Bylaws for High Five Co-op Brewery, Inc. Table of Contents Table of Contents Section 1 High Five Co-op Brewery Values and Principles....................6 1.1 Cooperative Values and Principles....................................6 1.1.1 Definition.........................................................6 1.1.2 Values.............................................................6 1.1.3 Principles.........................................................6 1.2 Additional Principles................................................7 1.2.1 Participatory Self-Management......................................7 1.2.2 Living Wage.....................................................8 1.2.3 Sustainability.....................................................8 1.2.4 Privacy............................................................8 1.2.5 Responsible Consumption of Alcohol.................................8 Section 2 Definitions........................................................8 Section 3 .................................................... Membership 10 3.1 Membership Qualifications...........................................10 3.2 Membership Fee and Certificate......................................11 3.3 Initiation..........................................................11 3.4 Individual Members..................................................11 3.4.1 ................................... Classes of Individual Members 11 3.5 Inactivation of Membership..........................................11 Page 1 of 60
Transcript
Bylaws for High Five Co-op Brewery, Inc.
Table of Contents
Table of ContentsSection 1 High Five Co-op Brewery Values and Principles...................................................................................6
1.1 Cooperative Values and Principles................................................................................................................6
1.2.2 Living Wage................................................................................................................................................8
3.4.1 Classes of Individual Members...............................................................................................................11
3.5 Inactivation of Membership........................................................................................................................11
3.6 Termination of Membership........................................................................................................................12
4.3 Regular and Annual Member Meeting........................................................................................................13
4.3.1 Notice of Members’ Assembly................................................................................................................14
4.3.2 Making and Certifying List of Members Entitled to Vote at Meeting....................................................14
4.3.3 Quorum of Members...............................................................................................................................15
4.3.4 Special Meetings of Members................................................................................................................16
4.3.7 Notice for Voting in a Referendum.........................................................................................................17
4.3.8 Electronic Member Participation in Meetings........................................................................................18
Section 5 Board of Directors...................................................................................................................................19
5.1 Definition of Board of Directors................................................................................................................19
5.2 Powers & Duties of the Board.....................................................................................................................19
5.2.1 General Manager and Operations Manager.................................................................................................19
5.3 Eligibility for Board Service.......................................................................................................................19
5.5 Terms of Board Service...............................................................................................................................20
5.6 Election & Removal of Board Members.....................................................................................................20
5.6.1 Election of Board Members....................................................................................................................20
5.6.2 Removal of Board Members...................................................................................................................20
5.7 Officers of the Board...................................................................................................................................21
5.8.1 Organizational Meeting of Board............................................................................................................22
5.8.2 Regular Meetings of the Board...............................................................................................................22
5.8.3 Special Meetings of the Board................................................................................................................22
5.8.4 Notice of Board Meetings.......................................................................................................................22
Section 6 Workers’ Assembly and Board Staff Members.......................................................................................25
6. 1 Related Definitions......................................................................................................................................25
6.2. Front of the House Assembly......................................................................................................................26
6.2.1 Workers Included in Front of the House Assembly................................................................................26
6.2.2 Front of House Assembly Powers and Duties.........................................................................................26
6.2.3 Front of the House Volunteers................................................................................................................26
6.2.4 Front of House Board-Staff Member......................................................................................................27
6.3 Back of the House Assembly......................................................................................................................27
6.3.1 Workers Included in the Back of the House Assembly..........................................................................27
6.3.2 Back of House Assembly Members: Powers and Duties........................................................................27
6.3.3 Back of the House Volunteers.................................................................................................................27
6.3.4 Back of House Board-Staff Member......................................................................................................27
6.4 Board Staff Members Service—Both Front and Back of House................................................................27
6.4.1 Term of Service for Board Staff.............................................................................................................28
6.4.2 Recall of Board Staff..............................................................................................................................28
Section 7 Capital Accounts....................................................................................................................................28
7.1 Member Capital Accounts...........................................................................................................................28
7.2 Patronage Allocation to Member Capital Accounts....................................................................................28
7.4.1 Bond Eligibility.......................................................................................................................................29
7.4.2 Terms of Bond.........................................................................................................................................29
7.5 Transfer to Estate Upon Death of Holder....................................................................................................29
7.6 Redemption of Member Capital and Termination of Membership.............................................................30
7.6.1 Terms of Redemption of Member Capital..............................................................................................30
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7.6.2 Partial Redemption of Member Capital..............................................................................................30
7.6.3 Circumstances of Non-Redemption of Member Capital........................................................................30
7.6.4 Termination of Membership...............................................................................................................30
7.6.5 Notice of Entitlement to Redemption.................................................................................................31
7.6.6 Special Circumstances............................................................................................................................31
Section 8 Net Savings, Determination, Allocation, Apportionment of Losses......................................................31
8.1 Allocation of Net Savings...........................................................................................................................32
8.1.2 Capital Accounts.....................................................................................................................................32
8.1.3 Improved Member Services....................................................................................................................32
8.2 Allocation of Net Losses.............................................................................................................................32
Section 9 Certificates of Membership and Investment...........................................................................................32
Section 10 Restriction on Payment of Dividends.....................................................................................................33
Section 11 Dissolution and Distribution of Assets...................................................................................................34
11.2.1 Payment of Liabilities upon Dissolution............................................................................................34
11.2.2 Return of Assets Held Under Condition.............................................................................................34
11.2.3 Return of Charitable Assets Not Held Under Condition....................................................................34
11.2.4 Distribution of Assets to Cooperative Members, Investors and Patrons............................................35
11.2.5 Distribution of Assets as Planned by the Cooperative..........................................................................35
11.2.6 Distribution of Assets without Governing Provisions........................................................................35
11.3 Special Meeting to Dissolve the Cooperative.............................................................................................36
11.4 Special Vote to Dissolve the Cooperative...................................................................................................36
11.5 Certificate of Dissolution...........................................................................................................................36
Section 12 Effects of Amendments to Articles and Bylaws on Legal Sale of Co-op Assets...................................36
12.1 Ownership Rights under Execution or in the Course of Bankruptcy..........................................................36
12.2 Certificate Pledges Not Subject to Amendment to Bylaws or Articles.......................................................37
Section 13 Indemnification and Insurance................................................................................................................37
13.1 Scope of Indemnification............................................................................................................................37
13.2 Authorization of Indemnification...............................................................................................................38
13.3 Advancing of Expenses Related to Suits and Actions.................................................................................38
Section 14 Adoption and Amendment......................................................................................................................38
14.1 Bylaws Adoption and Amendment..............................................................................................................38
14.2 Adoption and Amendment of the Articles of Incorporation........................................................................39
15.4 Democratic Rules of 0rder..........................................................................................................................40
15.5 Books and Records, Mailings, Contact Between Members Regarding Proposals......................................40
15.5.1 Written Accounting Records and Reports..........................................................................................40
15.5.2 Year End Closing of Accounts............................................................................................................41
15.5.3 Presentation of Reports to Membership.............................................................................................41
15.5.4 Regarding Use of Membership Lists by Members.............................................................................41
15.5.5 Facilitation of Communication between Members...........................................................................41
15.6 Affiliation with Other Organizations Involving Cooperative Assets..........................................................42
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Bylaws for High Five Co-op Brewery, Inc.
Section 1 High Five Co-op Brewery Values and Principles
1.1 Cooperative Values and Principles High Five Co-op Brewery, Inc. (“the Cooperative” or “Co-op”) subscribes to the Statement on Cooperative Identity adopted by the Congress and General Assembly of the International Cooperative Alliance held in Manchester, England in 1995. The full text of the statement is given below.
1.1.1 Definition
A cooperative is an autonomous association of persons united voluntarily to meet their common economic, social, and cultural needs and aspirations through a jointly-owned and democratically- controlled enterprise.
1.1.2 Values
Cooperatives are based on the values of self-help, self-responsibility, democracy, equality, equity and solidarity. In the tradition of their founders, cooperative members believe in the ethical values of honesty, openness, social responsibility and caring for others.
1.1.3 Principles
1.1.3.1 Voluntary and Open Membership Cooperatives are voluntary organizations, open to all persons able to use their services and willing to accept the responsibilities of membership, without gender, sexual orientation, gender identity and gender expression, social, racial, political or religious discrimination.
1.1.3.2 Democratic Member ControlCooperatives are democratic organizations controlled by their members, who actively participate in setting their policies and making decisions. Individuals serving as elected representatives are accountable to the membership. In primary cooperatives members have equal voting rights (one member, one vote) and cooperatives at other levels are also organized in a democratic manner.
