35-19-312. Disposition or encumbrance of property.
35-19-312. Disposition or encumbrance of property. (1) Except as provided in subsection (2), or other than as arises relating to the issuance of stock or for any sale, mortgage, lease, transfer, or other disposition or encumbrance of property to any entity owned or controlled by the buying cooperative or in which the buying cooperative holds a majority interest or for any disposition or encumbrance arising from or in connection with the issuance of shares of stock, if any is authorized, a buying cooperative may not sell, mortgage, lease, or otherwise dispose of or encumber all or any substantial portion of its property unless the sale, mortgage, lease, or other disposition or encumbrance is authorized at a duly held meeting of members of the buying cooperative by an affirmative vote of not less than two-thirds of all the members of the buying cooperative and unless the notice of the proposed sale, mortgage, lease, or other disposition or encumbrance is contained in the notice of the meeting.
(2) The board of trustees of a buying cooperative, without authorization by the members of the buying cooperative, has the full power and authority to authorize the execution and delivery of a mortgage or mortgages or a deed or deeds of trust upon or the pledging or encumbrancing of any or all of the property, assets, rights, privileges, licenses, franchises, and permits of the buying cooperative, whether acquired or to be acquired and wherever situated, as well as the revenue and income from the property, assets, rights, privileges, licenses, franchises, and permits of the buying cooperative, all upon the terms and conditions that the board of trustees determines, to secure any indebtedness of the buying cooperative or any entity owned or controlled by the buying cooperative or in which the buying cooperative owns a majority interest to the United States or any instrumentality or agency of the United States or to any other financing sources within the United States.
(3) Before a meeting is held to vote on authorization of disposition of buying cooperative property as provided in subsection (1), the board of trustees shall:
(a) have the property appraised by three appraisers chosen by the board and not associated with the buying cooperative or a proposed buyer of buying cooperative property;
(b) notify all buying cooperative members, at least 90 days in advance, of a meeting to vote on disposition of buying cooperative property. Detailed proposals for disposition of the property must accompany the notice; and
(c) at least 30 days before the meeting, mail to all members any alternative proposal made by buying cooperative members if it has been submitted to the board and signed by 50 or more members.
(4) The vote on property disposition may take place at an annual meeting if the board notifies the members as provided in this section.
History: En. Sec. 24, Ch. 575, L. 1999.