Class B conversion

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Current Wording

(Rule 21)

  1. Membership shares: (no change)
  2. Class A shares: (see see current wording)
  3. Class B shares:
    1. have a par value of $1 per share;
    2. may be issued by the directors to members or non-members:
      1. in exchange for tangible capital goods at fair market price, or
      2. in exchange for labor personally executed by a member on a capital project;
  4. may not be held jointly;
  5. do not bear interest nor dividend;
  6. may be subject to a negative stock split from time to time at a rate set by the directors, as the capital goods backing these shares age and depreciate;
  7. may be transferred with the approval of the Directors;
  8. can only be redeemed upon termination of membership or special resolution, at par value;
  9. upon dissolution, will be redeemed after Class A investment shares, but prior to redemption of membership shares;
  10. at no time shall the number of Class B investment shares issued to non-members exceed 50% of the total number of Class B investment shares.

New Wording

(Rule 21)

  1. Membership shares: (no change)
  2. Class A shares: (see see proposed wording)
  3. Class B shares:
    1. have a par value of $1 per share;
    2. may be issued by the directors to members or non-members:
      1. in exchange for tangible capital goods at fair market price, or
      2. in exchange for labor personally executed by a member or non-member on a capital project;
  4. may be held jointly;
  5. do not bear interest or dividend;
  6. may be subject to a negative stock split from time to time at a rate set by the directors, as the capital goods backing these shares age and depreciate;
  7. may be transferred with the approval of the Directors;
  8. cannot be redeemed;
  9. Class B Investment Shares are immediately and involuntarily converted, at par value, to Class A Investment Shares upon any of the following conditions, and before any distribution of any share redemptions in any class or classes of shares begins:
    1. Upon transfer of over half the Class A Investment Shares to a new party who has not held Class A Investment Shares in the past twelve months,
    2. Upon voluntary or involuntary liquidation of over half the assets of the co-op, or
    3. Upon voluntary or involuntary dissolution of the co-op.
  10. at no time shall the number of Class B investment shares issued to non-members exceed 50% of the total number of Class B investment shares.

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