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tion to another, except by an affirmative vote of not less than three fourths of the said board of trustees of the new corporation, nor divert specific grants, donations, or bequests from the purposes for which such grants, donations, or bequests were made. That after the boards of trustees have conveyed the property, real and personal, of the various institutions to the new corporation, as hereinabove provided, and the same has been accepted by the said new corporation, then the franchises held by the corporations thus consolidating shall cease, and the said corporations shall be thereby dissolved.

Amended March 9, 1895; stats. 1895, p. 40.

TITLE XIX.

[Title XIX added March 21, 1905; stats. 1905, p. 594.]

Co-operative Business Corporations.

SEC. 653a. Purposes for which may be formed.

Purposes for which may be formed.

§ 653a. Coöperative business corporations may be formed for doing any lawful business, and dividing a portion of their profits among persons other than their stockholders. Each of such corporations may, in its by-laws, in addition to the matters specified in section three hundred and three, provide the amount of profits which must be divided among persons other than its stockholders, and the manner in which and the persons among whom such division may be made.

Enacted March 21, 1905; stats. 1905, p. 594.

NOTE.- 653a. This section is a codification of that part of the statute of 1877-8, page 883, defining co-operative corporations, and the section is placed in a new title designated "Co-operative Business Corporations." That part of the statute declaring that the by-laws may provide for the number of votes to which each shareholder shall be entitled is omitted for the reason that it is special legislation, and probably unconstitutional within the decision in Krause vs. Durbrow, 127 Cal. 681.

TITLE XX.

[Title XX added March 21, 1905; stats. 1905, p. 595.]

SEC. 653b.

653c.

653d.

653e.

653f.

653g.

653h.

Co-operative Business Associations.

Formation and purposes of.

Rights, interests, and liabilities of members.
The articles of association.

The by-laws.

Execution against the association or its members.
Purposes of the association, how may be altered.
Powers of the association.

653i. · Consolidation of associations.

653j.
653k.

6531.

Dissolution and winding up of association.

Quo warranto to inquire into the right of an association to do business.

What corporations or associations are not affected by this title.

Formation and purposes of.

§ 6536. Five or more persons may form a coöperative association for the transaction of any lawful business, whether for profit or not, or for the promotion of any educational, industrial, benevolent, social, or political purpose. Such association must not have any capital stock, but must issue membership certificates to each member. Such certificate can not be assigned, so that the assignee can, by its transfer, become a member of the association, but, by a resolution of its board of directors, such certificate may be transferred, and the transferee made a member in lieu of the last former holder.

Enacted March 21, 1905; stats. 1905, p. 595.

NOTE. §§ 653b, 653c, 653d, 653e, 653f, 653g, 653h, 653i, 653j, 653k, 6531. The statute of 1895, page 221, is codified in the above sections, which are placed in a title designated "Co-operative Business Associations."

Rights, interests, and liabilities of members.

§ 653c. In such association the rights and interests of all members are equal, and no member can have or acquire a greater interest therein than any other member has. At every election held pursuant to the by-laws each member must be entitled to cast one vote and no more. All persons above the age of eighteen years, regardless of sex, are eligible to membership, if

otherwise qualified and elected as the by-laws may provide. The by-laws must provide for the amount of the indebtedness which such association may incur. And no member shall be responsible individually, or personally liable, for any of the debts or liabilities of the association in excess of his proportion of such indebtedness; but in case of the failure and insolvency of such association, may be required to pay any unpaid dues or installments which have, before such insolvency, become due from such member to the association, pursuant to its by-laws. Enacted March 21, 1905; stats. 1905, p. 595.

NOTE. See note to § 653b.

The articles of association.

§ 653d. Every association formed under this title must prepare articles of association, in writing, stating: The name of the association, the purpose for which it is formed, the place where its principal business is to be transacted, the term for which it is to exist, not to exceed fifty years, the number of the directors thereof, and the names and residences of those selected for the first year, the amount which each member is to pay upon admission as membership fee, and that each member signing the articles has actually paid in such sum, and that the interest and right of each member therein is to be equal. Such articles of association must be subscribed by the original associates or members, and acknowledged by each before some person competent to take an acknowledgment of a deed in this state. Such articles so subscribed and acknowledged must be filed in the office of the clerk of the county wherein the principal business of the association is to be transacted, and a copy thereof certified by such clerk, with the secretary of state, who must thereupon issue his certificate in the form, and having the effect prescribed in section two hundred and ninety-six. Enacted March 21, 1905; stats. 1905, p. 595.