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1.1.3.3 Member Economic ParticipationMembers contribute equitably to, and democratically control, the capital of their cooperative. At least part of that capital is usually the common property of the cooperative. Members usually receive limited compensation, if any, on capital subscribed as a condition of membership. Members allocate surpluses for any or all of the following purposes: developing their cooperative, possibly by setting up reserves, part of which at least would be indivisible; benefiting members in proportion to their transactions with the cooperative; and supporting other activities approved by the membership.
1.1.3.4 Autonomy and IndependenceCooperatives are autonomous, self-help organizations controlled by their members. If they enter into agreements with other organizations, including governments, or raise capital from external sources, they do so on terms that ensure democratic control by their members and maintain their cooperative autonomy.
1.1.3.5 Education, Training and InformationCooperatives provide education and training for their members, elected representatives, managers, and employees so they can contribute effectively to the development of their cooperatives. They inform the general public - particularly young people and opinion leaders - about the nature and benefits of cooperation.
1.1.3.6 Cooperation among CooperativesCooperatives serve their members most effectively and strengthen the cooperative movement by working together through local, national, regional and international structures.
1.1.3.7 Concern for CommunityCooperatives work for the sustainable development of their communities through policies approved by their members.
1.2 Additional Principles
The Co-op subscribes to the following additional principles:
1.2.1 Participatory Self-Management
The Co-op aspires to achieve a fair and just outcome through decision-making in accord
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with participatory self-management. The Co-op’s Participatory Self-Management system will be articulated in the Co-op’s Operating Rules.
1.2.2 Living Wage
When financially able as determined by the Board of Directors (“the Board”), the Co-op shall pay no less than a living wage (determined by the formula of the Universal Living Wage Campaign) to any of its employees.
1.2.3 Sustainability
The productive resources of our environment are finite and many are non-renewable. They can be thought of as loaned to us from future generations. We strive to responsibly utilize local resources and suppliers whenever possible. In all aspects of our operation we endeavor to fulfill our desires without compromising the ability of future generations to do the same.
1.2.4 Privacy
Through the course of our operation, certain information may be gathered on the membership. Such information collection will always be voluntary (opt-in), and the information will remain the sole property of the individual in question. Except when compelled by law, the Co-op will never share or sell member information.
1.2.5 Responsible Consumption of Alcohol
The prevailing legal conditions regarding the distribution of alcohol are generally retroactive – such as refusing to serve intoxicated individuals. We seek to be proactive in encouraging the responsible consumption of alcohol in a community environment, and will implement practical proactive procedures to prevent intoxicated individuals from driving as set forth by the Board of Directors.
Section 2 Definitions
(a) “Active Member” means a person who meets all the qualifications of Sec. 3.1, has purchased and fully paid for a membership pursuant to Section 3.2, has met all the requirements of Sections 3.3 and 3.4, whose membership has not been inactivated pursuant to Section 3.5 or withdrawn under Section 3.6. When the word “Member” is used hereinafter, unless otherwise specifically indicated, it refers to an Active Member.
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(b) “Back of House Assembly Members” mean those Worker Members who are in charge of the brewing and packaging side of the Co-op. (See Sec. 6.3)
(c) “Back of the House Volunteer” means a Volunteer whose work resides within the brewing and packaging side of the Co-op, after the Back of the House Assembly has created policies concerning such persons that have been adopted by the Board of Directors.(See Sec. 6.3.3)
(d) “Board-Staff Member” means a Co-op Member elected by Worker Members to represent them on the Board of Directors. (See Sec 6.2.4; 6.3.4)
(e) “Cooperative” or “Co-op” means the High Five Co-op Brewery, Inc.
(f) “The Democratic Rules of Order” means a set of rules for running a meeting that can be found at http :// democraticrules . com / tips . html (See Sec. 15.5)
(g) “Front of the House Assembly Members” mean those Worker Members who are in charge of the business operation of the service side of the Co-op. (See Sec. 6.2)
(h) “Front of the House Volunteer” means a Volunteer whose work resides in the business operation of the service side of the Co-op, after the Front of the House Assembly has created policies concerning such persons that have been adopted by the Board of Directors. (See Sec. 6.2.3)
(i) “Individual Member” means a natural person who has met the membership requirements in Sec. 3, but is not necessarily an “Active Member” unless certain other provisions of Section 3 have been met.
(j) “ Leadership Nominating Committee” means a committee which facilitates nomination of Board of Director members. (See Sec. 5.4)
(k) “Living Wage” in Sec 1.2.2 means a wage calculated by the Living Wage formula developed by the Universal Living Wage Campaign, which can be found at http :// www . universallivingwage . org / ulwformula . htm
(l) “Members Assembly” means all Active Members of the Co-op convened to make membership decisions. Said “Assembly” may also be referred to as a “membership meeting”.
(m) “Membership Fee” means a non-refundable fee which a Member must pay to the Co-op as a condition of admission to or retention of membership in the Co-op pursuant to Bylaw Sec. 3.2, which is not member capital or a fee for goods, services, or facilities.
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(n) “Member Capital Account” means an account created under Bylaw Sec. 7 to hold member equity such as any required or voluntary capital contributions and any patronage dividend allocations not yet distributed.
(o) “Member Patronage” is the basis for allocation of Net Savings among members. ( See Sec. 7.2 and Sec. 8)
(p) “Net Savings” is the portion of revenue allocated to Members as patronage. (See Sec. 8)
(q) “Operating Rules” are set by the Board of Directors subject to review by the Members (See Sec. 5.12).
(r) “Participatory Self-Management” is defined in the Operating Rules pursuant to Sec. 1.2.1.
(s) “Present at a Meeting” means that the Member (Sec. 4.3.8) or Board Member (Sec. 5.11) was present in person or attending electronically by a method that enabled him/her to hear and be heard by all other meeting participants.
(t) “Prima Facie Evidence” means evidence that is good and sufficient on its face to establish a given fact.
(u) “Proxy Vote” means one member giving another member authorization to vote on his behalf. PROXY VOTING IS PROHIBITED in these Bylaws.
(v) “Quorum” means that number of persons present which enables a decision making body to make a binding decision.
(w) “Referendum” means a special call for a vote of Active Members (See Secs. 4.3. and 14).
(x) “Volunteer” means a Co-op Member who is doing Co-op work on a volunteer basis and is not an employee or contractor (See Secs. 6.2.3 and 6.3.3).
(y) “Workers Assembly” means all Active Worker Members of the Co-op convened to make Worker Member decisions pursuant to these Bylaws and any Operating Rules. (See Sec. 6)
Section 3 Membership
3.1 Membership Qualifications
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Membership in the Co-op is open to all natural persons at least 21 years of age. All applicant members must provide valid physical and electronic mailing addresses, and agree to abide by these Bylaws, the laws of the State of Michigan, and other rules and policies adopted by the Board of Directors.
3.2 Membership Fee and Certificate
All applicant members must purchase a non-refundable Membership Certificate once accepted by the State of Michigan Liquor Control Commission (MLCC). A member shall pay a Membership Fee to obtain a Membership Certificate. The amount of the Membership Fee shall be set by the Board and may be adjusted from time to time. This “Membership Fee” is a nonredeemable fee which a member must pay to the Cooperative as a condition of admission to membership in the Cooperative which is not Member Capital or a fee for goods, services, or facilities.
3.3 Initiation
Membership shall commence upon the filing of a completed application form, receipt of the necessary associated cost, and any necessary approval by the State of Michigan Liquor Control Commission (MLCC). If the Liquor Control Commission denies your application, you will not become a Member and your Membership Fee will be refunded.
3.4 Individual Members
There shall be one type of member, an Individual Member. All natural persons who have contributed their full assessed Membership Fee (which shall be evidenced by a Membership Certificate) and any required Member Capital (which shall be evidenced by a Member Capital Certificate) shall be known as Individual Members. Except as otherwise provided in the Michigan Consumer Cooperative Act, the Co-op’s Articles of Incorporation or these Bylaws, Membership shall not be transferable and shall be terminated by death, resignation, expulsion, or expiration of a term of membership.
3.4.1 Classes of Individual Members
Individual Members who are employed by the Cooperative are hereinafter called “Worker Members” and all other members are called “Consumer Members”. Worker Members are also Consumer Members, but, in addition they receive an allocation of Net Savings based on their hours worked, and have rights and obligations as members of the Workers Assembly described in Section 6.
3.5 Inactivation of Membership
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A Member may have his/her membership inactivated under certain circumstances as set forth by these Bylaws and the Board of Directors, and once inactivated is not entitled to any benefits of membership.
3.5.1 Address Inactivation
All members without valid mailing addresses (both physical and electronic), or having no other activity with the Co-op for a period of 2 years from the date of address invalidity, shall be considered inactive.
3.5.2 Inactivation Due to Non-Participation
Inactive Members may have their membership reactivated upon transacting business with the Co-op and requesting reactivation from the Co-op Secretary.
3.5.3 Reactivation
Inactive Members may have their membership reactivated upon filing a valid address.
