US Laws, Codes, Statutes & Cases

Chapter 62 — Cooperatives

 

2005 EDITION

 

 

COOPERATIVES

 

CORPORATIONS AND PARTNERSHIPS

 

GENERAL PROVISIONS

 

(Short Title and Definitions)

 

62.005       Short title

 

62.015       Definitions

 

(Filing Documents)

 

62.025       Filing requirements

 

62.030       Filing, service, copying and certification fees

 

62.035       Effective time and date of document

 

62.040       Correcting filed document

 

62.045       Forms; rules

 

62.050       Filing duty of Secretary of State

 

62.055       Appeal from Secretary of State’s refusal to file document

 

62.060       Evidentiary effect of copy of filed document

 

62.065       Certificate of existence

 

SUBSTANTIVE PROVISIONS

 

62.115       Purposes for which cooperatives may be organized

 

62.125       General powers

 

62.128       Reserved name

 

62.131       Cooperative name

 

62.135       Bylaws

 

62.145       Membership

 

62.155       Registered office and registered agent; service of process on cooperative

 

62.165       Actions in excess of authority

 

62.175       Capital stock; membership stock

 

62.185       Certificates of stock; contents

 

62.195       Voting by shareholders

 

62.205       Subscription agreement for shares or agreement to pay a membership fee; default

 

62.215       Limitation of liability of members and shareholders

 

62.225       Dividends on capital stock

 

62.235       Recall, exchange or redemption of stock or other evidence of equity by cooperative

 

62.245       Missing certificates or evidence of interest in cooperative; missing records relating to redemption of interest in cooperative

 

62.255       Meetings of members

 

62.265       Voting by members

 

62.275       Quorum of members

 

62.280       Board of directors

 

62.283       Standard of conduct for directors; permissible reliance on opinions and reports of others; limitation of liability

 

62.284       Director conflict of interest

 

62.285       Meetings of board of directors

 

62.286       Loans to or guarantees for directors

 

62.287       Directors’ meeting by conference telephone or similar communications equipment

 

62.290       Executive committee

 

62.295       Officers

 

62.300       Compensation and benefits to directors, officers and employees

 

62.305       Taking action without meeting; effective date of action

 

62.315       Waiver of notice

 

62.325       Voting requirements of articles

 

62.335       Action brought in right of cooperative by member or shareholder; attorney fees

 

62.355       Cooperative contracts

 

62.360       Recording cooperative contracts

 

62.365       Relief against breach or threatened breach of contract; penalty for interference

 

62.370       Civil action for inducing breach of contract with cooperative or spreading false reports about cooperative

 

62.415       Apportionment and distribution of net proceeds or savings or net losses

 

62.425       Unclaimed distribution, redemptions or payments

 

62.430       Payments in name of deceased owner of capital credits or retains in cooperative

 

62.435       Sale or other disposition of entire assets

 

62.440       Books and records; attorney fees

 

62.455       Annual report; form; effect of error; amendment

 

INDEMNIFICATION OF DIRECTORS

 

62.462       Definitions for ORS 62.462 to 62.482

 

62.464       Authority to indemnify director; report to members

 

62.466       Mandatory indemnification of director

 

62.468       Advance for expenses

 

62.472       Court-ordered indemnification

 

62.474       Determination and authorization of indemnification

 

62.476       Indemnification of officers, employees and agents

 

62.478       Insurance

 

62.482       Application of ORS 62.462 to 62.482

 

FORMATION OF COOPERATIVES

 

62.511       Incorporators; articles of incorporation

 

62.513       Contents of articles of incorporation

 

62.515       Organization meeting of directors

 

AMENDMENT OF ARTICLES

 

62.555       Right to amend articles of incorporation

 

62.560       Shareholder voting on amendments to articles

 

62.565       Articles of amendment; effect of amendment

 

62.570       Restated articles

 

CONVERSIONS AND MERGERS

 

62.605       Definitions for ORS 62.605 to 62.623

 

62.607       Conversion

 

62.609       Action on plan of conversion

 

62.611       Articles of conversion

 

62.613       Effect of conversion; entity existence continues

 

62.617       Merger; plan of merger

 

62.619       Action on plan of merger

 

62.621       Articles of merger

 

62.623       Effect of merger

 

DISSOLUTION

 

62.655       Voluntary dissolution by act of cooperative

 

62.665       Procedure for dissolution

 

62.670       Revocation of voluntary dissolution

 

62.675       Effect of revocation of voluntary dissolution

                  proceedings

 

62.680       Articles of dissolution

 

62.685       Effect of filing articles of dissolution

 

62.690       Administrative dissolution

 

62.695       Jurisdiction of court to dissolve cooperative and liquidate assets and business of cooperative

 

62.702       Procedure for dissolution of cooperative by court

 

62.704       Judgment of dissolution issued by court

 

62.708       Effect of dissolution

 

62.712       Disposition of known claims against dissolved cooperative

 

62.714       Notice of dissolution; presentation of claims against cooperative

 

62.720       Presumption of abandonment; procedure for agriculture cooperatives and others

 

FOREIGN COOPERATIVES

 

62.755       Admission of foreign cooperatives

 

62.760       Registration of name of foreign cooperative

 

EMPLOYEE COOPERATIVES

 

62.765       Definitions for ORS 62.765 to 62.792

 

62.768       Election to be governed as employee cooperative; corporate name

 

62.771       Revocation of election to be governed as employee cooperative

 

62.774       Qualifications of members; membership shares; rights of members

 

62.777       Membership powers

 

