reglab/statecodes huggingface dataset:
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 2 - Filing and Annual Reports › § 204. Correcting filed record

§ 204. Correcting filed record
(a) A mutual benefit enterprise or foreign enterprise may deliver to the Secretary of State for filing a statement of correction to correct a record previously delivered by the enterprise or foreign enterprise to the Secretary of State and filed by the Secretary of State if, at the time of filing, the record contained inaccurate information or was defectively signed.
(b) A statement of correction may not state a delayed effective date and shall:
(1) describe the record to be corrected, including its filing date, or have attached a copy of the record as filed;
(2) specify the inaccurate information and the reason it is inaccurate or the manner in which the signing was defective; and
(3) correct the inaccurate information or defective signature.
(c) When filed by the Secretary of State, a statement of correction is effective:
(1) when filed as to persons relying on the inaccurate information or defective signature before its correction and adversely affected by the correction; and
(2) as to all other persons, retroactively as of the effective date and time of the record the statement corrects. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 2 - Filing and Annual Reports › § 205. Liability for inaccurate information in filed record

§ 205. Liability for inaccurate information in filed record
If a record delivered to the Secretary of State for filing under this title and filed by the Secretary of State contains inaccurate information, a person that suffers a loss by reliance on the information may recover damages for the loss from a person that signed the record or caused another to sign it on the person’s behalf and knew at the time the record was signed that the information was inaccurate. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 2 - Filing and Annual Reports › § 206. Certificate of good standing or authorization

§ 206. Certificate of good standing or authorization
(a) The Secretary of State, upon request and payment of the required fee, shall furnish any person that requests it a certificate of good standing for a mutual benefit enterprise if the records filed in the Office of the Secretary of State show that the Secretary of State has filed the enterprise’s articles of organization, that the enterprise is in good standing, and that the Secretary of State has not filed a statement of termination.
(b) The Secretary of State, upon request and payment of the required fee, shall furnish to any person that requests it a certificate of authority for a foreign enterprise if the records filed in the Office of the Secretary of State show that the Secretary of State has filed the foreign enterprise’s certificate of authority, has not revoked nor has reason to revoke the certificate of authority, and has not filed a notice of cancellation.
(c) Subject to any exceptions stated in the certificate, a certificate of good standing or authority issued by the Secretary of State establishes conclusively that the mutual benefit enterprise or foreign enterprise is in good standing or is authorized to transact business in this State. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 2 - Filing and Annual Reports › § 207. Annual report for Secretary of State

§ 207. Annual report for Secretary of State
(a) A mutual benefit enterprise or foreign enterprise authorized to transact business in this State shall deliver to the Secretary of State for filing an annual report that states:
(1) the name of the enterprise or foreign enterprise;
(2) the street address and, if different, mailing address of the enterprise’s or foreign enterprise’s designated office and the name of its agent for service of process at the designated office;
(3) the street address and, if different, mailing address of the enterprise’s or foreign enterprise’s principal office;
(4) the name and business address of any director or officer; and
(5) in the case of a foreign enterprise, the state or other jurisdiction under whose law the foreign enterprise is formed and any alternative name adopted under section 1405 of this title.
(b) Information in an annual report shall be current as of the date the report is delivered to the Secretary of State.
(c) A mutual benefit enterprise or foreign enterprise authorized to transact business in this State shall deliver its annual report to the Secretary for filing between January 1 and April 1 of each year, beginning in the year following the calendar year in which the mutual benefit enterprise is formed or the foreign enterprise is authorized to transact business in this State.
(d) If an annual report does not contain the information required by subsection (a) of this section, the Secretary of State shall promptly notify the reporting mutual benefit enterprise or foreign enterprise and return the report for correction. If the report is corrected to contain the information required by subsection (a) of this section and delivered to the Secretary of State not later than 30 days after the date of the notice from the Secretary of State, it is timely delivered.
(e) If a filed annual report contains an address of the designated office, the name or business address of a director or officer, or address of the principal office which differs from the information shown in the records of the Secretary of State immediately before the filing, the differing information in the annual report is considered a statement of change.
(f) If a mutual benefit enterprise fails to deliver an annual report under this section, the Secretary of State may proceed under section 1211 of this title to dissolve the enterprise administratively.
(g) If a foreign enterprise fails to deliver an annual report under this section, the Secretary of State may revoke the certificate of authority of the enterprise. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 2 - Filing and Annual Reports › § 208. Filing fees