3.6 Termination of Membership
Either party may terminate membership through the procedures given in this section.
3.6.1 Withdrawal
Members may withdraw their membership at any time. Resigning members shall provide a written resignation and an address to which the Co-op may send confirmation of their resignation.
3.6.2 Expulsion
A Member may be expelled for causes including, but not limited to: (a) intentionally or repeatedly violating any provision of the Co-op’s Articles of Incorporation, Bylaws, Operating Rules or Board policies; (b) breaching any contract with the Co-op; (c) willfully obstructing any lawful purpose or activity of the Co-op. Expulsion requires a majority vote of the Board of Directors, and Members who are to be expelled shall be given notice of the proposed expulsion and an opportunity to address a meeting of the Board of Directors.
3.6.3 Return of Membership Certificate
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When a Member withdraws from the Co-op, his Membership Certificate shall be returned and if not returned shall be cancelled. Membership Fee is not refundable.
3.6.4 Termination of Membership upon Death of Member
Membership is not transferrable and thus shall terminate upon the death of a Member. Assets in any Member Capital Accounts or Certificates, or Non-Voting Investment Certificates or non-Voting Investment Bonds shall be redeemed pursuant to Sec. 7.5 of these Bylaws.
Section 4 Members’ Assembly
4.1 Definition
The Members’ Assembly comprises all Active Members of the Co-op.
4.2 Powers & Duties
The Members’ Assembly is the voice of the membership and holds the following powers, as well as any other powers granted to the membership under Michigan law: (a) election and removal of Directors; (b) passage of advisory resolutions for consideration by the Board, (c) and all other rights given them in these Bylaws particularly as outlined in this Section and in future Bylaws or Operating Rules.
4.3 Regular and Annual Member Meeting
The Members’ Assembly shall meet at least once per calendar year at the Co-op facility or any other location in Grand Rapids, Michigan as determined by the Board. The Board is responsible for calling, organizing, and presiding over all meetings of the Members’ Assembly.An annual meeting of Members for election of Directors and for such other business as may come before the Members shall be held on the third Sunday in May unless action is taken by the Board of Directors to move or change the date. Annual reports on the finances and activities of the organization will be given at the annual meeting. Failure to hold the annual meeting at the designated time, or to elect a sufficient number of Directors at the meeting or any adjournment of the meeting, does not affect or otherwise invalidate corporate acts or work a forfeiture or give cause for dissolution of the corporation. If the annual meeting is not held on the date designated, the Board of Directors shall cause the meeting to be held as soon thereafter as convenient. If the annual meeting is not held for 90 days after the date designated, or if no date has been designated for 15 months after organization of the co-op or after its last annual
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meeting, the circuit court for the county in which the registered office of the co-op is located, upon application of a member, may summarily order the meeting or the election, or both, to be held at such time and place, upon such notice, and for the transaction of such business as may be designated in the order. At any such meeting ordered to be called by the court, the members, present in person and having voting powers, constitute a quorum for transaction of the business designated in the order.
4.3.1 Notice of Members’ Assembly
Notice of the day, time, place and purposes of a meeting of members shall be given by written notice, given personally, by mail, or by electronic transmission, to address of record, not less than 15 nor more than 60 days before the date of the meeting to each member of record entitled to vote at the meeting.
Attendance of a person at a meeting of members constitutes a waiver of objection to lack of notice or defective notice of the meeting, unless the member at the beginning of the meeting objects to holding the meeting or transacting business at the meeting. If a member is permitted to participate in and vote at a meeting by remote communication, the notice shall include a description of the means of remote communication by which a member may participate.
4.3.2 Making and Certifying List of Members Entitled to Vote at Meeting
The Secretary, or other officer, having charge of the membership records of the co-op shall make and certify a complete list of the members entitled to vote at a members’ meeting or any adjourned members’ meeting. The list shall meet all of the following:
(a) Be arranged alphabetically with the address (or email address) of each member.
(b) Be produced at the time and place of the meeting.
(c) Be open to examination by any member during the entire meeting. If the meeting is held solely by means of remote communication, then the list shall be open to the examination of any member during the entire meeting by posting the list on a reasonably accessible electronic network, and the information required to access the list shall be provided with the notice of the meeting.
(d) Be prima facie evidence as to who are the members entitled to examine the list or to vote at the meeting.
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If the requirements of this section have not been complied with, and a member in good faith challenges the existence of sufficient votes to carry any action at the meeting, the meeting shall be adjourned until the requirements of this section are met; unless said challenge does not affect the validity of an action taken at the meeting before the making of a challenge under this subsection.
4.3.3 Quorum of Members
The quorum required to conduct business at a membership meeting shall be 10% of the Active Members or 50 Active Members, whichever is less. Voting for Board of Director members shall be conducted by secret ballot. The members present at such meeting may continue to do business until adjournment, notwithstanding the withdrawal of enough members to leave less than a quorum. Whether or not a quorum is present, the meeting may be adjourned by a vote of the Members present.
4.3.3.1 Notice of Adjourned MeetingIf a meeting of the Members is adjourned to another time or place, it is not necessary, unless the Bylaws otherwise provide, to give notice of the adjourned meeting if the time and place to which the meeting is adjourned are announced at the meeting at which the adjournment is taken. If after the adjournment the board fixes a new record date for the adjourned meeting, a notice of the adjourned meeting shall be given to each Member of record on the new record date entitled to notice under Bylaws subsection 4.3.1.
4.3.3.2 Business of Adjourned MeetingsIf a meeting of Members is adjourned under subsection 4.3.3.1, only business that might have been transacted at the original meeting may be transacted at the adjourned meeting if a notice of the adjourned meeting is not given.
4.3.3.3 Waiver of Notice of MeetingsAttendance of a person at a meeting of Members, in person or electronically, constitutes a waiver of objection to lack of notice or defective notice of the meeting, unless the Member at the beginning of the meeting objects to holding the meeting or transacting business at the meeting.
4.3.3.4 Clarification of Accepted Means of Remote Meeting AttendanceIf a Member is permitted to participate in and vote at a meeting by remote communication under subsection 4.3.1, the notice described in section 4.3.1 shall include a description of the means of remote communication by which a board Member may participate.
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4.3.4 Special Meetings of Members
Special meetings may be called by a majority vote of the Board of Directors or by a written petition of at least 10% of the Active Members. The membership shall receive notification of the special meeting at least 10 days before the meeting date. Quorum for a special meeting shall be 10% of the Active Members or 50 Active Members whichever is less.
4.3.5 Voting
The standard for a successful vote shall be a simple majority of Active Members present at a meeting which has been called with proper notice or waiver of notice at which a quorum is present, unless otherwise specified in these Bylaws. Voting shall be conducted by ballot, either written or electronic.
4.3.5.1 Actions Requiring Majority Vote of All Members. Except as provided otherwise in the Articles of Incorporation, or in Section 11, which requires a vote of a majority of all Members for dissolution, and Section 14 which requires 2/3 majority of Active Members voting to amend the Articles and Bylaws, any amendment of these Bylaws which alters Member Capital, merger, consolidation, disposition of all or substantially all of the assets of the corporation shall be adopted by the affirmative vote of a majority of the votes cast by Members eligible to vote thereon, and if a class is eligible to vote thereon as a class, the affirmative vote of a majority of the votes cast by Members of each class. Such action may only be taken at a meeting called according to the notice provisions of MCL Section 450.2404.
4.3.5.2 Actions Requiring Confirmation Vote; Time Limits.
4.3.5.2.1 An action subject to the vote requirement of Section 4.3.5.1 of these Bylaws shall not take effect for 60 days from the date of adoption and shall be subject to 1 confirmation vote as provided in subsection.
4.3.5.2.2 If the action is adopted by less than a majority of all the Members eligible to vote.
4.3.5.2.3 If a petition of 15% or more of the Members eligible to vote is presented to the Cooperative Board prior to the sixtieth day after the adoption of the action, the Cooperative Board shall cause a confirmation
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vote to be held. The Cooperative shall cause a special meeting or, if authorized, mail ballot or referendum to be conducted within 45 days of receipt of the petition. The confirmation vote must achieve the vote which would have been required for original adoption. If confirmed, the action or amendment may take effect immediately after the confirmation or upon filing with the administrator, if such filing is required.
4.3.5.2.4 If an action or amendment is subject to confirmation, a filing of the proposed amendment shall not be made with the state until the time for presenting a petition has expired or the action is confirmed.
4.3.5.3 Dissenters Call for Referendum after Meeting Vote. Meeting votes conducted at a meeting of the Members’ Assembly called with proper notice, at which a quorum is present, shall be final unless a dissenting minority consisting of at least 1/3 of the Members present at the meeting calls for a referendum on the issue at hand. Proxy votes are prohibited.
