carry on any proper activities in this 2,734
state upon compliance with the general regulations applicable to 2,735
foreign corporations desiring to do business in this state. All 2,736
contracts which THAT could be made by any association 2,738
incorporated under such sections, THIS CHAPTER AND that are made 2,739
by or with such foreign associations, shall be enforceable in 2,740
this state with all of the remedies set forth in such sections 2,741
THIS CHAPTER.
Sec. 1729.22 1729.80. An association may organize, form, 2,750
operate, own, control, have an interest in, own stock of, or be a 2,752
member of any other corporations engaged in preserving, drying, 2,754
processing, canning, packing, storing, handling, shipping, 2,755
utilizing, manufacturing, marketing, or selling the agricultural
products handled by the association or the by-products of such 2,756
products.
If such other corporations are warehousing corporations, 2,758
they may issue legal warehouse receipts to the association or to 2,760
any other person against commodities delivered to them, and such 2,761
legal warehouse receipts shall be considered an adequate 2,762
collateral to the extent of the usual and current value of the 2,763
commodity represented by them COOPERATIVE, CORPORATION, OR OTHER
69
FORM OF ORGANIZATION. 2,764
Sec. 1729.23 1729.84. Any law which is in conflict with 2,773
sections 1729.01 to 1729.27, inclusive, of the Revised Code, 2,775
shall be construed as not applying to the associations provided 2,776
for in such sections.
Any exemptions under any law applying to agricultural 2,778
products in the possession or under the control of the individual 2,779
producer shall also SHALL apply to such products delivered by its 2,781
farmer PRODUCER members, as long as such products are in the 2,783
possession or under the control of the association AN
AGRICULTURAL COOPERATIVE. 2,784
Sec. 1729.85. MEMBERSHIP STOCK AND PATRONAGE STOCK OF AN 2,786
ASSOCIATION ARE NOT TO BE CONSIDERED SECURITIES UNDER CHAPTER 2,788
1707. OF THE REVISED CODE.
Sec. 1729.86. (A) EXCEPT AS OTHERWISE PROVIDED IN THIS 2,790
CHAPTER, THIS CHAPTER APPLIES TO ALL ASSOCIATIONS, WHETHER 2,791
ORGANIZED UNDER THIS CHAPTER PRIOR TO THE EFFECTIVE DATE OF THIS 2,792
SECTION OR ON OR AFTER THAT DATE.
(B) ANY LAW THAT IS IN CONFLICT WITH THIS CHAPTER SHALL BE 2,794
CONSTRUED AS NOT APPLYING TO ASSOCIATIONS PROVIDED FOR IN THIS 2,795
CHAPTER.
Sec. 1729.99. (A) Whoever violates section 1729.181 2,804
1729.04 of the Revised Code shall be fined not less than fifty 2,805
FIVE HUNDRED nor more than five TWENTY-FIVE hundred dollars for 2,806
each offense. 2,808
(B) Whoever VIOLATES DIVISION (A) OF SECTION 1729.68 OR 2,810
commits an unfair marketing practice as defined in section 2,811
1729.192 1729.69 of the Revised Code shall be fined not less than 2,812
one FIVE hundred nor more than twenty-five hundred FIVE THOUSAND 2,814
dollars for each offense.
Sec. 4517.22. (A) Any group of licensed new motor vehicle 2,823
dealers may display motor vehicles at a motor vehicle show within 2,824
the general market area allocated to a licensed new motor vehicle 2,825
dealer, whenever all of the following conditions are met: 2,826
70
(1) The primary purpose of the motor vehicle show is the 2,828
exhibition of competitive makes and models of motor vehicles to 2,829
provide the general public the opportunity to review and inspect 2,830
various makes and models of motor vehicles at a single location; 2,831
(2) Not less than thirty days before the planned opening 2,833
date of the motor vehicle show, the group requests and receives 2,834
permission to hold the show from the registrar of motor vehicles. 2,835
(B) No contracts shall be signed, deposits taken, or sales 2,837
consummated at the location of a motor vehicle show. 2,838
(C) Any sponsor of a motor vehicle show shall offer by 2,840
mail an invitation to all new motor vehicle dealers dealing in 2,841
competitive types of motor vehicles in the general market area to 2,842
participate and display motor vehicles in the show. The sponsor 2,843
may offer a similar invitation to manufacturers or distributors. 2,844
A copy of each invitation shall be retained by the sponsor for at 2,845
least one year after the show.