§ 208. Filing fees
The filing fees for records filed under this article by the Secretary of State are the same as those set forth for a limited liability company under 11 V.S.A. § 3013. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 3 - Formation and Initial Articles of Organization of Mutual Benefit Enterprise › § 301. Organizers

§ 301. Organizers
A mutual benefit enterprise shall be organized by one or more organizers. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 3 - Formation and Initial Articles of Organization of Mutual Benefit Enterprise › § 302. Formation of mutual benefit enterprise; articles of organization

§ 302. Formation of mutual benefit enterprise; articles of organization
(a) To form a mutual benefit enterprise, an organizer of the enterprise shall deliver articles of organization to the Secretary of State for filing. The articles shall state:
(1) the name of the enterprise;
(2) the purposes for which the enterprise is formed;
(3) the street address and, if different, mailing address of the enterprise’s initial designated office and the name of the enterprise’s initial agent for service of process at the designated office;
(4) the street address and, if different, mailing address of the initial principal office;
(5) the name and street address and, if different, mailing address of each organizer; and
(6) the term for which the enterprise is to exist if other than perpetual.
(b) Subject to subsection 113(a) of this title, articles of organization may contain any other provisions in addition to those required by subsection (a) of this section.
(c) A mutual benefit enterprise is formed after articles of organization that substantially comply with subsection (a) of this section are delivered to the Secretary of State, are filed, and become effective under subsection 203(c) of this title.
(d) If articles of organization filed by the Secretary of State provide for a delayed effective date, a mutual benefit enterprise is not formed if, before the articles take effect, an organizer signs and delivers to the Secretary of State for filing a statement of cancellation. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 3 - Formation and Initial Articles of Organization of Mutual Benefit Enterprise › § 303. Organization of mutual benefit enterprise

§ 303. Organization of mutual benefit enterprise
(a) After a mutual benefit enterprise is formed:
(1) if initial directors are named in the articles of organization, the initial directors shall hold an organizational meeting to adopt initial bylaws and carry on any other business necessary or proper to complete the organization of the enterprise; or
(2) if initial directors are not named in the articles of organization, the organizers shall designate the initial directors and call a meeting of the initial directors to adopt initial bylaws and carry on any other business necessary or proper to complete the organization of the enterprise.
(b) Unless the articles of organization otherwise provide, the initial directors may cause the mutual benefit enterprise to accept members, including those necessary for the enterprise to begin business.
(c) Initial directors need not be members.
(d) An initial director serves until a successor is elected and qualified at a members’ meeting or the director is removed, resigns, is adjudged incompetent, or dies. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 3 - Formation and Initial Articles of Organization of Mutual Benefit Enterprise › § 304. Bylaws

§ 304. Bylaws
(a) Bylaws shall be in a record and, if not stated in the articles of organization, shall include:
(1) a statement of the capital structure of the mutual benefit enterprise, including:
(A) the classes or other types of members’ interests and relative rights, preferences, and restrictions granted to or imposed upon each class or other type of member’s interest; and
(B) the rights to share in profits or distributions of the enterprise;
(2) a statement of the method for admission of members;
(3) a statement designating voting and other governance rights, including which members have voting power and any restriction on voting power;
(4) a statement that a member’s interest is transferable if it is to be transferable and a statement of the conditions upon which it may be transferred;
(5) a statement concerning the manner in which profits and losses are allocated and distributions are made among patron members and, if investor members are authorized, the manner in which profits and losses are allocated and how distributions are made among investor members and between patron members and investor members;
(6) a statement concerning:
(A) whether persons who are not members but who conduct business with the enterprise may be permitted to share in allocations of profits and losses and receive distributions; and
(B) the manner in which profits and losses are allocated and distributions are made with respect to those persons; and
(7) a statement of the number and terms of directors or the method by which the number and terms are determined.
(b) Subject to subsection 113(c) of this title and the articles of organization, bylaws may contain any other provision for managing and regulating the affairs of the enterprise.
(c) In addition to amendments permitted under article 4 of this title, the initial board of directors may amend the bylaws by a majority vote of the directors at any time before the admission of members. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 4 - Amendment of Organic Rules of Mutual Benefit Enterprise › § 401. Authority to amend organic rules

