2007 Minnesota Code
Chapters 300 - 319B Corporations
Chapter 308B Cooperative Associations Act
Section 308B.701 AUTHORIZATION, FORM, AND ACCEPTANCE OF CONTRIBUTIONS.

308B.701 AUTHORIZATION, FORM, AND ACCEPTANCE OF CONTRIBUTIONS.
Subdivision 1. Board of directors may authorize. Subject to any restrictions in this
chapter regarding patron and nonpatron membership interests or in the articles or bylaws, and
only when authorized by the board, a cooperative may accept contributions, which may be patron
or nonpatron membership contributions as determined by the board under subdivisions 2 and
3, make contribution agreements under section 308B.711, and make contribution allowance
agreements under section 308B.715.
Subd. 2. Permissible forms. A person may make a contribution to a cooperative:
(1) by paying money or transferring the ownership of an interest in property to the
cooperative or rendering services to or for the benefit of the cooperative; or
(2) through a written obligation signed by the person to pay money or transfer ownership
of an interest in property to the cooperative or to perform services to or for the benefit of the
cooperative.
Subd. 3. Acceptance of contributions. No purported contribution is to be treated or
considered as a contribution, unless:
(1) the board accepts the contribution on behalf of the cooperative and in that acceptance
describes the contribution, including terms of future performance, if any, and states the value
being accorded to the contribution; and
(2) the fact of contribution and the contribution's accorded value are both reflected in the
required records of the cooperative.
Subd. 4. Valuation. The determinations of the board as to the amount or fair value or the
fairness to the cooperative of the contribution accepted or to be accepted by the cooperative or the
terms of payment or performance, including under a contribution agreement in section 308B.711,
and a contribution allowance agreement in section 308B.715, are presumed to be proper if they
are made in good faith and on the basis of accounting methods, or a fair valuation or other
method, reasonable in the circumstances. Directors who are present and entitled to vote, and who,
intentionally or without reasonable investigation, fail to vote against approving a consideration
that is unfair to the cooperative, or overvalue property or services received or to be received by
the cooperative as a contribution, are jointly and severally liable to the cooperative for the benefit
of the then members who did not consent to and are damaged by the action, to the extent of the
damages of those members. A director against whom a claim is asserted under this subdivision,
except in case of knowing participation in a deliberate fraud, is entitled to contribution on an
equitable basis from other directors who are liable under this subdivision.
History: 2003 c 105 art 1 s 60