2018 House Bill 1136 - Printed

State of South Dakota  

681Z0219   HOUSE BILL   NO.  1136  

Introduced by:    Representatives Duvall, Bartling, Chase, Hawley, Lake, Mickelson, Peterson (Kent), Qualm, Reed, Rhoden, and Wismer and Senators Novstrup, Cronin, Frerichs, Heinert, Klumb, Monroe, and Tidemann

        FOR AN ACT ENTITLED, An Act to revise certain provisions related to cooperatives.
    Section 1. That § 47-15-1 be amended to read:
    47-15-1. Terms used in chapters 47-15 to 47-20, inclusive, mean:
            (1)    "Articles," articles of incorporation;
            (2)    "Cooperative," a cooperative corporation which is subject to the provisions of chapters 47-15 to 47-20, inclusive;
            (3)    "Corporation," a corporation which is not a cooperative;
            (4)    "Electronic transmission" or "electronically transmitted," any process of communication not directly involving the physical transfer of paper that is suitable for the retention, retrieval, and reproduction of information by the recipient;
            (5)    "Entity," a domestic and foreign corporation, limited liability company, partnership, cooperative or other legal entity, trust, domestic and foreign unincorporated entity or association, and bodies politic;
            (6)    "Foreign cooperative," a cooperative association organized and operated on a cooperative basis under the laws of any other state, territory, or possession of the United States, or of the District of Columbia or any foreign state, province, or country;
            (7)    "Individual," any natural person;
            (5)(8)    "Member," a person who has been qualified and accepted for membership in a cooperative;
            (6)(9)    "Patron," any person who purchases products or services provided in the normal course of the business of a cooperative. The term "patron" does not include a telecommunications company which purchases any products or services from a telecommunications cooperative or pays any fees or settlements to a telecommunications cooperative, other than local telecommunications services; and
            (7)(10)    "Person," includes individuals, firms, partnerships, limited liability companies, unincorporated associations, cooperatives, corporations, and bodies politic an entity or individual entity.
    Section 2. That § 47-15-3 be amended to read:
    47-15-3. Three or more natural persons individuals of legal age, one of whom must be a resident, may form a cooperative by signing, acknowledging, filing, and recording articles of incorporation.
    Section 3. That § 47-15-47 be amended to read:
    47-15-47. Whenever If notice is required by chapters 47-15 to 47-20, inclusive, to be given to any person, such the notice shall be given either personally or, by mail, or electronic transmission. If mailed, such the notice is given when deposited in the United States mail, with postage prepaid thereon, addressed to such person at his the person's address as it appears on

the records of the cooperative. If electronically transmitted, the notice is given when sent.

    A signed waiver is equivalent to personal notice to the person so signing.
    Section 4. That § 47-16-10 be amended to read:
    47-16-10. At any member meeting of a cooperative composed of individual members and member cooperative corporations entity members, each such individual member or corporate entity member shall be is entitled to only one vote.
    Section 5. That § 47-16-14 be amended to read:
    47-16-14. An absent member of a cooperative may submit a signed vote by mail or electronic means if he the member has been previously notified in writing of the exact motion or resolution upon which the vote is taken. The bylaws may limit use of signed votes.
    Section 6. That § 47-16-15 be amended to read:
    47-16-15. In the absence of written notice that some a person has been designated to represent a an entity member of a cooperativewho is other than a natural person, such, the member may be represented by any of its principal officers. Unless the bylaws provide otherwise, an individual may represent more than one such entity member, and may also vote as an individual if he the individual is a member.
    Section 7. That § 47-16-56 be amended to read:
    47-16-56. If the names and post office addresses of the person or persons name and address of any person entitled to receive the money or property mentioned in § 47-16-54 are is shown upon on the records of the cooperative, or are known to the secretary thereof and the money or property is of the value of fifty dollars or more, a notice shall be mailed or electronically transmitted to such each person or persons at their the last known post office addresses, which address. The notice shall describe the money or property referred to, state the name of the each person or persons who appear who appears to be entitled thereto to money or property as shown

by the records of the cooperative, and state that said the money or property will be forfeited to the cooperative six months from the date the notice is mailed or electronically transmitted unless said the money or property is claimed and proper evidence of ownership is submitted within that time; the. The notice shall be dated and signed and mailed or electronically transmitted on behalf of the cooperative by its secretary or any other duly authorized person individual.
    Section 8. That § 47-17-1 be amended to read:
    47-17-1. The business and affairs of a cooperative shall be managed by a board of directors. Every Each director shall be a member or a representative of a member who is other than a natural person an entity member. The bylaws shall prescribe any other qualifications for directors and may provide that directors be from specified territorial districts.
    Section 9. That § 47-17-10 be amended to read:
    47-17-10. A signed waiver of notice of a meeting of the board of directors of a cooperative is equivalent to personal notice to the person so individual signing the waiver. Attendance at a meeting is a waiver of notice of such the meeting, except when a director attends the meeting and objects thereat to the transaction of business because the meeting was not lawfully convened.
    Section 10. That § 47-17-14 be amended to read:
    47-17-14. The principal officers of a cooperative are a president, one or more vice-presidents as prescribed in the bylaws, a secretary, and a treasurer. They The principal officers shall be elected annually by the board of directors at such a time and in such manner as pursuant to the bylaws provide. Each principal officer except the secretary and the treasurer must shall be a director of the cooperative. The offices of secretary and treasurer may be combined in one person individual.
    Section 11. That § 47-20-4 be amended to read:

    47-20-4. Within nine months after the close of its fiscal year, each cooperative organized under chapters 47-15 to 47-20, inclusive, shall mail or electronically transmit to each of its stockholders or members, at their the stockholder's or member's last known post office addresses address, a financial report signed by a principal officer, managing agent, or a public accountant, showing its assets and liabilities and proceeds or loss for the preceding fiscal year.

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