§ 401. Authority to amend organic rules
(a) A mutual benefit enterprise may amend its organic rules under this article for any lawful purpose. In addition, the initial board of directors may amend the bylaws of an enterprise under section 304 of this title.
(b) Unless the organic rules otherwise provide, a member does not have a vested property right resulting from any provision in the organic rules, including a provision relating to the management, control, capital structure, distribution, entitlement, purpose, or duration of the mutual benefit enterprise. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 4 - Amendment of Organic Rules of Mutual Benefit Enterprise › § 402. Notice and action on amendment of organic rules

§ 402. Notice and action on amendment of organic rules
(a) Except as provided in subsections 401(a) and 405(f) of this title, the organic rules of a mutual benefit enterprise may be amended only at a members’ meeting. An amendment may be proposed by either:
(1) a majority of the board of directors or a greater percentage if required by the organic rules; or
(2) one or more petitions signed by at least 10 percent of the patron members or at least 10 percent of the investor members.
(b) The board of directors shall call a members’ meeting to consider an amendment proposed pursuant to subsection (a) of this section. The meeting shall be held not later than 90 days following the proposal of the amendment by the board or receipt of a petition. The board shall mail or otherwise transmit or deliver in a record to each member:
(1) the proposed amendment or a summary of the proposed amendment and a statement of the manner in which a copy of the amendment in a record may be reasonably obtained by a member;
(2) a recommendation that the members approve the amendment or, if the board determines that because of conflict of interest or other special circumstances it should not make a favorable recommendation, the basis for that determination;
(3) a statement of any condition of the board’s submission of the amendment to the members; and
(4) notice of the meeting at which the proposed amendment will be considered, which shall be given in the same manner as notice for a special meeting of members. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 4 - Amendment of Organic Rules of Mutual Benefit Enterprise › § 403. Method of voting on amendment of organic rules

§ 403. Method of voting on amendment of organic rules
(a) A substantive change to a proposed amendment of the organic rules may not be made at the members’ meeting at which a vote on the amendment occurs.
(b) A nonsubstantive change to a proposed amendment of the organic rules may be made at the members’ meeting at which the vote on the amendment occurs and need not be separately voted upon by the board of directors.
(c) A vote to adopt a nonsubstantive change to a proposed amendment to the organic rules shall be by the same percentage of votes as is required to pass a proposed amendment. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 4 - Amendment of Organic Rules of Mutual Benefit Enterprise › § 404. Voting by district, class, or voting group

§ 404. Voting by district, class, or voting group
(a) This section applies if the organic rules provide for voting by district or class or if there is one or more identifiable voting groups that a proposed amendment to the organic rules would affect differently from other members with respect to matters identified in subdivisions 405(e)(1) through (5) of this title. Approval of the amendment requires the same percentage of votes of the members of that district, class, or voting group required in sections 405 and 514 of this title.
(b) If a proposed amendment to the organic rules would affect members in two or more districts or classes entitled to vote separately under subsection (a) of this section in the same or a substantially similar way, the districts or classes affected shall vote as a single voting group unless the organic rules otherwise provide for separate voting. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 4 - Amendment of Organic Rules of Mutual Benefit Enterprise › § 406. Restated articles of organization

§ 406. Restated articles of organization
A mutual benefit enterprise, by the affirmative vote of a majority of the board of directors taken at a meeting for which the purpose is stated in the notice of the meeting, may adopt restated articles of organization that contain the original articles as previously amended. Restated articles may contain amendments if the restated articles are adopted in the same manner and with the same vote as required for amendments to the articles under subsection 405(a) of this title. Upon filing, restated articles supersede the existing articles and all amendments. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 4 - Amendment of Organic Rules of Mutual Benefit Enterprise › § 407. Amendment or restatement of articles of organization; filing