4.3.6 Referenda
A referendum may be called by a majority of the Board of Directors, a petition of at least 25 Members, or a dissenting minority of at least 1/3 of the Members present during a meeting vote who sign a document confirming their dissent and present it to the Cooperative’s Board of Directors. The Board shall also schedule a referendum whenever required under Article XII of the Articles of Incorporation or under these Bylaws . A Referenda may be conducted in-store, by postal mail, or on the Co-op’s website, and are required for the election of the Board of Directors. Referenda shall be open for at least 7 days, but shall continue until at least 100 Members (or 10% of the membership, whichever is less) have cast a ballot. After the Referendum has closed, the decision will be based on the majority of the larger number of votes cast in whichever method received the most votes. So if more Members voted in the referendum, its decision shall prevail. If more Members voted in the initial meeting, its vote shall prevail.
4.3.7 Notice for Voting in a Referendum
Notices of member referenda shall be given by written notice, given personally, by mail, or by electronic transmission, to the Member’s address of record, not less than 15 nor more than 60 days before the date on which referendum voting shall open, to each Member of record entitled to vote in the referendum. Said notice shall contain the opening date and minimum closing date for the referendum; instructions for casting votes electronically, by ballot (including location of any ballot boxes,) or other means; and purposes of the referendum.
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4.3.8 Electronic Member Participation in Meetings
A Member may participate in a Members’ meeting by a conference telephone or other means of remote communication by which all persons participating in the meeting may hear each other if all participants are advised of the means of remote communication in use and the names of the participants in the meeting are divulged to all participants.
4.3.8.1 Presence in Electronic Meetings.Participation in a meeting pursuant to this section constitutes presence in person at the meeting.
4.3.8.2 Permissions and Restrictions Regarding Electronic Meetings.Unless otherwise restricted by any provisions of the Articles of Incorporation or Bylaws, the Board of Directors may hold a meeting of Members conducted solely by means of remote communication.
4.3.8.3 Provisions for Electronic Attendance of In-Person Meeting.Subject to any guidelines and procedures adopted by the Board of Directors, Members not physically present at a meeting of Members may participate in the meeting by means of remote communication and are considered present in person and may vote at the meeting if all of the following are met:
(a) The Cooperative implements reasonable measures to verify that each person considered present and permitted to vote at the meeting by means of remote communication is a Member.
(b) The Cooperative implements reasonable measures to provide each Member a reasonable opportunity to participate in the meeting and to vote on matters submitted to the Members, including an opportunity to read or hear the proceedings of the meeting substantially concurrently with the proceedings.
(c) If any Member votes or takes other action at the meeting by means of remote communication, a record of the vote or other action is maintained by the Cooperative.
(d) A Member may be present and vote at an adjourned meeting of the Members by a means of remote communication if he or she was permitted to be present and vote by that means of remote
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communication in the original meeting notice given under section 4.3 of these Bylaws.
Section 5 Board of Directors
5.1 Definition of Board of Directors
The Board shall consist of seven Directors elected by the entire membership and two directors elected solely by the Workers Assembly.
5.2 Powers & Duties of the Board
The Board is responsible for setting policy, issuing Membership Certificates, Member Capital Certificates, Investment Certificates and Investment Bonds; creating and amending Operating Rules for the Cooperative and ensuring that all actions taken by the Cooperative are both lawful and consistent with these Bylaws. The Board has the authority to create standing committees or ad hoc committees that may include Board Members or other Co-op Members that are not Board Members. The Board shall determine the authority and duration of said committees.
5.2.1 General Manager and Operations Manager
The Board has the authority to hire and fire a General Manager to run the Front of the House and an Operations Manager to run the Back of the House. The General Manager and Operations Managers will have the authority to hire and fire employees working in their part of the Co-op, subject to all relevant employment laws and subject to any additional policies for review of these actions adopted in the Co-op’s Operating Rules, including its provisions for Participatory Self-Management. The General Manager will be responsible for payment of all taxes, payroll and safety compliance. 5.2.2 Convening Workers’ Assembly
The Board shall convene the initial meeting of the Workers’ Assembly to ensure that the Back of House Assembly and Front of House Assembly each elect a Board-Staff Member. Thereafter, the Workers’ Assembly shall manage its own affairs including elections and calling meetings. However, the Board may convene a Workers’ Assembly meeting, if after a written requesting to the Board-Staff Members to convene such a meeting, no action is taken to convene the meeting within 5 days of the request.
5.3 Eligibility for Board Service
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Directors may or may not be members of the Co-op; however, once the Co-op is able to accept Members, all Officers must be Active Members, and not otherwise excluded from service on the Board by the Michigan Liquor Control Commission or other agency regulating the Co-op’s business.
5.4 Board Nominations
The Board shall establish a Leadership Nominating Committee that will seek out qualified Members to run for the Board. Any Member may nominate him/herself or any other Member for the Board. All candidates for Board positions must fill out an application for inclusion among the Board candidates, present themselves at the applicable meeting of the Members' Assembly, and disclose all possible conflicts of interest they may hold. The Leadership Nominating Committee shall facilitate this process by making applications readily available to all Members, collecting applications and providing the collected application information to the Members in conjunction with the Board election referendum and shall manage the Board election referendum process in Sec. 5.6.1 of these Bylaws.
5.5 Terms of Board Service
At the first election for the non-Worker Assembly Board Members, the four individuals with the most votes shall serve two year terms and the next three individuals with the most votes shall serve one year terms. Thereafter, all terms shall be two year terms. The Board-Staff Members shall be elected pursuant to Bylaws Sec.6.1.2 .A director shall hold office for the term for which he or she is elected or appointed and until his or her successor is elected or appointed and qualified, or until his or her resignation or removal. A director may resign by written notice to the corporation. A resignation of a director is effective when it is received by the corporation or at a later time if set forth in the notice of resignation.
5.6 Election & Removal of Board Members
5.6.1 Election of Board Members
Board elections shall be held by a Referendum of the Active Members. An election vote shall be open for 14 days, even if the required number of ballots for a successful normal referendum has already been cast. Referendum notice requirements of subsection 4.3.7 shall apply.
5.6.2 Removal of Board Members
A Director may be removed with or without cause. Removal requires a vote of two-thirds
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vote of the Board, or a majority vote of a meeting of the Members’ Assembly at which a quorum is present.
5.6.3 Board Vacancies
Should a vacancy arise, the Board shall choose an individual to fill that position on a temporary basis until the next election cycle. Should a vacancy arise in one of the Worker’s Assembly positions, the affected side of the house of the Worker’s Assembly, at its next monthly meeting, shall elect an individual to fill that position for the remainder of the term.
5.7 Officers of the Board
The officers of the Board shall consist of President, Vice President, Treasurer and a Secretary. The Board shall elect officers annually at its Organizational Meeting (Sec. 5.8.1).
5.7.1 President
The President is the Chairperson of the Board and has responsibility for calling meetings, preparing the agenda, and facilitating meetings. The President is the Chief Executive Officer of the Cooperative. The President shall preside over all meetings of the Members, except the Workers’ Assembly, and of the Board and shall be an ex-officio a member of all standing committees.
5.7.2 Vice-President
Vice President assists the President in said duties, participating in executive board discussions and decision-making and presiding over meetings in the President’s absence. The Vice-President shall be responsible for maintaining communication with and accountability for assigned tasks from any board committees.
5.7.3 Treasurer
The Treasurer is responsible for managing and reporting on the Co-op’s finances. The Treasurer shall have custody of all Cooperative funds and securities and shall keep in books belonging to the Cooperative full and accurate accounts of all receipts and disbursements. The Treasurer shall deposit all monies, securities, and other valuable effects in the name of the Cooperative in depositories the Board designates for that purpose. The Treasurer shall disburse the funds of the Cooperative as ordered by the Board, taking proper vouchers for the disbursements, get a second signature on all expenditures, and shall render to the President and Directors at regular meetings of the
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Board, and whenever requested by them, an account of all transactions and of the financial condition of the Cooperative.
5.7.4 Secretary
The Secretary is responsible for documenting the meetings of the Board. The Secretary shall attend all meetings of the Members, of the Board, and of any executive committee and shall preserve in books of the Cooperative true minutes of the proceedings of all meetings. The Secretary shall safely keep in custody any seal of the Cooperative and shall have authority to affix the seal to all documents on which its use is required. The Secretary shall give all notices required by statute, Bylaw, or resolution and shall perform other duties delegated to the Secretary by the Board or by the President. With Board approval, the Secretary may use paid staff to take meeting notes provided the Secretary is responsible for reviewing and approving any official minutes before they are distributed.