62.780       Apportionment of net earnings or losses

 

62.783       Internal capital accounts; redemption of shares; collective reserve account

 

62.786       Internal capital account cooperative

 

62.789       Procedure for revocation of election; limits on merger

 

62.792       Short title

 

MISCELLANEOUS PROVISIONS

 

62.825       Powers of Secretary of State

 

62.845       Public policy; certain cooperative activities not unlawful restraint of trade

 

62.848       Antitrust immunity for negotiations governing price for sale of grass seed; supervision by Director of Agriculture; rules; fees

 

62.849       Antitrust immunity for negotiations governing season starting price for sale of Oregon seafood; supervision by Director of Agriculture; rules; fees

 

62.850       Use of term “cooperative”

 

62.855       Application of chapter

 

62.860       Effect of amendment or repeal of Oregon Cooperative Corporation Act

 

62.865       Effect of repeal of prior statutes

 

62.870       Notice to members of agricultural cooperative; date; contents; effect of failure to send notice

 

GENERAL PROVISIONS

 

(Short Title and Definitions)

 

      62.005 Short title. This chapter shall be known and may be cited as the “Oregon Cooperative Corporation Act.” [1957 c.716 §1]

 

      62.010 [Repealed by 1957 c.716 §76]

 

      62.015 Definitions. As used in this chapter, unless the context requires otherwise:

      (1) “Anniversary” means that day each year exactly one or more years after:

      (a) The date of filing by the Secretary of State of the articles of incorporation in the case of a domestic cooperative.

      (b) The date of filing by the Secretary of State of an application for authority to transact business in the case of a foreign cooperative.

      (2) “Articles” means articles of incorporation, articles of conversion and articles of merger.

      (3) “Board” means board of directors.

      (4) “Cooperative” means a cooperative corporation which is subject to the provisions of this chapter.

      (5) “Corporation” means a corporation which is not a cooperative.

      (6) “Domestic limited liability company” means an entity that is an unincorporated association having one or more members and that is organized under ORS chapter 63.

      (7) “Domestic nonprofit corporation” means a corporation not for profit incorporated under ORS chapter 65.

      (8) “Domestic professional corporation” means a corporation organized under ORS chapter 58 for the purpose of rendering professional services and for the purposes provided under ORS chapter 58.

      (9) “Foreign cooperative” means a cooperative corporation organized under laws other than the laws of this state.

      (10) “Foreign corporation” means a corporation for profit incorporated under the laws of a state other than this state.

      (11) “Foreign limited liability company” means an entity that is an unincorporated association organized under the laws of a state other than this state, under the laws of a federally recognized Indian tribe or under the laws of a foreign country and that is organized under a statute under which an association may be formed that affords to each of its members limited liability with respect to liabilities of the entity.

      (12) “Foreign nonprofit corporation” means a corporation not for profit organized under the laws of a state other than this state.

      (13) “Foreign professional corporation” means a professional corporation organized under the laws of a state other than this state.

      (14) “Member” means a person who has been qualified and accepted for membership in a cooperative.

      (15) “Membership stock” means any class of stock, continuous ownership of which is required for membership in a cooperative.

      (16) “Negotiate” means to confer with another in order to come to terms.

      (17) “Person” includes individuals, corporations, associations, firms, partnerships, joint stock companies, trusts, estates and foreign and domestic cooperative corporations.

      (18) “Shareholder” means a holder of shares of capital stock of a cooperative other than membership stock. [1957 c.716 §2; 1963 c.492 §41; 1974 c.2 §4; 1987 c.94 §78; 1995 c.195 §1; 1999 c.362 §16; 2001 c.142 §1; 2001 c.315 §33; 2005 c.107 §2]

 

      62.020 [Repealed by 1957 c.716 §76]

 

(Filing Documents)

 

      62.025 Filing requirements. (1) A document must satisfy the requirements of this section or any other section that modifies these requirements, to be entitled to filing by the Secretary of State.

      (2) This chapter must require or permit filing the document with the Office of Secretary of State.

      (3) The document shall contain the information required by this chapter. It may contain other information as well.

      (4) The document must be legible.

      (5) The document must be in the English language.

      (6) The document must be executed:

      (a) By the chairperson of the board of directors of a domestic cooperative, its president or another of its officers;

      (b) If directors have not been selected or before the organizational meeting, by an incorporator; or

      (c) If the cooperative is in the hands of a receiver, trustee or other court-appointed fiduciary, by that receiver, trustee or fiduciary.

      (7) The person executing the document shall state beneath or opposite the signature the name of the person and the capacity in which the person signs. The document may, but is not required to contain:

      (a) The corporate seal;

      (b) An attestation by the secretary or an assistant secretary; and

      (c) An acknowledgment, verification or proof.

      (8) If the Secretary of State has prescribed a mandatory form for the document under ORS 62.045, the document must be in or on the prescribed form.

      (9) The document must be delivered to the Office of Secretary of State and must be accompanied by the required fees.

      (10) Delivery of a document to the Office of Secretary of State is accomplished only when the document is actually received by the Office of Secretary of State. [1987 c.94 §69; 1999 c.486 §7]

 

      62.030 Filing, service, copying and certification fees. The Secretary of State shall collect the fees described in ORS 56.140 for each document delivered for filing under this chapter and for process served on the secretary under this chapter. The secretary may collect the fees described in ORS 56.140 for copying any public record under this chapter, certifying the copy or certifying to other facts of record under this chapter. [1987 c.94 §71; 1991 c.132 §4; 1995 c.195 §35; 1999 c.362 §§17,17a]

 

      62.035 Effective time and date of document. (1) Except as provided in subsection (2) of this section and ORS 62.040, a document accepted for filing is effective on the date it is filed by the Secretary of State and at the time, if any, specified in the document as its effective time or at 12:01 a.m. on that date if no effective time is specified.