§ 407. Amendment or restatement of articles of organization; filing
(a) To amend its articles of organization, a mutual benefit enterprise shall deliver to the Secretary of State for filing an amendment of the articles or restated articles of organization or articles of conversion or merger pursuant to article 16 of this title which contain one or more amendments of the articles of organization stating:
(1) the name of the enterprise;
(2) the date of filing of the enterprise’s initial articles; and
(3) the changes the amendment makes to the articles as most recently amended or restated.
(b) Before the beginning of the initial meeting of the board of directors, an organizer who knows that information in the filed articles of organization was inaccurate when the articles were filed or has become inaccurate due to changed circumstances shall promptly:
(1) cause the articles to be amended; or
(2) if appropriate, deliver an amendment to the Secretary of State for filing pursuant to section 203 of this title.
(c) If restated articles of organization are adopted, the restated articles may be delivered to the Secretary of State for filing in the same manner as an amendment.
(d) Upon filing, an amendment of the articles of organization or other record containing an amendment of the articles which has been properly adopted by the members is effective as provided in subsection 203(c) of this title. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 5 - Members › § 502. Becoming a member

§ 502. Becoming a member
A person becomes a member:
(1) as provided in the organic rules;
(2) as the result of a merger or conversion under article 16 of this title; or
(3) with the consent of all the members. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 5 - Members › § 503. No power as member to bind enterprise

§ 503. No power as member to bind enterprise
A member solely by reason of being a member may not act for or bind the mutual benefit enterprise. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 5 - Members › § 504. No liability as member for enterprise’s obligations

§ 504. No liability as member for enterprise’s obligations
Unless the articles of organization otherwise provide, a debt, obligation, or other liability of a mutual benefit enterprise is solely that of the enterprise and is not the debt, obligation, or liability of a member solely by reason of being a member. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 5 - Members › § 506. Annual meeting of members

§ 506. Annual meeting of members
(a) Members shall meet annually at a time provided in the organic rules or set by the board of directors not inconsistent with the organic rules.
(b) An annual members’ meeting may be held inside or outside this State at the place stated in the organic rules or selected by the board of directors not inconsistent with the organic rules.
(c) Unless the organic rules otherwise provide, members may attend or conduct an annual members’ meeting through any means of communication if all members attending the meeting can communicate with each other during the meeting.
(d) The board of directors shall report or cause to be reported at the enterprise’s annual members’ meeting the enterprise’s business and financial condition as of the close of the most recent fiscal year.
(e) Unless the organic rules otherwise provide, the board of directors shall designate the presiding officer of the enterprise’s annual members’ meeting.
(f) Failure to hold an annual members’ meeting does not affect the validity of any action by the mutual benefit enterprise. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 5 - Members › § 507. Special meeting of members

§ 507. Special meeting of members
(a) A special meeting of members may be called only:
(1) as provided in the organic rules;
(2) by a majority vote of the board of directors on a proposal stating the purpose of the meeting;
(3) by demand in a record signed by members holding at least 20 percent of the voting power of the persons in any district or class entitled to vote on the matter that is the purpose of the meeting stated in the demand; or
(4) by demand in a record signed by members holding at least 10 percent of the total voting power of all the persons entitled to vote on the matter that is the purpose of the meeting stated in the demand.
(b) A demand under subdivision (a)(3) or (4) of this section shall be submitted to the officer of the mutual benefit enterprise charged with keeping its records.
(c) Any voting member may withdraw its demand under subdivision (a)(3) or (4) of this section before receipt by the mutual benefit enterprise of demands sufficient to require a special meeting of members.
(d) A special meeting of members may be held inside or outside this State at the place stated in the organic rules or selected by the board of directors not inconsistent with the organic rules.
(e) Unless the organic rules otherwise provide, members may attend or conduct a special meeting of members through the use of any means of communication if all members attending the meeting can communicate with each other during the meeting.
(f) Only business within the purpose or purposes stated in the notice of a special meeting of members may be conducted at the meeting.
(g) Unless the organic rules otherwise provide, the presiding officer of a special meeting of members shall be designated by the board of directors. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 5 - Members › § 508. Notice of members’ meeting