5.8 Board Meetings
5.8.1 Organizational Meeting of Board
At the same place as the annual meeting of Members and immediately following it, the Board as constituted on final adjournment of the annual meeting shall convene an organizational meeting to elect officers and transact any other business properly proposed. The organizational meeting in any year may be held at a different time and place by consent of a majority of the Directors.
5.8.2 Regular Meetings of the Board
The Board shall meet on a monthly basis. At least 12 regular meetings of the Board must be held in a given calendar year. If quorum is not available or if reasonable objection to meeting notice has been made by a Board member, the Board shall reschedule the meeting for another date and distribute new meeting notices.
5.8.3 Special Meetings of the Board
Special meetings of the Board may be called for by the President subject to a seconding by another Member, or by request of 3 other Directors.
5.8.4 Notice of Board Meetings
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The Board members and membership shall be given notice of Board meetings at least 2 weeks prior to the meeting date. The proposed agenda of the Board meeting shall be made available at least 7 days prior to the meeting. However, the board may amend its agenda at any time before or during the board meeting with majority consent of the board members present. Presence at a meeting shall waive notice of that meeting unless the party is present only to raise the notice issue.
5.8.5 Board Quorum
At least one more than half the numbers of Directors, of the seats currently held, must be present at all duly called Board meetings for a quorum to exist that will enable the board to transact business. A Director may be considered present through any electronic means, as described in Sec. 5.11 of these Bylaws that enables his or her full participation in the meeting dialogue.
5.8.5.1 Conflicts of Interest. When considering issues of potential Board member conflict of interest, a quorum of the non-interested directors shall decide the conflict issue. If a quorum of Directors, of the seats currently held, exists but a quorum on an issue cannot be established among non-interested Directors then any number of non-interested Directors totaling two or more shall be considered a quorum for the purpose of transacting the business at hand. Directors abstaining for reasons other than being interested in the current issue shall be included in quorum.
5.8.5.2 Transaction of Business Without a Quorum. If a quorum at a duly called and noticed Board meeting cannot be established then a sub-quorum totaling 50% or more of quorum can be established to discuss and transact business but any decisions made are non-binding until ratified at a meeting with a full quorum.
5.8.5.3 Electronic Votes. An email vote, or email poll, shall follow the same quorum rules as a regular Board meeting except that Board members have 48 hours, from the timestamp on the email, to respond to the request to have their presence counted for quorum and their vote, or abstention, cast. Any email vote request must include a request for confirmation of email delivery. A board member who has not received a request for email vote, may object upon learning of the email vote, and may request that the vote be redone by any of the means available to the board. If the sender has a confirmation of email delivery then that is prima facie evidence that the email request was properly sent. The rules of Bylaws Sec. 5.11
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apply. The Board shall establish procedures whereby the membership can opt-in to receive notice of Board votes by email, and a record of all the email communications on the issue shall be kept and presented as minutes at the next regular Board meeting.
5.8.6 Closed Meetings of the Board
All meetings of the Board shall be open to members except for those matters specifically pertaining to personnel, litigation, real estate, or any other matter deemed sensitive by the Board.
5.9 Board Compensation and Expense Reimbursement
The Initial Board of Directors shall be volunteers. At such time as the Board determines that compensation for board members is needed, the Board shall provide a written proposal on board compensation policy for approval by the Membership. However, compensation of the Board shall not exceed that of any other position within the Co-op. However, whether, Board members are volunteer or paid, board members ‘ expenses for travel, supplies and other expenditures on behalf of the Co-op shall be compensated at cost, upon provision of receipts to the Treasurer and approval by the Board. At least 10, but not more than 90, days before each annual Members’ Assembly, a detailed account of board member expenses shall be provided by the Treasurer to the Members.
5.10 Board Action without a Meeting by Unanimous Consent
The Board may take any action it could take at a duly called meeting, by circulating in writing the matter to be decided. If all Board members sign a unanimous written consent, the action has the same effect as if taken at a properly called Board meeting. Said consent may include a waiver of notice.
5.11 Electronic Board Member Participation in Meetings A board member may participate in a board meeting by a conference telephone or other means of remote communication by which all persons participating in the meeting may hear each other if all participants are advised of the means of remote communication in use and the names of the participants in the meeting are divulged to all participants.
5.11.1 Electronic Participation by Board Members
Participation in a meeting pursuant to this section constitutes presence in person at the meeting.
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5.11.2 Remote Communication
Unless otherwise restricted by any provisions of the Articles of Incorporation or Bylaws, the board of directors may hold a board meeting conducted solely by means of remote communication. Subject to any guidelines and procedures adopted by the board of directors, board members not physically present at a board meeting may participate in the meeting by means of remote communication and are considered present in person and may vote at the meeting if all of the following are met:
(a) The Cooperative implements reasonable measures to verify that each person considered present and permitted to vote at the board meeting by means of remote communication is a board member.
(b) The Cooperative implements reasonable measures to provide each board member a reasonable opportunity to participate in the meeting and to vote on matters submitted to the board members, including an opportunity to read or hear the proceedings of the meeting substantially concurrently with the proceedings.
(c) If any board member votes or takes other action at the meeting by means of remote communication, a record of the vote or other action is maintained by the cooperative.
(d) A board member may be present and vote at an adjourned meeting of the board by a means of remote communication if he or she was permitted to be present and vote by that means of remote communication in the original meeting notice given under section 5.8 of these Bylaws.
5.12 Operating Rules
The Board shall create Operating Rules in consultation with affected Members. Operating Rules will be enacted by a majority vote of the Board, subject to review by Members Assembly or through petition for a referendum in Bylaws Sec. 4.
Section 6 Workers’ Assembly and Board Staff Members
6. 1 Related Definitions
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6.1.1 Workers’ Assembly
The Workers' Assembly consists of all Active Members currently employed by the Co-op. The Assembly will be divided into two sections: “Front of House ” and “Back of House”. The two Board-Staff members shall convene and facilitate meetings of the Workers’ Assembly, including the Back of House Assembly and the Front of House Assembly. Meetings of the Workers’ Assembly, Back of House Assembly and Front of House Assembly may also be convened by the Worker Members pursuant to subsection 6.4.3.
6.1.2 Board - Staff Members
The Front of the House Worker’s Assembly and the Back of the House Worker’s Assembly shall each elect a Board-Staff Member to convene meetings of their section and to represent them on the Board of Directors pursuant to Bylaws as further described in this Sec. 6.
6.2. Front of the House Assembly
6.2.1 Workers Included in Front of the House Assembly
The General Manager shall hire Front of the House workers. Any worker who is not a Member at time of hire, shall become a Member as a condition of hire. A worker who is not a Member upon hire may pay his/her Membership Fee by payroll deduction and shall not become a Member until the Membership Fee is paid in full, and shall not have a vote in the Workers’ Assembly until said Membership Fee is paid in full. The Front of the House Assembly shall include all Active Members who are employed by the Co-op to do work in the Front of the House.
6.2.2 Front of House Assembly Powers and Duties
The Front of House Assembly is charged with the business operations of the service side of the Co-op. It shall implement policies and regulations necessary to fulfill its tasks provided they are not inconsistent with either these Bylaws or Board policy. The Front of House Assembly communicates with the Board through its representative as defined in section 6.2.4.
6.2.3 Front of the House Volunteers
The Front of House Assembly may make use of volunteers, but must first submit volunteer policies, which will include policies on liability for volunteer acts and relevant
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insurance, for approval by the Board of Directors. The policies must additionally include standards for volunteers. Volunteers are not members of the Workers’ Assembly. 6.2.4 Front of House Board-Staff Member
The Front of House Assembly shall elect one individual to chair their meetings, and that person shall also serve as their elected representative to the Board of Directors.
6.3 Back of the House Assembly
6.3.1 Workers Included in the Back of the House Assembly
The Back of the House Assembly shall include all Active Members who are employed by the Co-op to do work in the Back of the House. The Operations Manager shall hire Back of the House workers. Any worker who is not a Member at time of hire, shall become a Member as a condition of hire. A worker who is not a Member upon hire may pay his/her Membership Fee by payroll deduction and shall not become a Member until the Membership Fee is paid in full, and shall not have a vote in the Workers’ Assembly until said Membership Fee is paid in full.
6.3.2 Back of House Assembly Members: Powers and Duties
The Back of House Assembly is charged with the business operations of the Brewing and packaging Side of the Co-op. It shall implement policies and regulations necessary to fulfill its tasks provided they are not inconsistent with either these Bylaws or Board policy. The Back of House Assembly communicates with the Board through its elected representative to the Board of Directors as defined in section 6.3.4.
6.3.3 Back of the House Volunteers
The Back of House Assembly may make use of volunteers, but must first submit volunteer policies, which will include policies on liability for volunteer acts and relevant insurance, for approval by the Board of Directors. Volunteers in the Brewhouse area are required to sign waivers removing the Co-op of responsibility of personal injury to the volunteer or others injured by acts, work or products of the volunteer while working with potentially dangerous equipment. The policies must additionally include standards for volunteers. Volunteers are not members of the Workers’ Assembly.