      (2) If a document specifies a delayed effective time and date, the document becomes effective at the time and date specified. If a document specifies a delayed effective date but no time, the document becomes effective at 12:01 a.m. on that date. A delayed effective date for a document may not be later than the 90th day after the date it is filed. [1987 c.94 §72; 1995 c.195 §36]

 

      62.040 Correcting filed document. (1) A cooperative may correct a document filed by the Secretary of State, other than an annual report, if the document contains an incorrect statement or was defectively executed, attested, sealed, verified or acknowledged.

      (2) A cooperative shall correct a document by delivering articles of correction to the Office of Secretary of State. The articles shall include the following:

      (a) A description of the document, including its filing date, or a copy of the document.

      (b) The incorrect statement and the reason it is incorrect, or a description of the manner in which the execution, attestation, seal, verification or acknowledgment is defective.

      (c) A correction of the incorrect statement or defective execution, attestation, seal, verification or acknowledgment.

      (3) Articles of correction are effective on the effective date of the document they correct except as to persons relying on the uncorrected document and adversely affected by the correction. As to those persons, articles of correction are effective when filed. [1987 c.94 §73]

 

      62.045 Forms; rules. Upon request, the Secretary of State may furnish forms for documents required or permitted to be filed by this chapter. The Secretary of State may by rule require the use of the forms. [1987 c.94 §70; 1995 c.215 §9]

 

      62.050 Filing duty of Secretary of State. (1) If a document delivered to the Office of Secretary of State for filing satisfies the requirements of ORS 62.025, the Secretary of State shall file it.

      (2) The Secretary of State files a document by indicating thereon that it has been filed by the Secretary of State and the date of filing. After filing a document, except as provided in ORS 62.155 and 62.455, the Secretary of State shall return an acknowledgment of filing to the cooperative or its representative.

      (3) If the Secretary of State refuses to file a document, the Secretary of State shall return it to the cooperative or its representative within 10 business days after the document was delivered together with a brief written explanation of the reason for the refusal.

      (4) The Secretary of State’s duty to file documents under this section is ministerial and is limited in scope of review as set out by rule of the Secretary of State. The Secretary of State is not required to verify or inquire into the legality or truth of any matter included in any document delivered to the Office of Secretary of State for filing. The Secretary of State’s filing or refusing to file a document does not:

      (a) Affect the validity or invalidity of the document in whole or part; or

      (b) Relate to the correctness or incorrectness of information contained in the document.

      (5) The Secretary of State’s refusal to file a document does not create a presumption that the document is invalid or that information contained in the document is incorrect. [1987 c.94 §74; 1999 c.486 §8]

 

      62.055 Appeal from Secretary of State’s refusal to file document. If the Secretary of State refuses to file a document delivered to the Office of Secretary of State for filing, the cooperative, in addition to any other legal remedy that may be available, shall have the right to appeal from such order pursuant to the provisions of ORS 183.480. [1987 c.94 §75]

 

      62.060 Evidentiary effect of copy of filed document. (1) A certificate attached to a copy of a document filed by the Secretary of State, bearing the Secretary of State’s signature, which may be in facsimile, is conclusive evidence that the original document, or a facsimile thereof, is on file with the Office of Secretary of State.

      (2) The provisions of ORS 56.110 apply to all documents filed pursuant to this chapter. [1987 c.94 §76]

 

      62.065 Certificate of existence. (1) Anyone may apply to the Secretary of State to furnish a certificate of existence for a cooperative.

      (2) A certificate of existence when issued means that:

      (a) The cooperative’s corporate name is registered in this state;

      (b) The cooperative is duly incorporated under the law of this state;

      (c) All fees payable to the Secretary of State under this chapter have been paid, if nonpayment affects the existence or authorization of the cooperative;

      (d) An annual report required by ORS 62.455 has been filed by the Secretary of State within the preceding 14 months; and

      (e) Articles of dissolution have not been filed by the Secretary of State.

      (3) A person may apply to the Secretary of State to issue a certificate covering any fact of record.

      (4) Subject to any qualification stated in the certificate, a certificate of existence or authorization issued by the Secretary of State may be relied upon as conclusive evidence that the domestic or foreign cooperative is in existence or is authorized to transact business in the state. [1987 c.94 §77; 1995 c.195 §37]

 

      62.110 [Repealed by 1957 c.716 §76]

 

SUBSTANTIVE PROVISIONS

 

      62.115 Purposes for which cooperatives may be organized. Cooperatives may be organized under this chapter for any lawful purpose or purposes, except for the purpose of banking or insurance. [1957 c.716 §3]

 

      62.120 [Repealed by 1957 c.716 §76]

 

      62.125 General powers. Each cooperative shall have power:

      (1) To have perpetual succession unless a limited period of duration is stated in its articles.

      (2) To sue and be sued, complain and defend, in its corporate name.

      (3) To have a corporate seal which may be altered at pleasure, and to use the seal by causing it, or a facsimile thereof, to be impressed or affixed or in any other manner reproduced.

      (4) To purchase, take, receive, lease, take by gift, devise or bequest, or otherwise acquire, own, hold, improve, use and otherwise deal in and with, real or personal property, or any interest therein, wherever situated.

