1.Generally. A membership interest is personal property. A member has no interest in
specific cooperative property. All property of the cooperative is property of the cooperative.
2.Statementofmembershipinterest. Attherequestofanymember,thecooperativeshall
state in writing the particular membership interest owned by that member as of the date the
cooperativemakesthestatement. Thestatementmustdescribethemember’srightstovote, if
any, to share in profits and losses, and to share in distributions, restrictions on assignments of
financialrightsundersection501A.902, subsection3, orvotingrightsundersection501A.810
then in effect, as well as any assignment of the member’s rights then in effect other than a
security interest.
3.Terms of membership interests. All the membership interests of a coo
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1. Generally. A membership interest is personal property. A member has no interest in
specific cooperative property. All property of the cooperative is property of the cooperative.
2. Statementofmembershipinterest. Attherequestofanymember,thecooperativeshall
state in writing the particular membership interest owned by that member as of the date the
cooperativemakesthestatement. Thestatementmustdescribethemember’srightstovote, if
any, to share in profits and losses, and to share in distributions, restrictions on assignments of
financialrightsundersection501A.902, subsection3, orvotingrightsundersection501A.810
then in effect, as well as any assignment of the member’s rights then in effect other than a
security interest.
3. Terms of membership interests. All the membership interests of a cooperative are
subject to all of the following:
a. Membership interests shall be of one class, without series, unless the articles or bylaws
establish or authorize the board to establish more than one class or series within classes.
b. Ordinary patron membership interests and, if authorized, nonpatron membership
interests subject to this chapter are entitled to vote as provided in section 501A.810, and
have equal rights and preferences in all matters not otherwise provided for by the board
and to the extent that the articles or bylaws have fixed the relative rights and preferences
of different classes and series.
c. Membership interests share profits and losses and are entitled to distributions as
provided in sections 501A.1005 and 501A.1006.
4. Rights of judgment creditor. On application to a court of competent jurisdiction by any
judgment creditor of a member, the court may charge a member’s or an assignee’s financial
rights with payment of the unsatisfied amount of the judgment with interest. To the extent
so charged, the judgment creditor has only the rights of an assignee of a member’s financial
rights under section 501A.902. This chapter does not deprive any member or assignee of
financial rights of the benefit of any exemption laws applicable to the membership interest.
This section is the sole and exclusive remedy of a judgment creditor with respect to the
judgment debtor’s membership interest.
5. Establishment of class or series.
a. Subjecttoanyrestrictionsinthearticlesorbylaws,thepowergrantedinthissubsection
may be exercised by a resolution or resolutions establishing a class or series, setting forth the
designation of the class or series, and fixing the relative rights and preferences of the class
or series. Any of the rights and preferences of a class or series established in the articles,
bylaws, or by resolution of the board may do any of the following:
(1) Be made dependent upon facts ascertainable outside the articles or bylaws or outside
the resolution or resolutions establishing the class or series, if the manner in which the facts
operateupontherightsandpreferencesoftheclassorseriesisclearlyandexpresslysetforth
in the articles or bylaws or in the resolution or resolutions establishing the class or series.
(2) Include by reference some or all of the terms of any agreements, contracts, or other
arrangements entered into by the cooperative in connection with the establishment of
the class or series if the cooperative retains at its principal executive office a copy of the
agreements, contracts, or other arrangements or the portions will be included by reference.
b. A statement setting forth the name of the cooperative and the text of the resolution
and certifying the adoption of the resolution and the date of adoption must be given to the
membersbeforetheacceptanceofanycontributionsforwhichtheresolutioncreatesrightsor
preferencesnotsetforthinthearticlesorbylaws. Wherethemembershavereceivednoticeof
the creation of membership interests with rights or preferences not set forth in the articles or
bylaws before the acceptance of the contributions with respect to the membership interests,
the statement may be filed anytime within one year after the acceptance of the contributions.
The resolution is effective three days after delivery to the members is deemed effective by the
board, or, if the statement is not required to be given to the members before the acceptance
of contributions, on the date of its adoption by the directors.
6. Specific terms. Without limiting the authority granted in this section, in regulating the
membership interests of a class or series, a cooperative may do any of the following:
43 COOPERATIVE ASSOCIATIONS ACT, §501A.904
a. Subject to the right of the cooperative, redeem any of those membership interests at
the price fixed for their redemption by the articles or bylaws or by the board.
b. Entitle the members to receive cumulative, partially cumulative, or noncumulative
distributions.
c. Provide a preference over any class or series of membership interests for the payment
of distributions of any or all kinds.
d. Convert membership interests into any other class or any series of the same or another
class.
e. Provide full, partial, or no voting rights, except as provided in section 501A.810.
7. Grant of a security interest. For the purpose of any law relating to security interests,
membership interests, governance or voting rights, and financial rights are each to be
characterized as provided in section 554.8103, subsection 3.
8. Powers of estate of a deceased or incompetent member.
a. If a member who is an individual dies or a court of competent jurisdiction adjudges the
member to be incompetent to manage the member’s person or property, or an order for relief
under the bankruptcy code is entered with respect to the member, the member’s executor,
administrator, guardian, conservator, trustee, or other legal representative may exercise all
of the member’s rights for the purpose of settling the estate or administering the member’s
property. Ifamemberisabusinessentity,trust,orotherentityandisdissolved,terminated,or
placed by a court in receivership or bankruptcy, the powers of that member may be exercised
by its legal representative or successor.
b. If an event referred to in paragraph “a” causes the termination of a member’s
membership interest and the termination does not result in dissolution, then, subject to the
articles and bylaws, all of the following apply:
(1) As provided in section 501A.902, the terminated member’s interest will be considered
to be merely that of an assignee of the financial rights owned before the termination of
membership.
(2) The rights to be exercised by the legal representative of the terminated member shall
be limited accordingly.
9. Liability of subscribers and members with respect to membership interests. A person
who subscribes to or owns a membership interest in a cooperative is under no obligation
to the cooperative or its creditors with respect to the membership interests subscribed for
or owned, except to pay to the cooperative the full consideration for which the membership
interests are issued or to be issued.