6.3.4 Back of House Board-Staff Member
The Back of House Assembly shall elect one individual to chair their meetings, and that person shall also serve as their elected member of the Board of Directors.
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6.4 Board Staff Members Service—Both Front and Back of House
6.4.1 Term of Service for Board Staff
The Board-Staff Members shall be elected on an annual basis, and may serve no more than two consecutive terms in office.
6.4.2 Recall of Board Staff
A Board-Staff Member may be recalled by a 2/3 vote of the Board (excluding the member subject to recall), or by a petition (presented to and accepted by the Board) from 2/3 of the members of the Workers’ Assembly from the side of the house represented by that Board-Staff Member. In the event of such a recall, the relevant side of the house of the Workers’ Assembly shall hold a special election to choose a new Board-Staff member(s).
6.4.3 Meetings
The Workers’ Assembly must meet at least once each month, but is free to meet more often as provided by its rules of operation. Either or both Board Staff Members may call a meeting of the Workers’ Assembly. A Board Staff Member may call a meeting of the Workers’ Assembly for his/her side of the house. Three or more Workers’ Assembly members may, by signing a petition and providing proper meeting notice that includes a copy of the petition, call a Workers’ Assembly meeting. All employees must receive notification of meetings at least 7 days before the meeting date. All employees are required to attend the annual membership meeting, see section 4.3.
Section 7 Capital Accounts
7.1 Member Capital Accounts
Each Member shall have a Member Capital Account. If there is a call for member capital, or if at some point a member capital investment is required to become a Member, the Member Capital Account will be the record of the Members’ Capital Contribution. Member Capital Accounts will also hold allocated patronage dividends until distribution.
7.2 Patronage Allocation to Member Capital Accounts
7.2.1 Consumer Patronage
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Patronage for Consumer Members shall be based on their purchases from the Co-op determined by dollars spent per fiscal year.
7.2.2 Worker Patronage
Patronage for Worker Members shall be the number of hours they worked and were paid for by the Co-op as a percentage of all the Worker Member hours worked and paid for by the Co-op per fiscal year.
7.3 Non-Voting Investment Certificates
7.3.1 Eligibility for Owning Non-Voting Investment Certificates
Non-Voting Investment Certificates will be sold only to Co-op Members.
7.3.2 Terms of Non-Voting Certificates
Non-Voting Investment Certificates will be sold for a principal amount stated on the Certificate. Interest up to 8% per annum may be paid as a dividend on Non-Voting Investment Certificates, as determined by the Board of Directors at the end of each fiscal year. Dividends will not be cumulative. These Certificates are non-transferrable except that they may be sold only to the Co-op or to a buyer approved by the Co-op. The holders of these Certificates have no voting rights. The terms of such a Certificate shall be stated on the Certificate.
7.4 Non-Voting Investment Bonds
7.4.1 Bond Eligibility
Non-Voting Investment Bonds will be sold only to Co-op Members.
7.4.2 Terms of Bond
Non-Voting Investment Bonds will be sold for a principal amount and include a redemption date stated on the Bond. The Co-op is obligated to repay bonds on their redemption date, unless doing so would cause the Co-op to be insolvent, in which case they shall be repaid as soon thereafter as will not cause insolvency. Said Bonds will also state the amount and basis on which interest shall be paid. However, under no circumstances will interest in excess of 8% per annum be paid on Non-Voting Investment Bonds. These Bonds are non-transferrable except that they may be sold only to the Co-
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op or to a buyer approved by the Co-op. The holders of these Bonds have no voting rights. The terms of such a Bond shall be stated on the Bond.
7.5 Transfer to Estate Upon Death of Holder
Membership shall terminate upon death of the Member. Except as otherwise provided in the Michigan Consumer Cooperative Act, the Articles of Incorporation or these Bylaws, Membership Capital Certificates, Non-Voting Investment Certificates and Non-Voting Investment Bonds shall not be transferable (except that the estate of holders may hold them until redeemed by the Cooperative) except with approval of the Board. If the Board and holder cannot find an acceptable transfer party, the Co-op will redeem said Certificate or Bond as rapidly as possible except when currently the cooperative is insolvent or would thereby be made insolvent.
7.6 Redemption of Member Capital and Termination of Membership
7.6.1 Terms of Redemption of Member Capital
Upon termination of a Membership issued on a Member Capital basis, the Cooperative shall redeem the Member's Member Capital (which is not the same as the non-redeemable Membership Fee) by paying to the Member in cash or other property (i) the lesser of the Member's Member Capital or the Member's pro rata share of the total Member Capital of the Cooperative determined according to the ratio each Member's Member Capital bears to total Member Capital, unless a different proration is provided in the Articles of Incorporation; or (ii) such other amount as may be provided in the Articles or Bylaws. Payment shall be made within 5 years from the date of termination, unless the Articles or Bylaws provide for a different period for payment.
7.6.2 Partial Redemption of Member Capital
Unless the Articles or Bylaws provide that Member Capital is not redeemable, the Cooperative may adopt and implement any plan to partially redeem Member Capital.
7.6.3 Circumstances of Non-Redemption of Member Capital
The Cooperative shall not redeem Member Capital or any portion thereof under either of the following conditions:
(a) When the Cooperative is insolvent or when the redemption would render the Cooperative insolvent.
(b) Unless after redemption there remains outstanding 1 or more classes of Members possessing among them, collectively, voting rights.
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7.6.4 Termination of Membership
Bylaw Section 3.5 describes inactivation of membership and how it may be reactivated. Bylaw Section 3.6 describes the circumstances under which membership may be terminated.
7.6.5 Notice of Entitlement to Redemption
A person entitled to payment for redemption of Member Capital shall be given reasonable notice of the redemption, which notice may be by mail to the last known address of the person. If the person fails to respond to the notice and claim the payment within 5 years from the date of notice, that person shall have no further rights in the Member Capital and the Member Capital may be added to the general funds of the Cooperative.
7.6.6 Special Circumstances
If this Cooperative ever permits a nonmember patron to subscribe for membership by making payments or allocating patronage to a pre-membership account, a nonmember who has so subscribed for Membership has not paid in or accumulated the full member Capital required for membership or has failed to comply with the provisions of the Bylaws, if any, concerning admission to membership, any amounts allocated from Net Savings and credited to a Member Capital account of the nonmember patron may be added to the general funds of the Cooperative and thereafter the nonmember patron shall have no further rights therein.
Section 8 Net Savings, Determination, Allocation, Apportionment of Losses
At least once each year, the Cooperative shall determine its Net Savings by deducting from total income:
(a) All operating costs and expenses.
(b) Reasonable reserves for depreciation and obsolescence of property, doubtful accounts, other valuation or operating reserves, capital investments and reserves for capital investment. These reserves may include retention of capital to provide for any needs of the Cooperative, including changes in employee benefits or consumer discounts.
(c) Dividends paid on Member Capital and interest or dividends paid on nonvoting investment certificates or bonds, if any.
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The remainder is Net Savings which shall be allocated as determined by the Board of Directors for the common benefit of all the patrons of the Cooperative.
8.1 Allocation of Net Savings
Unless the Articles or Bylaws provide otherwise Net Savings may be allocated, distributed, or used in any of the following ways:
8.1.1 Patronage Refunds
Net Savings will be allocated as patronage dividends between the two classes of Individual Members, Consumer and Worker (Bylaws Sec. 3.4.1). The Board will allocate a portion of Net Savings among the Consumer Members based on their consumer patronage as described in Bylaws Sec. 7.2.1 and will allocate a portion among the Worker Members based on their work patronage as described in Bylaws Sec. 7.2.2.
8.1.2 Capital Accounts
By allocation of Net Savings to all Members at a uniform rate in proportion to their individual patronage, provided that different rates of allocation may be established according to the Net Savings generated by various types of Member patronage, different classes of Members, departments or types of business done by the Cooperative. Distribution to patrons may be made in cash or credits. Credits shall be evidenced by revolving fund certificates, notices of allocation, capital credits, or other certificates or notices of the cooperative, or any combination thereof.
8.1.3 Improved Member Services
By allocation to retained earnings, operating costs or capital expenditures of the cooperative to reduce the costs of goods, facilities, or services, to improve the quality provided or otherwise to further the common benefit of the Members.
8.2 Allocation of Net Losses
Losses may be allocated by the Board for the common benefit of all the Members of the Cooperative as they deem proper. Following are the preferred priorities for allocation of losses: First, absorbed by the unallocated collective savings; second, decrease in Consumer Member discounts; third, postponement of dividend payments; fourth, allocation to Member Capital accounts; fifth reduction of Worker Member pay or benefits.