      (5) To sell, convey, mortgage, pledge, lease, exchange, transfer and otherwise dispose of, all or any part of its property and assets.

      (6) To purchase, take, receive, subscribe for, or otherwise acquire, own, hold, vote, use, employ, sell, mortgage, lend, pledge, or otherwise dispose of, and otherwise use and deal in and with, shares or other interests in, or obligations of, other domestic or foreign cooperatives and corporations, partnerships or individuals, or direct or indirect obligations of the United States or of any other government, state, territory, governmental district or municipality or of any instrumentality thereof.

      (7) To make contracts and incur liabilities, borrow money at such rates of interest as the cooperative may determine, issue its notes, bonds, certificates of indebtedness and other obligations, issue certificates representing equity interests in its assets, and secure any of its obligations by mortgage or pledge of all or any of its property, franchises and income.

      (8) To lend money for its corporate purposes, invest and reinvest its funds and take and hold real and personal property as security for the payment of funds so loaned or invested.

      (9) To conduct its business and affairs and have offices and exercise its powers in any state, territory, district or possession of the United States, or in any foreign country.

      (10) To elect or appoint officers and agents, and define their duties and fix their compensation.

      (11) To make and alter bylaws, consistent with its articles and the laws of this state, for the administration and regulation of its affairs.

      (12) To make donations for the public welfare or for charitable, scientific or educational purposes.

      (13) To cease its activities and surrender its franchise.

      (14) To have and exercise all powers necessary or convenient to effect any or all of the purposes for which the cooperative is organized. [1957 c.716 §4; 1981 c.542 §1]

 

      62.128 Reserved name. (1) A person may apply to the Office of Secretary of State to reserve a corporate name. The application must set forth the name and address of the applicant and the name proposed to be reserved.

      (2) If the Secretary of State finds that the corporate name applied for conforms to ORS 62.131, the Secretary of State shall reserve the name for the applicant for a 120-day period.

      (3) A person may transfer the reservation of a corporate name to another person by delivering to the Office of Secretary of State a notice of the transfer executed by the person for whom the name was reserved and specifying the name and address of the transferee. [1969 c.364 §2; 1987 c.94 §79]

 

      62.130 [Repealed by 1957 c.716 §76]

 

      62.131 Cooperative name. (1) The name of a cooperative shall be written in the English language and may include Arabic and Roman numerals and incidental punctuation.

      (2) The name of a cooperative shall be distinguishable upon the records of the Office of Secretary of State from any other corporate name, professional corporate name, nonprofit corporate name, cooperative name, limited partnership name, reserved name, registered corporate name or assumed business name of active record with the Office of Secretary of State.

      (3) The name of a cooperative need not satisfy the requirement of subsection (2) of this section if the applicant delivers to the Office of Secretary of State a certified copy of a final judgment of a court of competent jurisdiction that finds that the applicant has a prior or concurrent right to use the cooperative name in this state.

      (4) The provisions of this section do not prohibit a cooperative from transacting business under an assumed business name.

      (5) The provisions of this section do not:

      (a) Abrogate or limit the law governing unfair competition or unfair trade practices.

      (b) Derogate from the common law, the principles of equity or the statutes of this state or of the United States with respect to the right to acquire and protect trade names. [1987 c.94 §84]

 

      62.135 Bylaws. The initial bylaws of a cooperative shall be adopted by its board of directors. Power to alter, amend or repeal the bylaws or adopt new bylaws is vested in the members of the cooperative. Bylaws may contain any provisions for the regulation and management of the affairs of the cooperative not inconsistent with law or the articles. [1957 c.716 §8]

 

      62.140 [Repealed by 1957 c.716 §76]

 

      62.145 Membership. (1) Membership in a cooperative is conditioned on ownership of a share of membership stock or payment of a membership fee as set forth in the articles. If the articles so provide, the bylaws may authorize a procedure by which the membership fee initially stated in the articles pursuant to ORS 62.513 (1)(c) may be changed without filing amended or restated articles. The bylaws of a cooperative may authorize membership conditioned upon payment of part of the membership fee or payment for part of the membership stock subscribed for and compliance with an agreement to pay the balance.

      (2) Qualifications for membership and method of acceptance of members shall be as set forth in the bylaws of the cooperative.

      (3) Bylaws may provide for termination of membership and the conditions and terms thereof. [1957 c.716 §9; 1995 c.195 §2]

 

      62.150 [Repealed by 1957 c.716 §76]

 

      62.155 Registered office and registered agent; service of process on cooperative. (1) Each cooperative shall have and continuously maintain in this state:

      (a) A registered office which may, but need not be, the same as its place of business.

      (b) A registered agent who shall be:

      (A) An individual resident in this state whose business office is identical to such registered office;

      (B) A domestic corporation, domestic limited liability company, domestic professional corporation or domestic nonprofit corporation having a business office identical to such registered office; or

      (C) A foreign corporation, foreign limited liability company, foreign professional corporation or foreign nonprofit corporation authorized to transact business in this state and having a business office identical to such registered office.

      (2) A cooperative may change its registered office or registered agent in accordance with the procedure set forth in ORS 60.114.

      (3) A person who has been designated by a cooperative as its registered agent may resign in accordance with the procedure set forth in ORS 60.117.

      (4) A registered agent appointed by a cooperative is an agent of the cooperative upon whom any process, notice or demand required or permitted by law to be served upon the cooperative may be served.