(D) No person except a manufacturer or distributor shall 2,847
hold in any public place a motor vehicle show at which only one 2,848
motor vehicle is displayed, and no such single unit show shall be 2,849
held unless the manufacturer or distributor requests and receives 2,851
permission from the registrar not less than thirty days before 2,852
the show.
(E) The registrar shall not grant permission for any motor 2,854
vehicle show to be held, unless it is proven to his THE 2,855
REGISTRAR'S satisfaction that no attempt is being made to 2,857
circumvent the provisions of sections 4517.01 to 4517.45 of the
Revised Code. 2,858
(F) Nothing contained in this section shall be construed 2,860
as prohibiting the taking of orders for nonmotorized recreational 2,861
vehicles as defined in section 4501.01 of the Revised Code at 2,863
sports or camping shows. 2,864
(G) No motor vehicle dealer, motor vehicle leasing dealer, 2,866
motor vehicle auction owner, or distributor licensed under 2,867
sections 4517.01 to 4517.45 of the Revised Code shall display a 2,868
71
motor vehicle at any place except his THE DEALER'S, OWNER'S, OR 2,869
DISTRIBUTOR'S licensed location, unless he THE DEALER, OWNER, OR 2,870
DISTRIBUTOR first obtains permission from the registrar and 2,871
complies with the applicable rules of the motor vehicle dealers 2,872
board.
(H) NOTHING CONTAINED IN THIS SECTION SHALL BE CONSTRUED 2,874
AS PROHIBITING THE DISPLAY OF, THE TAKING OF ORDERS FOR, OR THE 2,875
SALE OF, LIVESTOCK TRAILERS AT LIVESTOCK AND AGRICULTURAL SHOWS, 2,876
INCLUDING COUNTY FAIRS. NOTWITHSTANDING SECTION 4517.03 OF THE 2,877
REVISED CODE, LIVESTOCK TRAILERS MAY BE SOLD AT LIVESTOCK AND
AGRICULTURAL SHOWS, INCLUDING COUNTY FAIRS, AS PERMITTED BY THIS 2,878
DIVISION.
AS USED IN THIS DIVISION, "LIVESTOCK TRAILER" MEANS A NEW 2,880
OR USED TRAILER DESIGNED BY ITS MANUFACTURER TO BE USED TO 2,881
TRANSPORT HORSES OR TO TRANSPORT ANIMALS GENERALLY USED FOR FOOD 2,883
OR IN THE PRODUCTION OF FOOD, INCLUDING CATTLE, SHEEP, GOATS, 2,884
RABBITS, POULTRY, SWINE, AND ANY OTHER ANIMALS INCLUDED BY THE
DIRECTOR OF AGRICULTURE IN RULES ADOPTED UNDER SECTION 901.72 OF 2,885
THE REVISED CODE.
(I) Notwithstanding division (B) of this section, 2,887
contracts may be signed, deposits taken, and sales consummated at 2,888
the location of a motor vehicle show where the motor vehicles 2,889
involved are horse trailers or towing vehicles that are trucks 2,890
and have a gross vehicle weight of more than three-quarters of a 2,891
ton, the motor vehicle show is being held as part of or in 2,892
connection with a major livestock show, the licensed new motor
vehicle dealers involved have complied with the applicable 2,894
requirements of this section, and the registrar has granted 2,895
permission for the motor vehicle show in accordance with division 2,896
(E) of this section.
As used in division (H)(I) of this section: 2,898
(1) "Major livestock show" means any show of livestock 2,900
that is held at the Ohio state fairgrounds, is national in scope, 2,902
and that continues for more than ten consecutive days. 2,903
72
(2) "Truck" has the same meaning as in section 4511.01 of 2,905
the Revised Code.
(3) "Gross vehicle weight" means the unladen weight of the 2,907
vehicle fully equipped. 2,908
Section 2. That existing sections 917.01, 917.16, 1707.02, 2,911
1729.02, 1729.03, 1729.05, 1729.07, 1729.15, 1729.16, 1729.22, 2,912
1729.23, 1729.25, 1729.99, and 4517.22 and sections 1729.01, 2,913
1729.04, 1729.06, 1729.08, 1729.09, 1729.10, 1729.11, 1729.12, 2,914
1729.13, 1729.14, 1729.17, 1729.18, 1729.181, 1729.19, 1729.191, 2,915
1729.192, 1729.20, 1729.21, 1729.24, 1729.26, 1729.27, 1729.28, 2,916
1729.30, 1729.31, 1729.32, 1729.33, 1729.34, 1729.35, 1729.36, 2,917
and 1729.37 of the Revised Code are hereby repealed. 2,918