§ 508. Notice of members’ meeting
(a) A mutual benefit enterprise shall notify each member of the time, date, and place of a members’ meeting at least 15 and not more than 60 days before the meeting.
(b) Unless the articles of organization otherwise provide, notice of an annual members’ meeting need not include any purpose of the meeting.
(c) Notice of a special meeting of members shall include each purpose of the meeting as contained in the demand under subdivision 507(a)(3) or (4) of this title or as voted upon by the board of directors under subdivision 507(a)(2) of this title.
(d) Notice of a members’ meeting shall be given in a record unless oral notice is reasonable under the circumstances. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 5 - Members › § 509. Waiver of member’s meeting notice

§ 509. Waiver of member’s meeting notice
(a) A member may waive notice of a members’ meeting before, during, or after the meeting.
(b) A member’s participation in a members’ meeting is a waiver of notice of that meeting unless the member objects to the meeting at the beginning of the meeting or promptly upon the member’s arrival at the meeting and does not thereafter vote for or assent to action taken at the meeting. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 5 - Members › § 510. Quorum of members

§ 510. Quorum of members
Unless the organic rules otherwise require a greater number of members or percentage of the voting power, the voting member or members present at a members’ meeting constitute a quorum. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 5 - Members › § 511. Voting by patron members

§ 511. Voting by patron members
Except as provided by subsection 512(a) of this title, each patron member has one vote. The organic rules may allocate voting power among patron members as provided in subsection 512(a) of this title. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 5 - Members › § 512. Determination of voting power of patron member

§ 512. Determination of voting power of patron member
(a) The organic rules may allocate voting power among patron members on the basis of one or a combination of the following:
(1) one member, one vote;
(2) use or patronage;
(3) equity; or
(4) if a patron member is a cooperative, the number of its patron members.
(b) The organic rules may provide for the allocation of patron member voting power by districts or class or any combination thereof. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 5 - Members › § 513. Voting by investor members

§ 513. Voting by investor members
If the organic rules provide for investor members, each investor member has one vote unless the organic rules otherwise provide. The organic rules may provide for the allocation of investor member voting power by class, classes, or any combination of classes. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 5 - Members › § 514. Voting requirements for members

§ 514. Voting requirements for members
If a mutual benefit enterprise has both patron and investor members, the following rules apply:
(1) The total voting power of all patron members may not be less than a majority of the entire voting power entitled to vote.
(2) Action on any matter is approved only upon the affirmative vote of at least a majority of:
(A) all members voting at the meeting unless more than a majority is required by articles 4, 12, 15, and 16 of this title or the organic rules; and
(B) votes cast by patron members unless the organic rules require a larger affirmative vote by patron members.
(3) The organic rules may provide for the percentage of the affirmative votes that shall be cast by investor members to approve the matter. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 5 - Members › § 515. Manner of voting

§ 515. Manner of voting
(a) Unless the organic rules otherwise provide, voting by a proxy at a members’ meeting is prohibited. This subsection does not prohibit delegate voting based on district or class.
(b) If voting by a proxy is permitted, a patron member may appoint only another patron member as a proxy and, if investor members are permitted, an investor member may appoint only another investor member as a proxy.
(c) The organic rules may provide for the manner of and provisions governing the appointment of a proxy.
(d) The organic rules may provide for voting on any question by ballot delivered by mail or voting by other means on questions that are subject to vote by members. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 5 - Members › § 516. Action without a meeting

§ 516. Action without a meeting
(a) Unless the organic rules require that action be taken only at a members’ meeting, any action that may be taken by the members may be taken without a meeting if each member entitled to vote on the action consents in a record to the action.
(b) Consent under subsection (a) of this section may be withdrawn by a member in a record at any time before the mutual benefit enterprise receives a consent from each member entitled to vote.
(c) Consent to any action may specify the effective date or time of the action. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 5 - Members › § 517. Districts and delegates; classes of members