      (5) The provisions of ORS 60.121 are applicable to cooperatives. [1957 c.716 §10; 1987 c.94 §80; 2001 c.315 §26]

 

      62.160 [Repealed by 1957 c.716 §76]

 

      62.165 Actions in excess of authority. No act and no transfer of property to or by a cooperative is invalid because in excess of the cooperative’s power to do such act or make or receive such transfer, except that such lack of power may be asserted in a proceeding by:

      (1) A member, shareholder or director against the cooperative to enjoin any act or transfer of property to or by the cooperative. If the unauthorized acts or transfer sought to be enjoined are being, or are to be, performed or made pursuant to any contract to which the cooperative is a party, the court may, if all of the parties to the contract are parties to the proceeding and if it deems the same to be equitable, set aside and enjoin the performance of the contract, and in so doing may allow to the cooperative or to the other parties to the contract, as the case may be, compensation for the loss or damage sustained by either of them which may result from the action of the court in setting aside and enjoining the performance of the contract but anticipated profits to be derived from the performance of the contract shall not be awarded by the court as a loss or damage sustained.

      (2) A cooperative, its legal representative, or through its members or shareholders in a representative suit, against the officers or directors or former officers or directors of the cooperative.

      (3) The Attorney General against the cooperative in an action to dissolve the cooperative or to enjoin it from the transaction of unauthorized business. [1957 c.716 §11]

 

      62.170 [Repealed by 1957 c.716 §76]

 

      62.175 Capital stock; membership stock. (1) Any cooperative, including a cooperative which requires a membership fee rather than the holding of membership stock as a prerequisite of membership, has power to issue the number of shares of capital stock stated in its articles. Such shares may be divided into more than one class with such designations, preferences, limitations and relative rights as shall be stated in the articles, except that capital stock as such shall have no voting power except as specifically authorized in this chapter.

      (2) The articles may require that members own one or more shares of membership stock, and may provide limitations on the issuance and transferability of such stock. Unless restricted by the articles, stock other than membership stock may be issued or transferred without limitation.

      (3) Shares having a par value may be issued for such consideration expressed in dollars, not less than the par value thereof, as shall be fixed from time to time by the board. Shares without par value, may be issued for such consideration expressed in dollars as may be fixed for such shares by the board. Payment for shares may be in cash or other property, tangible or intangible. If in other property, the value thereof shall be determined by the board, and such determination, if made in good faith, is conclusive.

      (4) No certificate shall be issued for any share until such share is fully paid.

      (5) Shareholders as such have no preemptive right to purchase additional shares. [1957 c.716 §12; 1963 c.156 §1]

 

      62.180 [Repealed by 1957 c.716 §76]

 

      62.185 Certificates of stock; contents. Each certificate of stock of a cooperative shall bear the manual or facsimile signature of a principal officer and shall include the following information:

      (1) The name of the cooperative, number and class of the shares represented by the certificate, the par value of each share or a statement that the shares are without par value, and if the shares are membership stock, their designation as such.

      (2) Any restrictions on the issuance or transfer of such shares.

      (3) If more than one class of stock is authorized or if stock is authorized in a cooperative which requires a membership fee of its members, designation of the several classes of stock and the respective preferences, limitations and relative rights of such classes. In lieu of a full statement, the information required by this subsection may be given in summary form. [1957 c.716 §13]

 

      62.190 [Repealed by 1957 c.716 §76]

 

      62.195 Voting by shareholders. (1) A shareholder may vote either in person or by proxy executed in writing by the shareholder or by the duly authorized attorney-in-fact of the shareholder. No proxy shall be valid after 11 months from the date of its execution unless otherwise provided in the proxy. The following provisions, relating to voting of shares, apply to shareholders of cooperatives and shares of the capital stock of cooperatives other than membership stock:

      (a) Shares standing in the name of another domestic or foreign cooperative may be voted by such officer, agent or proxy as the bylaws of the cooperative may prescribe, or, in the absence of such provision, as the board of directors of the cooperative may determine.

      (b) An administrator, executor, guardian or conservator holding shares may vote the shares, either in person or by proxy, without a transfer of such shares into the name of the administrator, executor, guardian or conservator. Shares standing in the name of a trustee may be voted by the trustee, either in person or by proxy, but no trustee shall be entitled to vote shares held by the trustee without a transfer of the shares into the trustee’s name.

      (c) Shares standing in the name of a receiver may be voted by the receiver, and shares held by or under control of a receiver may be voted by the receiver without the transfer thereof into the receiver’s name if authority so to do is contained in an appropriate order of the court by which the receiver was appointed.

      (d) A shareholder whose shares are pledged shall be entitled to vote the shares until the shares have been transferred into the name of the pledgee, and thereafter the pledgee shall be entitled to vote the shares so transferred.

      (3) For the purpose of determining shareholders entitled to notice of or to vote at meetings, or entitled to receive payment of any dividend, the bylaws may fix in advance a date as the record date for any such determination of shareholders. Such date shall be not more than 50 days and not less than 10 days prior to the date on which the particular action requiring such determination of shareholders is to be taken. If no such record date is fixed by the bylaws, the date on which notice of the meeting is mailed or the date on which the resolution of the board of directors declaring such dividend is adopted, as the case may be, shall be the record date for such determination of shareholders. When a determination of shareholders entitled to vote at any meeting has been made as provided in this section, such determination shall apply to any adjournment of that meeting. [1957 c.716 §15; 1987 c.94 §81]

 

      62.200 [Repealed by 1957 c.716 §76]

 

      62.205 Subscription agreement for shares or agreement to pay a membership fee; default. (1) A subscription agreement for shares, including membership stock, of a cooperative, where the subscription is entered into before incorporation, or an agreement entered into before incorporation to pay a membership fee is irrevocable for six months unless:

      (a) Otherwise provided by the subscription agreement or the agreement to pay a membership fee; or

      (b) All subscribers or parties to all the agreements to pay a membership fee consent to the revocation.