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Section 9 Certificates of Membership and Investment
Pursuant to MLCS Sec. 450.3138, prior to accepting a person as a Member or any Membership Fee or Member Capital, the Cooperative shall advise the person in writing of the items in this Section 9. The Cooperative shall also conspicuously state on each Membership Certificate, Member Capital Certificate, Non-Voting Investment Certificate and Non-Voting Investment Bond that the Cooperative is organized under the Consumer Cooperative Act, a statement of any restrictions on transfer of membership and any rights to redemption of Member Capital or a statement that Member Capital is not redeemable. Specifically, every Certificate will bear the following:
(a) A statement that the corporation is a cooperative subject to this act and under what act it is organized.
(b) A statement that the purpose of becoming a member of a cooperative is to assure access to the goods, services, and facilities of the cooperative and not to gain profit.
(c) A statement of voting rights and rights to notice of meetings of Members.
(d) A statement of the qualifications for admission to and retention of membership and the right of the Cooperative to terminate membership, if any.
(e) A statement of the restrictions, if any, on the transfer of memberships.
(f) A statement of the rights to redemption of a Member Capital, if any, or a statement that Member Capital is not redeemable.
(g) A statement of the right of Members to call special meetings or cause a mail ballot, to receive annual reports, and to secure other material information concerning the Cooperative.
(h) In the case of Member Capital Certificates, Non-Voting Investment Certificates and Non-Voting Investment Bonds the terms on which capital has been invested in the Co-op, the basis on which it may be redeemed, any rights to dividends and statement that these instruments have no voting power.
Section 10 Restriction on Payment of Dividends
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The Board of Directors shall not pay dividends nor redeem Member Capital when currently the Cooperative is insolvent or would thereby be made insolvent, or when the declaration, payment, or distribution of a dividend would be contrary to the Articles or Bylaws.
Section 11 Dissolution and Distribution of Assets
In the event of an amendment to the Articles or Bylaws, merger, consolidation, or disposition of substantially all of the assets of the Cooperative, or dissolution, which results in a distribution of all or substantially all of the assets of the Cooperative to Members, the distribution shall be in the manner and order provided in the following manner:
11.1 Dissolution
The Cooperative may be dissolved by action of its Members subject to the requirements of Bylaws Section 11.4 based on a Plan of Dissolution presented to the Members by the Board of Directors. If the majority of the entire membership votes approval of the Plan of Dissolution.
11.2 Rules Governing Dissolution
If the Membership approves the Board’s proposed Plan of Dissolution, the Board shall adopt a resolution that the Cooperative be dissolved based on the Member approved Plan of Dissolution. The Plan of Dissolution shall provide for implementation of an asset distribution plan complying with section MCL Sections 450.2855 and 450.3138.
11.2.1 Payment of Liabilities upon Dissolution
All liabilities and obligations of the Cooperative shall be paid and discharged, or adequate provision shall be made therefore.
11.2.2 Return of Assets Held Under Condition
Assets held by the Cooperative upon condition requiring return, transfer, or conveyance, which condition occurs by reason of the dissolution, shall be returned, transferred, or conveyed in accordance with such requirements.
11.2.3 Return of Charitable Assets Not Held Under Condition
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Assets received and held by the Cooperative subject to limitations permitting their use only for charitable, religious, eleemosynary, benevolent, educational, or similar purposes, but not held upon a condition requiring return, transfer, or conveyance by reason of the dissolution, shall be transferred or conveyed in accordance with any provisions in the Articles of Incorporation or Bylaws which designate 1 or more recipients or a mechanism for determining 1 or more recipients which are domestic or foreign Cooperatives, societies, or organizations, including governmental agencies, engaged in activities furthering such purposes. If the Articles of Incorporation or Bylaws do not contain such provisions, such assets shall be transferred or conveyed to 1 or more domestic or foreign Cooperatives, societies, non-profit entities or organizations, including governmental agencies, engaged in activities substantially similar to or consistent with those of the dissolving Cooperative.
11.2.4 Distribution of Assets to Cooperative Members, Investors and Patrons
Notwithstanding MCL Sec. 450.2855, upon dissolution and after meeting the requirements of the preceding subsections of this Bylaws Sec. 11, assets of a Cooperative shall be distributed in the following manner and order unless otherwise stated in the Co-op’s Articles of Bylaw’s:
(a) By redeeming Member Capital by paying to the Member in cash or other property (i) the lesser of the Member's Member Capital or the Member's pro rata share of total Member Capital of the Cooperative determined according to the ratio each Member's Member Capital bears to total Member Capital, unless a different proration is provided in the Articles; or (ii) such other amount as may be provided in the Articles or Bylaws.
(b) By redeeming Investment certificates issued pursuant to Bylaws Sec. 7 and MCL Sec. 450.3137 according to the terms of the Certificates.(c) Any surplus Co-op assets remaining after full implementation of the Plan adopted by the Members pursuant to Bylaw Sec. 11.2, and the other requirements of Bylaw Section 11.2.4, shall be distributed to (i) those patrons who have been Members at any time during not less than the 6 years preceding dissolution or since formation of the Cooperative, whichever is less, on the basis of patronage during that period; (ii) any other cooperative, foreign cooperative, or nonprofit organization designated by membership resolution; or (iii) both.
11.2.5 Distribution of Assets as Planned by the Cooperative
Any remaining assets may be distributed to such persons, societies, organizations, domestic or foreign cooperatives, or domestic or foreign business cooperatives, as may be specified in a plan of distribution adopted by the Cooperative.
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11.2.6 Distribution of Assets without Governing Provisions
When there is no provision for the distribution of assets, the assets remaining after implementation of the provisions of this section shall escheat to the state.
11.3 Special Meeting to Dissolve the Cooperative
Any proposed dissolution shall be submitted for approval at a meeting of Members and shall follow the provisions required for notice and voting for an amendment of the Articles of Incorporation in Bylaws Section 14.2. Notice shall be given to each Member of record entitled to vote at the meeting as provided in Bylaws Sec. 14.2, shall state that a purpose of the meeting is to vote on dissolution of the Cooperative, and shall include a copy or summary of the plan for distribution of assets.
11.4 Special Vote to Dissolve the Cooperative
At the meeting a vote of Members shall be taken on the proposed dissolution and plan of distribution of assets. The dissolution shall be approved upon receiving the affirmative vote of the majority of all the Members of the Cooperative entitled to vote thereon (whether or not they vote), and if a class is entitled to vote thereon as a class, the affirmative vote of a majority of the outstanding Members of each such class.
11.5 Certificate of Dissolution
If the dissolution is approved, a certificate of dissolution shall be executed and filed on behalf of the Cooperative, setting forth:
(a) The name of the Cooperative.
(b) The date and place of the meeting of Members, or directors approving the dissolution.
(c) A statement that dissolution was approved by the requisite vote of directors and Members.
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Section 12 Effects of Amendments to Articles and Bylaws on Legal Sale of Co-op Assets
Pursuant to MCL Sec. 450.3148:
12.1 Ownership Rights under Execution or in the Course of Bankruptcy
The purchase or sale of any Member Capital or privileges in the Cooperative made under execution, or in the course of bankruptcy proceedings, or by any legal process or by operation of law, shall not give any person any membership right, title, or interest in the Cooperative, unless in accordance with the Articles or Bylaws of the Cooperative.
12.2 Certificate Pledges Not Subject to Amendment to Bylaws or Articles
No subsequent amendment to the articles or Bylaws shall invalidate or otherwise impair a pledge of a Certificate issued under Bylaw Sec. 7 or MCL Sec. 450.3136 or an assignment of a proprietary lease or other agreement providing for occupancy of facilities furnished by the Cooperative, if the pledge or assignment was made when the Articles or Bylaws expressly permitted the pledge or assignment in connection with loans made to Members.
Section 13 Indemnification and Insurance
The Co-op shall indemnify, to the greatest extent permitted by law, any officer, director, employee or volunteer of the Co-op, for expenses and costs actually and necessarily incurred in connection with any claim asserted by reason of the person being or having been such officer, Director, or employee or volunteer, except in relation to matters of negligence, fraud, criminal acts, or intentional misconduct in respect of the matter in which indemnity is sought. The Co-op shall carry appropriate liability insurance to protect its officers, Directors, employees, volunteers and the Co-op itself against the costs of such indemnification.
