Cooperative corporations.

Existing law, the Consumer Cooperative Corporation Law, provides for the organization and operation of primarily consumer cooperatives, and is also applicable to other cooperatives. Existing law provides for, among other things, information to be included in a corporation's bylaws, definitions necessary for purposes of defining patrons, and requirements as to voting rights of members and time periods for sending notice of meetings at which members are entitled to vote. This bill would rename the law as the Cooperative Corporation Law, and provide alternative provisions to which a cooperative corporation may elect to be subject by designating itself as a worker cooperative in its bylaws. This bill would limit a member of a worker cooperative to only one vote on a matter to be voted on by all classes voting together as a single class, regardless of the number of voting classes in which the person is a member. The bill would also require notice of a meeting in which members of a worker cooperative are entitled to vote to be sent no more than 24 hours before the time of the meeting. The bill would also make conforming changes. Existing law provides that members may elect a director at any time to fill a vacancy. Existing law requires a cooperative corporation to include in its name the word "cooperative." Existing law provides that a member may not transfer a membership, unless authorized under the cooperative corporation's articles or bylaws. This bill would provide that, in the case of a corporation with no members, the board may fill the vacancy and would specify the manners in which vacancies may be filled by the sole remaining director or by directors then in office when that number is less than a quorum. The bill would require a worker cooperative corporation to include in its name the words "worker cooperative." The bill would provide that a membership in a worker cooperative corporation is nontransferable. Existing law limits a distribution by a cooperative corporation in any fiscal year to 15%, multiplied by contributions to capital. Under existing law, the board of a cooperative corporation may abandon a merger, at any time before the merger is effective, as specified. Existing law requires a cooperative corporation to prepare an annual report not later than 120 days after the close of the corporation's fiscal year. This bill would exclude distributions by a worker cooperative corporation from the distribution limit. The bill would prohibit the board of a worker cooperative corporation from abandoning a merger. The bill would require a worker cooperative corporation to prepare an annual report not later than 360 days after the close of the corporation's fiscal year. Violation of specified provisions of the existing law is a crime. Because this bill would expand existing crimes, this bill would create a state-mandated local program. The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement. This bill would provide that no reimbursement is required by this act for a specified reason.