      (2) If a subscriber defaults in payment of money or property under a subscription agreement entered into before incorporation, or if a party to an agreement to pay a membership fee defaults in the payment of money or property under an agreement to pay a membership fee entered into before incorporation, the cooperative may collect the amount owed as any other debt. Alternatively, unless the subscription agreement or agreement to pay a membership fee provides otherwise, the cooperative may rescind the agreement if the debt remains unpaid more than 20 days after the cooperative sends written demand for payment to the subscriber or the party. [1957 c.716 §16; 1995 c.195 §3]

 

      62.210 [Repealed by 1957 c.716 §76]

 

      62.215 Limitation of liability of members and shareholders. Except for debts lawfully contracted between a member or shareholder and the cooperative, no member or shareholder is liable for the acts or debts of the cooperative to an amount exceeding the sum remaining unpaid on the subscription of the member or shareholder for shares of the cooperative, and the sum remaining unpaid on such member’s membership fee if such fee is required by the cooperative. [1957 c.716 §17; 1995 c.195 §4]

 

      62.220 [Repealed by 1957 c.716 §76]

 

      62.225 Dividends on capital stock. A cooperative organized with capital stock may pay a dividend upon capital stock as is authorized by its articles. A payment under this section shall not be made if the result of the payment would be to bring the value of the cooperative’s remaining assets below the aggregate of the cooperative’s indebtedness. [1957 c.716 §18; 1995 c.195 §5]

 

      62.230 [Repealed by 1957 c.716 §76]

 

      62.235 Recall, exchange or redemption of stock or other evidence of equity by cooperative. (1) Unless the articles provide otherwise, a cooperative may recall membership stock upon termination of membership, acquire, exchange, redeem, and reissue its own shares or other evidences of equity. Consideration paid for shares of membership stock recalled by the cooperative shall be the par value thereof and accrued and unpaid dividends, if any, except that if such shares have no par value the consideration paid therefor shall be the consideration in dollars for which the shares were issued plus accrued and unpaid dividends. The cooperative may set off obligations to it of the holder of membership stock or other stock or other evidence of equity, including capital credits or accounts representing capital credits. The cooperative shall have a continuing perfected security interest in the evidence of equity, capital credits or accounts representing capital credits to secure payment of any indebtedness, whenever incurred, owed to the cooperative by the holder. Notwithstanding any other provision of law, the security interest shall take priority over all other perfected security interests. No such acquisition, recall or redemption of stock or other evidence of equity shall be made if the result thereof would be to bring the value of the remaining assets of the cooperative below the aggregate of its indebtedness. The articles may provide other limitations on the right of a cooperative to acquire, recall, exchange or redeem its shares or other evidences of equity.

      (2) When shares are acquired, recalled, exchanged or redeemed by the cooperative, such shares shall be restored to the status of authorized but unissued shares. [1957 c.716 §14; 1993 c.428 §1]

 

      62.240 [Repealed by 1957 c.716 §76]

 

      62.245 Missing certificates or evidence of interest in cooperative; missing records relating to redemption of interest in cooperative. (1) When a certificate of membership in a cooperative or a certificate for a share or shares of membership or capital stock, if certificated, in a cooperative, or other written evidence of the apportionment, distribution and payment of net proceeds or savings of the cooperative, or of any indebtedness or other equity interest in a cooperative, issued by a cooperative is missing, the cooperative shall issue a duplicate thereof upon the request of the owner and upon the furnishing of such indemnity as may be required by the cooperative.

      (2) When records showing ownership of membership in a cooperative or of a share or shares of membership or capital stock in a cooperative, or of the apportionment, distribution and payment of net proceeds or savings of the cooperative, or of any indebtedness or other equity interest in a cooperative, are missing and if the information which is missing is necessary to a proposed redemption of any of the items described in this subsection, the cooperative may give notice and redeem the items as follows:

      (a) The cooperative shall set aside an amount equal to the value of the items to be redeemed.

      (b) The cooperative shall give notice of the redemption to all owners of items of which the cooperative has knowledge.

      (c) If there are items the ownership of which is unknown to the cooperative, it shall publish notice of the redemption at least once a month for four months in a newspaper of general circulation in the county in which the registered office of the cooperative is located.

      (d) After the completion of the publication, any unclaimed outstanding items represented by the missing records may then be terminated in accordance with the provisions of this chapter dealing with unclaimed distributions, redemptions or proceeds. [1957 c.716 §19; 1995 c.195 §6]

 

      62.250 [Repealed by 1957 c.716 §76]

 

      62.255 Meetings of members. (1) Meetings of members may be held either within or without this state as may be provided in the bylaws, and in the absence of a bylaw provision such meetings shall be held at the principal place of business of the cooperative.

      (2) An annual meeting of the members shall be held at such time or within such time as may be provided in the bylaws. If the bylaws do not fix a time for such meeting, the annual meeting shall be held in each calendar year at such time as the board shall determine. Failure to hold the annual meeting at the designated time does not work a forfeiture or dissolution of the cooperative.

      (3) Special member meetings may be called by the president or the board; or the secretary shall call such a meeting upon the filing of a petition stating the business to be brought before the meeting signed by not less than 10 percent of the members of the cooperative.