13.1 Scope of Indemnification
The Cooperative shall indemnify to the fullest extent authorized or permitted by the Michigan Nonprofit Corporation Act, MCL 450.2101 et seq . , any person, or the person’s estate or personal representative, who is made or threatened to be made a party to an action, suit, or proceeding (whether civil, criminal, administrative, or investigative) because the person is or was a director or an officer of the Cooperative or serves or served in any other enterprise at the request of the Cooperative. Persons who are not directors or officers of the Cooperative may be similarly indemnified in respect of services rendered to the Cooperative or at the request of the
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Cooperative to the extent authorized at any time by the Board of Directors of the Cooperative. The provisions of this section shall apply to directors and officers who have ceased to render service and shall inure to the benefit of their heirs, personal representatives, executors, and administrators. This right of indemnify shall not be exclusive, and the Cooperative may indemnify any person including volunteers, by agreement or otherwise, on whatever terms and conditions the Board of Directors of the Cooperative approves. Any agreement for the indemnification of any director, officer, employee, or other person may provide indemnification rights that are broader or otherwise different than those set forth in the Michigan Nonprofit Corporation Act, unless otherwise prohibited by law.
13.2 Authorization of Indemnification
Any indemnification under this section 13 (unless ordered by a court) shall be made by the Cooperative only when authorized in the specific case on a determination that indemnification of the director, officer, employee, or agent is proper in the circumstances because that person has met the applicable standard of conduct set forth in this section and after 10 days’ written notice to all Members of the facts surrounding the request for indemnification. The determination shall be made (a) by the Board of Directors by a majority vote of a quorum consisting of directors who were not parties to the action, suit, or proceeding; (b) if a quorum is not obtainable or, even if obtainable, when a quorum of disinterested directors directs, by independent legal counsel (who may be the regular counsel of the Cooperative) in a written opinion; or (c) by the Members by a majority vote of a quorum at a meeting of the Members.
13.3 Advancing of Expenses Related to Suits and Actions
The Cooperative may pay expenses incurred in defending a civil or criminal action, suit, or proceeding described in section 13 in advance of the final disposition of the action, suit, or proceeding as authorized by the Board of Directors on receipt of an agreement by or on behalf of the director, officer, employee, or agent to repay the amount unless it is ultimately determined that the person is entitled to be indemnified by the Cooperative as authorized in this section.
13.4 Insurance
The Cooperative may purchase and maintain insurance on behalf of any person who is or was a director, an officer, an employee, a volunteer or an agent of the Cooperative or who is or was serving at the request of the Cooperative as a director, an officer, an employee, volunteer or an agent of another Cooperative, partnership, joint venture, trust, or other enterprise against any liability asserted against that person and incurred by that person in any capacity for the Cooperative or arising out of that status, whether or not the Cooperative would have the power to indemnify that person against the liability under the provisions of this section.
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Section 14 Adoption and Amendment
14.1 Bylaws Adoption and Amendment
Initial adoption of these Bylaws shall be by a majority vote of the Board of Directors. These Bylaws may be amended at any time. Amendments may be proposed by the Board of Directors, a majority of the Members’ Assembly, or by a petition of 25 Members. Bylaws amendments must be approved at a Members’ Assembly by a 2/3 majority of Members present at a properly noticed meeting, with a quorum, of the Members Assembly and if less than a majority of all Members attended that Assembly, then a referendum vote shall be held pursuant to Bylaws Section 4.3.6 and 4.3.7. The amendment will only pass if approved by a 2/3 majority of the greatest number of Members voting, whether at the meeting or in the ratification referendum. Adequate notice for any meeting or referendum at which amendment of the Bylaws is to be considered means that notice of the time, place, and object of the meeting, including the purpose of the proposed amendment to be considered, was given by mail, in person or by electronic transmission for which a delivery receipt is obtained, at the last known address, to each Member entitled to vote at least 20 days before the date of the meeting or by publication in a publication distributed by the Members at least 20 days before the date of the meeting.
14.2 Adoption and Amendment of the Articles of Incorporation
Before the first meeting of the board, the incorporators may amend the Articles of Incorporation by complying with MCL Sec. 450.2 631(1). The initial Articles of Incorporation shall be adopted by the majority vote of the initial board of directors named in the Articles, who shall serve as the first board of directors until the first annual meeting of Members. Thereafter, an amendment to the Articles of Incorporation may be proposed by the Board, a majority of the Members’ Assembly, or by a petition of 25 members. If proposed by the number of Members required for calling a special meeting pursuant to Bylaws Sec. 4.3.4, a special meeting shall be called within a reasonable time. If proposed by less than the number of Members required to call a special meeting, then the proposed amendment shall be considered at the next annual or special meeting. Except for amendments that would alter membership qualification or voting rights, which must be approved pursuant to the rules of Article XII of the Articles of Incorporation, the Articles may be amended by the affirmative vote of not less than a 2/3 majority of the Active Members at a Members’ Assembly for which adequate notice has been given and quorum attained, and if less than a majority of all members attended that Assembly, then a referendum vote shall be held pursuant to Bylaws Section 4.3.6 and 4.3.7. The amendment will only pass if approved by a 2/3 majority of the greatest number of Members voting, whether at the meeting or in the ratification referendum. Adequate notice for any meeting or ratification referendum at which amendment of the Articles of Incorporation is to
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be considered means that notice of the time, place, and object of the meeting, including the purpose of the proposed amendment to be considered, was given by mail, in person or by electronic transmission for which a delivery receipt is obtained, at the last known address, to each Member entitled to vote at least 20 days before the date of the meeting or by publication in a publication distributed by the Members at least 20 days before the date of the meeting. In no event shall any amendment make changes in the qualifications for membership or the voting rights of members except by the affirmative vote of not less than a 2/3 majority of the entire membership of the co-op and a 2/3 majority vote of the entire membership of each class of members whose rights are the subject of change, whether these votes are taken at a duly noticed meeting or referendum.
Section 15 Miscellaneous
15.1 Severability
if any section, clause, provision, or portion of these Bylaws is adjudged unconstitutional or invalid by a court of competent jurisdiction, the remainder of these Bylaws shall not be affected thereby.
15.2 Bylaw Provision Control
To the extent that the section 1 of these Bylaws entitled ”High Five Co-op Brewery Values Principles” conflict with the bylaw provisions contained in Section 2 through 15 hereof, the bylaw provisions in Section 2 through 15 shall control.
15.3 Conflict Resolution
Conflicts shall be resolved according to the Conflict Resolution policy as set forth by the Board of Directors. Unless and until the following is changed in the Operating Rules, this may include a dispute resolution body within the Co-op that shall attempt to settle disputes between the Cooperative and any of its Members. It shall be composed of individuals who are approved by both parties to the dispute, which individuals may be Members or nonmembers, but not officers or directors of the Cooperative. However, the policy shall also provide that an outside conflict resolution body may be sought by any Member involved in the conflict who is not satisfied with the internal mechanism, provided that Member agrees to pay for all related costs and all parties to the dispute agree upon the external conflict resolution body and its decision makers.
15.4 Democratic Rules of 0rder
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Meetings shall be conducted using The Democratic Rules of Order.
15.5 Books and Records, Mailings, Contact Between Members Regarding Proposals
15.5.1 Written Accounting Records and Reports
The Cooperative shall keep a set of books for recording its operations. A written report, including a statement of the amount of its transactions with Members and the amount of its transactions with nonmember patrons, expense reimbursements to Board members, a balance sheet, and an income statement shall be prepared annually.
15.5.2 Year End Closing of Accounts
The Cooperative shall prepare, not later than 120 days after the close of its fiscal year, a report of its condition, which report shall be certified by the president. The report shall include all of the following:
(a) The name and principal address of the Cooperative.
(b) The names, addresses, and date of expiration of terms of the officers and directors, and their rate of compensation, if any.
(c) The number of memberships granted and terminated and the amount of Member Capital paid in during the fiscal year.
15.5.3 Presentation of Reports to Membership
A copy of the reports required by this section shall be presented at the annual Members’ Assembly meeting or distributed to each Member. Copies of the report shall be kept on file at the principal office of the Cooperative and shall be made available to Members and applicants for membership during regular business hours. In addition, copies of the report shall be mailed to a Member upon written request by the Member.
15.5.4 Regarding Use of Membership Lists by Members
If a membership address list is not accessible to Members, then any mailing reasonably related to the affairs of the membership shall be made by the Cooperative at the request and expense of a Member.
15.5.5 Facilitation of Communication between Members
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If a Member makes a timely request in writing that the Cooperative notify the membership of the Member's desire to be contacted by other Members regarding a proposal then pending for vote by the membership, the Cooperative shall include in the next communication sent by the Cooperative to all Members, if any, a brief notice of that Member's request which shall identify the Member and shall state whether the Member is for or against the proposal and how to contact that Member.
15.6 Affiliation with Other Organizations Involving Cooperative Assets
Pursuant to MCL Sec. 450.3153, a vote of the membership shall be required to affiliate with another organization involving the investment of more than 30% of the assets of the Cooperative, if the affiliation is not in the usual and regular course of its business. This section shall not apply to any allocations of Net Savings to the Cooperative by any person.