§ 517. Districts and delegates; classes of members
(a) The organic rules may provide for the formation of geographic districts of patron members and:
(1) for the conduct of patron member meetings by district and the election of directors at the meetings; or
(2) that districts may elect district delegates to represent and vote for the districts at members’ meetings.
(b) A delegate elected under subdivision (a)(2) of this section has one vote unless voting power is otherwise allocated by the organic rules.
(c) The organic rules may provide for the establishment of classes of members, for the preferences, rights, and limitations of the classes, and:
(1) for the conduct of members’ meetings by classes and the election of directors at the meetings; or
(2) that classes may elect class delegates to represent and vote for the classes in members’ meetings.
(d) A delegate elected under subdivision (c)(2) of this section has one vote unless voting power is otherwise allocated by the organic rules. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 6 - Member's Interest in Mutual Benefit Enterprise › § 601. Member’s interest

§ 601. Member’s interest
A member’s interest:
(1) is personal property;
(2) consists of:
(A) governance rights;
(B) financial rights; and
(C) the right or obligation, if any, to do business with the mutual benefit enterprise; and
(3) may be in certificated or uncertificated form. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 6 - Member's Interest in Mutual Benefit Enterprise › § 602. Patron and investor member’s interests

§ 602. Patron and investor member’s interests
(a) Unless the organic rules establish investor members’ interests, a member’s interest is a patron member’s interest.
(b) Unless the organic rules otherwise provide, if a mutual benefit enterprise has investor members, while a person is a member of the enterprise, the person:
(1) if admitted as a patron member, remains a patron member;
(2) if admitted as an investor member, remains an investor member; and
(3) if admitted as a patron member and an investor member remains a patron and an investor member if not dissociated in one of the capacities. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 6 - Member's Interest in Mutual Benefit Enterprise › § 603. Transferability of member’s interest

§ 603. Transferability of member’s interest
(a) The provisions relating to the transferability of a member’s interest are subject to Title 9A.
(b) Unless the organic rules otherwise provide, a member’s interest other than financial rights is not transferable.
(c) Unless a transfer is restricted or prohibited by the organic rules, a member may transfer its financial rights in the mutual benefit enterprise.
(d) The terms of any restriction on transferability of financial rights shall be:
(1) set forth in the organic rules and the member records of the enterprise; and
(2) conspicuously noted on any certificates evidencing a member’s interest.
(e) A transferee of a member’s financial rights, to the extent the rights are transferred, has the right to share in the allocation of profits or losses and to receive the distributions to the member transferring the interest to the same extent as the transferring member.
(f) A transferee of a member’s financial rights does not become a member upon transfer of the rights unless the transferee is admitted as a member by the mutual benefit enterprise.
(g) A mutual benefit enterprise need not give effect to a transfer under this section until the enterprise has notice of the transfer.
(h) A transfer of a member’s financial rights in violation of a restriction on transfer contained in the organic rules is ineffective as to a person having notice of the restriction at the time of transfer. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 6 - Member's Interest in Mutual Benefit Enterprise › § 604. Security interest and set-off

§ 604. Security interest and set-off
(a) A member or transferee may create an enforceable security interest in its financial rights in a mutual benefit enterprise.
(b) Unless the organic rules otherwise provide, a member may not create an enforceable security interest in the member’s governance rights in a mutual benefit enterprise.
(c) The organic rules may provide that a mutual benefit enterprise has a security interest in the financial rights of a member to secure payment of any indebtedness or other obligation of the member to the enterprise. A security interest provided for in the organic rules is enforceable under and governed by 9A V.S.A. article 9.
(d) Unless the organic rules otherwise provide, a member may not compel the mutual benefit enterprise to offset financial rights against any indebtedness or obligation owed to the enterprise. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 6 - Member's Interest in Mutual Benefit Enterprise › § 605. Charging orders for judgment creditor of member or transferee