      (4) Written or printed notice, stating the place, day and hour, and in case of a special member meeting the purposes for which the meeting is called, shall be given to each member and each shareholder, if shareholders are entitled to vote at such meeting, either personally or by mail not less than seven or more than 30 days before the meeting by direction of the person calling the meeting. If mailed, the notice shall be deemed to be given when deposited in the United States mail addressed to the member or shareholder at the address of the member or shareholder as it appears on the records of the cooperative with postage thereon prepaid. At any meeting at which the members are to be represented by delegates, notice to the members may be given by notifying the delegates and their alternates if any.

      (5) A cooperative may provide in its bylaws:

      (a) For the formation of districts and the holding of member meetings by districts and that elections of directors may be held at district meetings.

      (b) That district meetings may elect delegates who shall represent their districts in annual and special meetings of the members. Notice of district meetings shall be given in the same manner as prescribed in this section for member meetings. [1957 c.716 §20]

 

      62.260 [Repealed by 1957 c.716 §76]

 

      62.265 Voting by members. (1) At any member meeting each member has one vote except that bylaws may authorize voting according to actual, estimated or potential patronage, or a combination of such plans of voting. Shares of stock as such shall not be given voting power except in the specific instances authorized by this chapter.

      (2) Members as such shall not vote by proxy; but a member that is a corporation, association or partnership may designate a representative to cast its vote. In the absence of written notice that some person has been designated to represent a member which is other than a natural person, such member may be represented by any of its principal officers. If the bylaws of a cooperative provide for the formation of districts and the election of delegates at district meetings to represent their districts in member meetings, such representation is not considered voting by proxy, and the delegates so elected shall cast the votes to which members represented by them are entitled on such matters as are not covered by mail ballots submitted to all members.

      (3) If the bylaws so provide, the board may cause to be submitted by mail ballot any question to be voted on at any member meeting, including the election of directors. In such event the secretary shall mail to each member along with the notice of the meeting, the ballot on each such question and a voting envelope. The ballot may be cast only in a sealed envelope which is authenticated by the member’s signature. A vote so cast shall be counted as if the member were present and voting in person.

      (4) The bylaws may set forth provisions, not inconsistent with this chapter, relating to the methods and procedures for voting. [1957 c.716 §21]

 

      62.270 [Repealed by 1957 c.716 §76]

 

      62.275 Quorum of members. (1) Those members present at any annual or special member meeting of a cooperative constitute a quorum at the meeting, unless the bylaws of that cooperative provide that a greater number constitutes a quorum.

      (2) Any action taken at a member meeting of a cooperative subsequent to December 31, 1953, and prior to January 1, 1958, which would have been effective except for the absence of a quorum shall be deemed effective in all respects if there were present at such meeting a quorum of members as provided in the bylaws of that cooperative which were in effect at the time of that meeting. [1957 c.716 §22]

 

      62.280 Board of directors. (1) The corporate powers of a cooperative shall be exercised by or under the authority of the board of directors, and the business and affairs of a cooperative shall be managed under the direction of the board of directors. Each director, at all times during the director’s term of office, shall be a member or a representative of a member which is other than a natural person. Unless the bylaws otherwise provide, directors need not be residents of this state. The bylaws may prescribe any other qualifications for directors and may provide that directors be from specified territorial districts. The bylaws may also provide that voting on the election of directors from specified territorial districts may be limited to members from the respective districts without the obligation to hold district meetings.

      (2) The number of directors of a cooperative shall be not less than three, unless the number of members of the cooperative is less than three. If the number of members of the cooperative is less than three, the number of directors shall not be less than the number of members of the cooperative. Subject to this limitation, the number of directors shall be fixed or determined by the bylaws, except as to the number constituting the initial board, which number shall be fixed by the articles.

      (3) Directors constituting the initial board named in the articles shall hold office until the first annual meeting of the members and until their successors are elected and take office. At that meeting and thereafter, directors shall be elected by the members in the manner and for the term of office, not to exceed three years, provided in the bylaws. Each director shall begin immediately to discharge the duties of director and, subject to resignation or removal, shall hold office for the term for which the director was elected and until a successor takes office.

      (4) A director may be removed upon a majority vote of all members voting in person thereon at a duly called member meeting if written reasons for removal of the director are included in the notice of the meeting and the director whose removal is sought has had an opportunity to answer the reasons at the meeting. The written statement of reasons for removal shall be filed with the minutes of the meeting. The bylaws may contain such other provisions for the removal of a director as may be consistent with the provisions of this subsection.

      (5) Unless the bylaws provide otherwise, any vacancy occurring in the board may be filled by the affirmative vote of a majority of the remaining directors though less than a quorum of the board. The director elected to fill a vacancy shall be elected for the unexpired term of the director’s predecessor in office. [1957 c.716 §23; 1981 c.542 §2; 1995 c.195 §7]

 

      62.283 Standard of conduct for directors; permissible reliance on opinions and reports of others; limitation of liability. (1) A director shall discharge the duties of a director, including the duties as a member of a committee, in good faith, with the care an ordinarily prudent person in a like position would exercise under similar circumstances and in a manner the director reasonably believes to be in the best interests of the cooperative.

      (2) In discharging the duties of a director, a director is entitled to rely on information, opinions, reports or statements including financial statements and other financial data, if prepared or presented by:

      (a) One or more officers or employees of the cooperative whom the director reasonably believes to be reliable and competent in the matters presented;

      (b) Legal counsel, public accountants or other persons as to matters the director reasonably believes are within the person’s professional or expert competence; or

      (c) A committee of the board of directors of which the director is not a member if the director reasonably believes the committee merits confidence.