NOTE. See note to § 653b.

The by-laws.

§ 653e. Every association formed under this title must, within forty days after it so becomes an association, adopt a code of by-laws for the government and management of the association, not inconsistent with this title. A majority of all the associates is necessary to the adoption of such by-laws, and the same must be written in a book, and subscribed by the

members adopting the same, and the same cannot be amended or modified except by the vote of a majority of all the members, after notice of the proposed amendment, given as the by-laws may provide. Such association may, by its by-laws, provide for the time, place, and manner of calling and conducting its meetings; the number of directors, the time of their election, their term of office, the mode and manner of their removal, the mode and manner of filling vacancies in the board caused by death, resignation, removal, or otherwise, and the power and authority of such directors, and how many thereof are necessary to the exercise of the powers of such directors, which must be at least a majority; the compensation of any of the directors, or of any officer; the number of the officers, if any, other than the directors, and their term of office; the mode of removal, and the method of filling a vacancy; the mode and manner of conducting business; the mode and manner of conducting elections, and may provide for voting by ballots forwarded by mail or otherwise, provided the method secures the secrecy of the ballot; the mode and manner of succession of membership, and the qualifications for membership, and on what conditions, and when membership must cease, and the mode and manner of expulsion of a member, subject to the right of an expelled member to have the board of directors appraise his interest in the association in either money, property, or labor, as the directors may deem best, and to have the money, property, or labor so awarded him paid, or delivered, or performed within forty days after expulsion; the amount of membership fee, and the dues, installments, or labor which each member must be required to pay or perform, if any, and the manner of collection or enforcement, and for forfeiting or selling of membership interest for non-payment or non-performance; the method, time, and manner of permitting the withdrawal of a member, if at all, and how his interest must be ascertained, either in money or property, and within what time the same must be paid or delivered to such member; the mode and manner of ascertaining the interest of a member at his death, if his legal representatives or none of them desire to succeed to the membership, and whether the same must be paid to his legal representatives in `money. or property, or labor, and within what time the same must be paid, or delivered, or performed; such other things as may be proper to carry out the purpose for which the association was

formed. The by-laws must provide for the time and manner in which profits must be divided among the members, and what proportion of the profits, if any, must be added to the common property or funds of the association. But the by-laws may provide that the directors may suspend or pass the payment of any such profit, or installment of earnings, at their discretion. The by-laws and all amendments must be recorded in a book and kept in the office of the association, and a copy, certified by the directors, must be filed in the office of the county clerk where the principal business is transacted.

Enacted March 21, 1905; stats. 1905, p. 596.
NOTE. See note to § 653b.

Execution against the association or its members.

§ 653f. The property of such association is subject to attachment and execution for its lawful debts. The interest of a member in such association, if sold upon execution, or any judicial or governmental order whatever, can not authorize the purchaser to have any right, except to succeed, as a member in the association, with the consent of the directors, to the rights of the member whose interest is thus sold. If the directors choose to pay or settle the matter after such sale, they may either cancel the membership, and add the interest thus sold to the assets or common property of the association, or reissue the share or right to a new member upon proper payment therefor, as the directors may determine.

Enacted March 21, 1905; stats. 1905, p. 597.
NOTE. See note to § 653b.

Purposes of the association, how may be altered.

§ 653g. The purpose of the business may be altered, changed, modified, enlarged, or diminished by a vote of two thirds of all the members, at a special election to be called for such purpose, of which notice must be given the same as the by-laws provide for the election of directors.

Enacted March 21, 1905; stats. 1905, p. 597.
NOTE. See note to § 653b.

Powers of the association.

§ 653h. Every association formed under this title has power of succession by its associate name for fifty years; in such name to sue and be sued in any court; to make and use a common seal, and alter the same at pleasure; to receive by gift,

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