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54201-54204

FOOD AND AGRICULTURAL CODE
SECTION 54201-54204

54201.  An association is not subject in any manner to the terms of
the Corporate Securities Law, Division 1 (commencing with Section
25000), Title 4 of the Corporations Code, and any association may
issue its membership certificates or stock or other securities as
provided in this chapter without the necessity of any qualification
under that law.



54202.  If an association issues nonpar value stock, the issuance of
such stock shall be governed by the terms of all general laws which
cover the issuance of nonpar value stock in domestic corporations.



54203.  If an association with preferred shares of stock purchases
the stock or any property, or any interest in any property of any
person, it may discharge the obligations which are so incurred,
wholly or in part, by exchanging for the acquired interest, shares of
its preferred stock to an amount which at par value would equal the
fair market value of the stock or interest so purchased, as
determined by the board of directors. In that case the transfer to
the association of the stock or interest which is purchased is
equivalent to payment in cash for the shares of stock which are
issued.



54204.  The board of directors of every association shall cause to
be sent to the members of the association not later than 120 days
after the close of the fiscal or calendar year an annual report of
the operations of the association, unless such report is expressly
dispensed with in the bylaws.
   If required by the bylaws, interim reports of the operations of
the association for the three month, six month, or nine month periods
of the current fiscal year of the association shall be furnished to
the members of the association.
   Such annual report and any such interim reports shall include a
balance sheet as of such closing date. Such financial statement shall
be prepared from, and be in accordance with, the books. It shall be
prepared in a form which is sanctioned by sound accounting practice
for the association or approved by a duly certified public accountant
or a public accountant.