10.1 - DEFINITIONS.
10.1 DEFINITIONS.
As used in this chapter and in chapter 10B, unless the context
otherwise requires:
1. "Actively engaged in farming" means that a natural person,
including a shareholder or an officer, director, or employee of a
corporation, or a member or manager of a limited liability company,
does any of the following:
a. Inspects the production activities periodically and
furnishes at least half of the value of the tools used for crop or
livestock production and pays at least half the direct cost of crop
or livestock production.
b. Regularly and frequently makes or takes an important part
in making management decisions substantially contributing to or
affecting the success of the farm operation.
c. Performs physical work which significantly contributes to
crop or livestock production.
2. "Agricultural land" means the same as defined in section
9H.1.
3. "Authorized entity" means an authorized farm corporation;
authorized limited liability company; limited partnership, other than
a family farm limited partnership; or an authorized trust as defined
in section 9H.1.
4. "Commodity share landlord" means a natural person or a
general partnership as provided in chapter 486A in which all partners
are natural persons, who owns at least one hundred fifty acres of
agricultural land, if the owner receives rent on a commodity share
basis, which may be either a share of the crops or livestock produced
on the land.
5. "Cooperative association" means an entity which is
structured and operated on a cooperative basis pursuant to 26 U.S.C.
§ 1381(a) and which meets the definitional requirements of an
association as provided in 12 U.S.C. § 1141(j)(a) or 7 U.S.C. § 291.
6. "Family farm entity" means a family farm corporation,
family farm limited liability company, family farm limited
partnership, or family trust, as defined in section 9H.1.
7. "Farm estate" means the real and personal property of a
decedent, a ward, or a trust as provided in chapters 633 and 633A, if
at least sixty percent of the gross receipts from the estate comes
from farming.
8. "Farmers cooperative association" means a cooperative
association organized under chapter 490 or 499, if all of the
following conditions are satisfied:
a. All of the following apply:
(1) Qualified farmers must hold at least a fifty-one percent
equity interest in the cooperative association, including fifty-one
percent of each class of members' equity.
(2) The following persons must hold at least a seventy percent
equity interest in the cooperative association, including seventy
percent of each class of members' equity:
(a) A qualified farmer.
(b) A family farm entity.
(c) A commodity share landlord.
b. As used in this subsection, "members' equity" includes
but is not limited to issued shares, including common stock or
preferred stock, regardless of a right to receive dividends or
earning distributions. However, "members' equity" does not
include nonvoting common stock or nonvoting membership interests. A
security such as a warrant or option that may be converted to voting
stock shall be considered as issued shares.
c. For purposes of this subsection, a person who was a
qualified person within the last ten years shall be treated as a
qualified person.
9. "Farmers cooperative limited liability company" means a
limited liability company organized under chapter 489 or 490A, if
cooperative associations hold one hundred percent of all membership
interests in the limited liability company. Farmers cooperative
associations must hold at least seventy percent of all membership
interests in the limited liability company. If more than one type of
membership interest is established, including any series as provided
in section 489.1201 or 490A.305 or any class or group as provided in
section 489.1201 or 490A.307, farmers cooperative associations must
hold at least seventy percent of all membership interests of each
type.
10. "Farmers entity" means a networking farmers entity,
farmers cooperative limited liability company, or farmers cooperative
association.
11. "Farming" means the same as defined in section 9H.1.
12. "Grain" means the same as defined in section 203.1.
13. "Intra-company loan agreement" means an agreement
involving a loan, if the parties to the agreement are members of the
same farmers cooperative limited liability company, and according to
the terms of the loan a member which is a regional cooperative
association directly or indirectly loans money to a member which is a
farmers cooperative association, on condition that the money,
including any interest, must be repaid by the member which is a
farmers cooperative association to the regional cooperative
association or another person. A loan agreement does not include an
operating loan agreement, in which all of the following apply:
a. The money is required to be repaid within ninety days from
the date that the farmers cooperative association receives the money,
and the money is actually repaid by that date.
b. The money is used to pay for reasonable and ordinary
expenses of the farmers cooperative association in conducting its
affairs.
14. "Livestock" means an animal belonging to the bovine,
caprine, equine, ovine, or porcine species, ostriches, rheas, emus,
farm deer as defined in section 170.1, or poultry.
15. "Networking farmers corporation" means a corporation,
other than a family farm corporation as defined in section 9H.1,
organized under chapter 490 if all of the following conditions are
satisfied:
a. All of the following apply:
(1) Qualified farmers must hold at least fifty-one percent of all
issued shares of the corporation. If more than one class of shares
is authorized, qualified farmers must hold at least fifty-one percent
of all issued shares in each class.
(2) Qualified persons must hold at least seventy percent of all
issued shares of the corporation. If more than one class of shares
is authorized, qualified persons must hold at least seventy percent
of all issued shares in each class.
b. As used in paragraph "a", "issued shares" includes
but is not limited to common stock or preferred stock, or each class
of common stock or preferred stock, regardless of voting rights or a
right to receive dividends or earning distributions. A security such
as a warrant or option that may be converted to stock shall be
considered as issued shares.
16. "Networking farmers entity" means a networking farmers
corporation or networking farmers limited liability company.
17. "Networking farmers limited liability company" means a
limited liability company, other than a family farm limited liability
company as defined in section 9H.1, organized under chapter 489 or
490A if all of the following conditions are satisfied:
a. Qualified farmers must hold at least fifty-one percent of
all membership interests in the limited liability company. If more
than one type of membership interest is established, including any
series as provided in section 489.1201 or 490A.305 or any class or
group as provided in section 489.1201 or 490A.307, qualified farmers
must hold at least fifty-one percent of all membership interests of
each type.
b. Qualified persons must hold at least seventy percent of
all membership interests in the limited liability company. If more
than one type of membership interest is established, including any
series as provided in section 489.1201 or 490A.305 or any class or
group as provided in section 489.1201 or 490A.307, qualified persons
must hold at least seventy percent of all membership interests of
each type.
18. "Operation of law" means a transfer by inheritance,
devise, or bequest, court order, dissolution decree, order in
bankruptcy, insolvency, replevin, foreclosure, execution sale, the
execution of a judgment, the foreclosure of a real estate mortgage,
the forfeiture of a real estate contract, or a transfer resulting
from a decree for specific performance.
19. "Qualified farmer" means any of the following:
a. A natural person actively engaged in farming.
b. A general partnership as provided in chapter 486A in which
all partners are natural persons actively engaged in farming.
c. A farm estate.
20. "Qualified commodity share landlord" means a commodity
share landlord, if the owner of the agricultural land was actively
engaged in farming the land or a family member of the owner is or was
actively engaged in farming the land, if the family member is related
to the owner as a spouse, parent, grandparent, lineal ascendant of a
grandparent or spouse, or other lineal descendant of a grandparent or
spouse.
21. "Qualified person" means a person who is any of the
following:
a. A qualified farmer.
b. A family farm entity.
c. A qualified commodity share landlord.
22. "Regional cooperative association" means a cooperative
association other than a farmers cooperative association. Section History: Recent Form
98 Acts, ch 1110, §101, 301; 2002 Acts, ch 1119, §114, 115; 2003
Acts, ch 149, §1, 23; 2005 Acts, ch 38, § 55; 2008 Acts, ch 1162,
§125, 126, 155; 2009 Acts, ch 133, §4
Referred to in § 10B.1, 10D.1, 15.104, 15E.202, 202B.102, 502.102
Footnotes
For future amendments to subsections 9 and 17 effective December
31, 2010, see 2008 Acts, ch 1162, § 154, 155