§ 605. Charging orders for judgment creditor of member or transferee
(a) On application by a judgment creditor of a member or transferee, a court may enter a charging order against the financial rights of the judgment debtor for the unsatisfied amount of the judgment. A charging order issued under this subsection constitutes a lien on the judgment debtor’s financial rights and requires the mutual benefit enterprise to pay over to the creditor or receiver to the extent necessary to satisfy the judgment any distribution that would otherwise be paid to the judgment debtor.
(b) To the extent necessary to effectuate the collection of distributions pursuant to a charging order under subsection (a) of this section, the court may:
(1) appoint a receiver of the share of the distributions due or to become due to the judgment debtor under the judgment debtor’s financial rights, with the power to make all inquiries the judgment debtor might have made; and
(2) make all other orders that the circumstances of the case may require to give effect to the charging order.
(c) Upon a showing that distributions under a charging order will not pay the judgment debt within a reasonable time, the court may foreclose the lien and order the sale of the financial rights. The purchaser at the foreclosure sale obtains only the financial rights that are subject to the charging order, does not thereby become a member, and is subject to section 603 of this title.
(d) At any time before a sale pursuant to a foreclosure, a member or transferee whose financial rights are subject to a charging order under subsection (a) of this section may extinguish the charging order by satisfying the judgment and filing a certified copy of the satisfaction with the court that issued the charging order.
(e) At any time before sale pursuant to a foreclosure, the mutual benefit enterprise or one or more members whose financial rights are not subject to the charging order may pay to the judgment creditor the full amount due under the judgment and succeed to the rights of the judgment creditor, including the charging order. Unless the organic rules otherwise provide, the enterprise may act under this subsection only with the consent of all members whose financial rights are not subject to the charging order.
(f) This title does not deprive any member or transferee of the benefit of any exemption of laws applicable to the member’s or transferee’s financial rights.
(g) This section provides the exclusive remedy by which a judgment creditor of a member or transferee may satisfy the judgment from the member’s or transferee’s financial rights. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 7 - Marketing Contracts › § 701. Authority

§ 701. Authority
In this article, “marketing contract” means a contract between a mutual benefit enterprise and another person who need not be a patron member:
(1) requiring the other person to sell or to deliver for sale or marketing on the person’s behalf a specified part of the person’s products, commodities, or goods exclusively to or through the enterprise or any facilities furnished by the enterprise; or
(2) authorizing the enterprise to act for the person in any manner with respect to the products, commodities, or goods. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 7 - Marketing Contracts › § 702. Marketing contracts

§ 702. Marketing contracts
(a) If a marketing contract provides for the sale of products, commodities, or goods to a mutual benefit enterprise, the sale transfers title to the enterprise upon delivery or at any other specific time expressly provided by the contract.
(b) A marketing contract may:
(1) authorize a mutual benefit enterprise to create an enforceable security interest in the products, commodities, or goods delivered; and
(2) allow the enterprise to sell the products, commodities, or goods delivered and pay the sales price on a pooled or other basis after deducting selling costs, processing costs, overhead, expenses, and other charges.
(c) Some or all of the provisions of a marketing contract between a patron member and a mutual benefit enterprise may be contained in the organic rules. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 7 - Marketing Contracts › § 703. Duration of marketing contract

§ 703. Duration of marketing contract
The initial duration of a marketing contract may not exceed 10 years, but the contract may be self-renewing for additional periods not exceeding five years each. Unless the contract provides for another manner or time for termination, either party may terminate the contract by giving notice in a record at least 90 days before the end of the current term. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 7 - Marketing Contracts › § 704. Remedies for breach of contract

§ 704. Remedies for breach of contract
(a) Damages to be paid to a mutual benefit enterprise for breach or anticipatory repudiation of a marketing contract may be liquidated, but only at an amount or under a formula that is reasonable in light of the actual or anticipated harm caused by the breach or repudiation. A provision that so provides is not a penalty.
(b) Upon a breach of a marketing contract, whether by anticipatory repudiation or otherwise, a mutual benefit enterprise may seek:
(1) an injunction to prevent further breach; and
(2) specific performance.
(c) The remedies in this section are in addition to any other remedies available to an enterprise under law other than this title. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 8 - Directors and Officers › § 801. Board of directors

§ 801. Board of directors
(a) A mutual benefit enterprise shall have a board of directors of at least three individuals unless the enterprise has fewer than three members. If the enterprise has fewer than three members, the number of directors may not be fewer than the number of members.
(b) The affairs of a mutual benefit enterprise shall be managed by or under the direction of the board of directors. The board may adopt policies and procedures that do not conflict with the organic rules or this title.
(c) An individual is not an agent for a mutual benefit enterprise solely by being a director. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 8 - Directors and Officers › § 802. No liability as director for mutual benefit enterprise’s obligations