      (3) A director is not acting in good faith if the director has knowledge concerning the matter in question that makes reliance otherwise permitted by subsection (2) of this section unwarranted.

      (4) A director is not liable for any action taken as a director, or any failure to take any action, if the director performed the duties of the director’s office in compliance with this section.

      (5) When evaluating any offer of another party to make a tender or exchange offer for any equity security of the cooperative or any proposal to merge or consolidate the cooperative with another corporation or cooperative or to purchase or otherwise acquire all or substantially all the properties and assets of the corporation or cooperative, the directors of the cooperative may, in determining what they believe to be in the best interests of the cooperative, give due consideration to the social, legal and economic effects on employees, customers and suppliers of the cooperative and on the communities and geographical areas in which the cooperative and its subsidiaries operate, the economy of the state and nation, the long term as well as short term interests of the cooperative and its members, including the possibility that these interests may be best served by the continued independence of the cooperative, and other relevant factors. [1981 c.542 §3; 1995 c.195 §8]

 

      62.284 Director conflict of interest. (1) A conflict of interest transaction is a transaction with the cooperative, other than in the ordinary course of business for which the cooperative is organized, whether or not on a patronage basis, in which a director of the cooperative has a direct or indirect interest. A conflict of interest transaction is not voidable by the cooperative solely because of the director’s interest in the transaction if any one of the following is true:

      (a) The material facts of the transaction and the director’s interest were disclosed or known to the board of directors or a committee of the board of directors, and the board of directors or committee authorized, approved or ratified the transaction;

      (b) The material facts of the transaction and the director’s interest were disclosed or known to the members entitled to vote and they authorized, approved or ratified the transaction; or

      (c) The transaction was fair to the cooperative.

      (2) For purposes of this section, a director of the cooperative has an indirect interest in a transaction if:

      (a) Another entity in which the director has a material financial interest or in which the director is a general partner is a party to the transaction; or

      (b) Another entity of which the director is a director, officer or trustee is a party to the transaction and the transaction is or should be considered by the board of directors of the cooperative.

      (3) For purposes of subsection (1)(a) of this section, a conflict of interest transaction is authorized, approved or ratified if it receives the affirmative vote of a majority of the directors on the board of directors, or on the committee, who have no direct or indirect interest in the transaction. A transaction may not be authorized, approved or ratified under this section by a single director, unless only one director is authorized to serve pursuant to ORS 62.280. If a majority of the directors who have no direct or indirect interest in the transaction vote to authorize, approve or ratify the transaction, a quorum is present for the purpose of taking action under this section. The presence of, or a vote cast by, a director with a direct or indirect interest in the transaction does not affect the validity of any action taken under subsection (1)(a) of this section if the transaction is otherwise authorized, approved or ratified as provided in subsection (1) of this section.

      (4) For purposes of subsection (1)(b) of this section, a conflict of interest transaction is authorized, approved or ratified if it receives the vote of a majority of the member votes entitled to be counted under this subsection. Any director who is a member who has a direct or indirect interest in the transaction, and any votes by a member under the control of an entity described in subsection (2)(a) of this section may be counted in a vote of members to determine whether to authorize, approve or ratify a conflict of interest transaction under subsection (1)(b) of this section. A majority of the members, whether or not present, that are entitled to be counted in a vote on the transaction under this subsection constitutes a quorum for the purpose of taking action under this section. [1995 c.195 §9]

 

      62.285 Meetings of board of directors. (1) Regular or special meetings of the board may be held either within or without this state.

      (2) Regular meetings of the board may be held with or without notice as prescribed in the bylaws. Special meetings of the board shall be held upon such notice as is prescribed in the bylaws. Attendance of a director at a meeting shall constitute a waiver of notice of the meeting except where a director attends a meeting for the express purpose of objecting to the transaction of any business because the meeting is not lawfully called or convened.

      (3) Unless the bylaws provide otherwise, the purposes of any meeting of the board need not be specified in the notice or waiver of notice of the meeting.

      (4) Unless a greater number is required in the bylaws, a majority of the number of directors fixed by or determined pursuant to the bylaws, or in the absence of a bylaw fixing the number of directors, then of the number stated in the articles, shall constitute a quorum for the transaction of business. Unless a greater number is required in the bylaws, an act of the majority of the directors present at a meeting at which a quorum is present is the act of the board. [1957 c.716 §24]

 

      62.286 Loans to or guarantees for directors. (1) Except as provided by subsection (3) of this section, a cooperative may not lend money to or guarantee the obligation of a director of the cooperative unless:

      (a) The particular loan or guarantee is approved by a majority of the votes of all the members excluding the votes of any member who is a benefited director; or

      (b) The cooperative’s board of directors determines that the loan or guarantee benefits the cooperative and either approves the specific loan or guarantee or a general plan authorizing the loans and guarantees.

      (2) The fact that a loan or guarantee is made in violation of this section does not affect the borrower’s liability on the loan.

      (3) This section does not apply to loans and guarantees authorized by statute regulating any special class of cooperatives. [1995 c.195 §10]

 

      62.287 Directors’ meeting by conference telephone or similar communications equipment. Unless otherwise restricted by the articles of incorporation or bylaws of a cooperative, members of the board of directors of a cooperative or any committee designated by the board may hold a meeting of the board or committee by means of conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other. Participation in a meeting pursuant to this section shall constitute presence in person at the meeting. [1981 c.542 §5]

&nb