2023 New York Laws › CCO - Cooperative Corporations › Article 1 - Short Title; Policy; Definitions › 5 - Applicability of Business Corporation Law to Cooperative Corporations.

§   5.  Applicability  of  business  corporation  law  to  cooperative
corporations.  1.  The  business  corporation  law  applies   to   every
corporation  heretofore or hereafter formed under this chapter, or under
any other statute or special act of this state, or under laws other than
the statutes of this state, which  has  as  its  purpose  or  among  its
purposes  the  cooperative  rendering  of mutual help and service to its
members and which, if formed under laws other than the statutes of  this
state,  would,  if it were to be formed currently under the laws of this
state, be formed under this chapter except a membership  cooperative  as
defined  in  section  three of this chapter, to which the not-for-profit
corporation law shall apply.  Any  corporation  to  which  the  business
corporation law is made applicable by this section shall be treated as a
"corporation," "domestic corporation," or "foreign corporation," as such
terms  are used in the business corporation law; provided, however, that
neither the purposes for which any such corporation may be formed  under
this  chapter  nor  its classification as a non-profit corporation shall
thereby  be  extended  or  affected.  Any  corporation  to   which   the
not-for-profit  corporation law is made applicable by this section shall
be a type D not-for-profit corporation.
(a) If any provision of the business corporation  law  conflicts  with
any  provision  of  this  chapter,  the  provision of this chapter shall
prevail, and the conflicting provision of the business  corporation  law
shall  not  apply in such case. If any provision of this chapter relates
to a matter embraced in the business  corporation  law  but  is  not  in
conflict therewith, both provisions shall apply.
(b) The following provisions of the business corporation law shall not
apply  to cooperative corporations: section two hundred one (a), section
four hundred three, the final clause of section  five  hundred  one  (a)
which  reads "and no limitation or definition of dividend or liquidation
rights shall be effective unless at the time  one  or  more  classes  of
outstanding  shares,  singly  or  in  the  aggregate,  are  entitled  to
unlimited dividend and liquidation rights", section five  hundred  five,
section  five  hundred  eighteen  (c), section six hundred eight (a) and
(b), section six hundred nine, section six hundred fourteen (a), section
six hundred  eighteen,  section  six  hundred  twenty-one,  section  six
hundred  twenty-two,  section six hundred thirty (a) (except as provided
in section forty-seven of this chapter),  section  seven  hundred  three
(a), section seven hundred four, and section eight hundred three (a).
(c) In  applying the business corporation law to non-stock cooperative
corporations,  unless  the  context  requires   otherwise,   the   terms
"shareholder"  and "holder of shares" shall mean "member," and the terms
"shareholders" and "holders of shares" shall mean "members".
(d) In applying the business corporation law to  corporations  subject
to  this  chapter,  unless the context requires otherwise, references to
the holders of a stated  percentage  or  fraction  of  "all  outstanding
shares,"  "all outstanding shares entitled to vote thereon," "the shares
entitled to vote," and "the outstanding shares, whether or not  entitled
to vote," shall mean the stated percentage or fraction of the members or
delegates  present  and  voting;  provided, however, that this paragraph
shall not apply to shares of stock not evidencing membership.
2. For the purpose of this section and elsewhere in this chapter,  the
effective date of the business corporation law shall be September first,
nineteen hundred sixty-seven.
3. Sections  five  hundred  eight  and  five  hundred  fifteen  of the
not-for-profit corporation law notwithstanding, a membership cooperative
shall be permitted to distribute any portion or all of its net  retained
proceeds to its members pro rata on the basis of their patronage.