§ 802. No liability as director for mutual benefit enterprise’s obligations
A debt, obligation, or other liability of a mutual benefit enterprise is solely that of the enterprise and is not a debt, obligation, or liability of a director solely by reason of being a director. An individual is not personally liable, directly or indirectly, for an obligation of an enterprise solely by reason of being a director. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 8 - Directors and Officers › § 803. Qualifications of directors

§ 803. Qualifications of directors
(a) Unless the organic rules otherwise provide, and subject to subsection (c) of this section, each director of a mutual benefit enterprise shall be an individual who is a member of the enterprise or an individual who is designated by a member that is not an individual for purposes of qualifying and serving as a director. Initial directors need not be members.
(b) Unless the organic rules otherwise provide, a director may be an officer or employee of the mutual benefit enterprise.
(c) If the organic rules provide for nonmember directors, the number of nonmember directors may not exceed:
(1) one if there are two through four directors;
(2) two if there are five through eight directors; or
(3) one-third of the total number of directors if there are at least nine directors.
(d) The organic rules may provide qualifications for directors in addition to those in this section. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 8 - Directors and Officers › § 804. Election of directors and composition of board

§ 804. Election of directors and composition of board
(a) Unless the organic rules require a greater number:
(1) the number of directors that shall be patron members may not be fewer than:
(A) one if there are two or three directors;
(B) two if there are four or five directors;
(C) three if there are six through eight directors; or
(D) one-third of the directors if there are at least nine directors; and
(2) a majority of the board of directors shall be elected exclusively by patron members.
(b) Unless the organic rules otherwise provide, if a mutual benefit enterprise has investor members, the directors who are not elected exclusively by patron members are elected by the investor members.
(c) Subject to subsection (a) of this section, the organic rules may provide for the election of all or a specified number of directors by one or more districts or classes of members.
(d) Subject to subsection (a) of this section, the organic rules may provide for the nomination or election of directors by districts or classes, directly or by district delegates.
(e) If a class of members consists of a single member, the organic rules may provide for the member to appoint a director or directors.
(f) Unless the organic rules otherwise provide, cumulative voting for directors is prohibited.
(g) Except as otherwise provided by the organic rules, subsection (e) of this section, or sections 303, 516, 517, and 809 of this title, member directors shall be elected at an annual members’ meeting. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 8 - Directors and Officers › § 805. Term of director

§ 805. Term of director
(a) Unless the organic rules otherwise provide and subject to subsections (c) and (d) of this section and subsection 303(c) of this title, the term of a director expires at the annual members’ meeting following the director’s election or appointment. The term of a director may not exceed three years.
(b) Unless the organic rules otherwise provide, a director may be reelected.
(c) Except as otherwise provided in subsection (d) of this section, a director continues to serve until a successor director is elected or appointed and qualifies or the director is removed, resigns, is adjudged incompetent, or dies.
(d) Unless the organic rules otherwise provide, a director does not serve the remainder of the director’s term if the director ceases to qualify to be a director. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 8 - Directors and Officers › § 806. Resignation of director

§ 806. Resignation of director
A director may resign at any time by giving notice in a record to the mutual benefit enterprise. Unless the notice states a later effective date, a resignation is effective when the notice is received by the enterprise. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)
2023 Vermont Statutes › Title 11C - Mutual Benefit Enterprises › Chapter 8 - Directors and Officers › § 807. Removal of director

§ 807. Removal of director
Unless the organic rules otherwise provide, the following rules apply:
(1) Members may remove a director with or without cause.
(2) A member or members holding at least 10 percent of the total voting power entitled to be voted in the election of a director may demand removal of the director by one or more signed petitions submitted to the officer of the mutual benefit enterprise charged with keeping its records.
(3) Upon receipt of a petition for removal of a director, an officer of the enterprise or the board of directors shall:
(A) call a special meeting of members to be held not later than 90 days after receipt of the petition by the enterprise; and
(B) mail or otherwise transmit or deliver in a record to the members entitled to vote on the removal and to the director to be removed notice of the meeting which complies with section 508 of this title.
(4) A director is removed if the votes in favor of removal are equal to or greater than the votes required to elect the director at the time of the vote. (Added 2011, No. 84 (Adj. Sess.), § 1, eff. April 20, 2012.)