At least once a year the members and/or the directors, as the articles or by-laws [bylaws] may provide, shall apportion the net savings of the association in the following order:
A. not less than ten percent (10%) shall be placed in a surplus fund until such time as the fund shall equal at least fifty percent (50%) of the paid-up capital;
B. interest-dividends, within the limitations of Section 22 [53-4-22 NMSA 1978] may be paid upon share capital, or, if the by-laws [bylaws] so provide, upon the membership certificates of a nonshare association;
C. a portion of the remainder, as determined by the articles or by-laws [bylaws], shall be allocated to an educational fund to be used in teaching cooperation, and a portion may also be allocated to funds for the general welfare of the members of the association;
D. the remainder shall be allocated at the same uniform rate to all patrons of the association in proportion to their individual patronage, provided that:
(1) in the case of a member patron, his proportionate amount of savings return shall be distributed to him;
(2) in the case of a subscriber, his proportionate amount of savings return may, as the articles or by-laws [bylaws] provide, be distributed to him or credited to his account until the amount of capital subscribed for has been fully paid;
(3) in the case of nonmember patrons their proportionate amount of savings returns shall be set aside in a general fund for such patrons and shall be allocated to individual nonmember patrons only upon request and presentation of evidence of the amount of their patronage. Any savings return so allocated shall be credited to such patron towards payment of the minimum amount of share or membership capital necessary for membership. When a sum equal to this amount has been accumulated at any time within a period of time specified in the by-laws [bylaws], such patron shall be deemed and become a member of the association if he so agrees or requests, and complies with any provisions in the bylaws for admission to membership. The certificates of shares or membership to which he is entitled shall then be issued to him;
(4) if within any periods of time specified in the articles or by-laws [bylaws], (a) any subscriber has not accumulated and paid in the amount of capital subscribed for; or (b) any nonmember patron has not accumulated in his individual account the sum necessary for membership; or (c) any nonmember patron has accumulated the sum necessary for membership but does not request or agree to become a member or fails to comply with the provisions of the bylaws, if any, for admission to membership, then: the amounts so accumulated or paid in and any part of the general fund for nonmember patrons, which has not been allocated to individual nonmember patrons, shall go to the educational fund and thereafter no member or other patron shall have any rights in said paid in [paid-in] capital or accumulated savings returns as such.
History: Laws 1939, ch. 164, § 31; 1941 Comp., § 54-1431; 1953 Comp., § 51-15-31.
Bracketed material. — The bracketed material was inserted by the compiler and is not part of the law.
Am. Jur. 2d, A.L.R. and C.J.S. references. — 18 Am. Jur. 2d Cooperative Associations § 22; 18B Am. Jur. 2d Corporations §§ 1168, 1169.
Distribution of funds by nonprofit corporation absent dissolution, 51 A.L.R.3d 1318.
18 C.J.S. Corporations §§ 293 to 304.
Structure New Mexico Statutes
Article 4 - Cooperative Associations
Section 53-4-1.1 - Short title.
Section 53-4-2 - Who may incorporate.
Section 53-4-5 - Articles of incorporation; contents.
Section 53-4-6 - Articles of incorporation; filing; recordation; fees.
Section 53-4-6.1 - Registered office and registered agent.
Section 53-4-6.2 - Change of registered office or registered agent.
Section 53-4-6.3 - Service of process on association.
Section 53-4-6.4 - Recompiled.
Section 53-4-7 - Articles of incorporation; amendments; fee.
Section 53-4-8 - Adoption, amendment, or repeal of by-laws [bylaws].
Section 53-4-9 - Contents of by-laws [bylaws].
Section 53-4-9.1 - Indemnification of officers and directors.
Section 53-4-10 - Regular and special meetings.
Section 53-4-11 - Notice of meeting.
Section 53-4-12 - Meetings by units of the membership.
Section 53-4-13 - One member - one vote.
Section 53-4-15 - Voting by mail.
Section 53-4-16 - Application of voting provisions herein to voting by mail.
Section 53-4-17 - Application of voting provisions herein to voting by delegates.
Section 53-4-18.1 - Duties of directors.
Section 53-4-18.2 - Liability of directors.
Section 53-4-20 - Removal of directors and officers.
Section 53-4-21.1 - Disposition of property.
Section 53-4-22 - Limitations on interest-dividends.
Section 53-4-23 - Eligibility and admission to membership.
Section 53-4-24 - Subscribers.
Section 53-4-25 - Share and membership certificates; issuance and contents.
Section 53-4-26 - Transfer of shares and membership; withdrawal.
Section 53-4-27 - Share and membership certificates; recall.
Section 53-4-28 - Share and membership certificates; attachment.
Section 53-4-29 - Liability of members.
Section 53-4-31 - Allocation and distribution of net savings.
Section 53-4-33 - Books; auditing.
Section 53-4-34 - Annual report.
Section 53-4-35 - Notice of delinquent reports; forfeitures; reinstatement.
Section 53-4-36 - Voluntary dissolution.
Section 53-4-37 - Use of name "cooperative"; penalty.
Section 53-4-38 - Promotion expenses; limitations; penalty.
Section 53-4-39 - Spreading false reports; penalty.
Section 53-4-40 - Existing cooperative corporations.
Section 53-4-41 - Foreign corporations.
Section 53-4-42 - Legality declared; not in restraint of trade.
Section 53-4-43 - Laws not applicable.