DISPOSITION AND PLEDGING OF PROPERTY; DISTRIBUTION OF SURPLUS ASSETS ON DISSOLUTION
SECTION 8.01. Disposition and Pledging of Property.
- The Cooperative may not sell, mortgage, lease or otherwise dispose of or encumber all, or substantially all, of its property unless such sale, mortgage, lease, or other disposition or encumbrance is authorized at a meeting of the members thereof by the affirmative vote of not less than two-thirds (2/3) of all the members of the cooperative, and unless the notice of such proposed sale, mortgage, lease or other disposition or encumbrances shall have been contained in the notice of the meeting. "Substantially all" as used herein shall mean ten percent (10%) or more of the Cooperative's assets in the fiscal year of one or more of the transactions referred to in the previous sentence. However, the Board of Directors, without authorization of the members, shall have full power and authority to sell, lease, lease-sell, exchange, transfer or otherwise dispose of merchandise and any property no longer necessary or useful for operating the Cooperative.
- Supplementary to the foregoing subsection (a) and any other applicable provisions of law or these By-laws, no sale, lease, lease-sale, exchange, transfer, mortgage or other disposition of all or substantially all of the Cooperative's property and assets shall be authorized except in conformity with the following:
- If the Board of Directors looks with favor upon any proposal for such sale, lease, lease- sale, exchange, transfer or other disposition, it shall first cause three (3) independent, non-affiliated appraisers, experts in such matters, to render their individual opinions as to the value of the Cooperative with respect to such a sale, lease, lease-sale, exchange, transfer or other disposition and as to any other terms and conditions which should be considered. The three (3) such appraisers shall be designated by the Board of Directors.
- If the Board of Directors, after receiving such appraisals (and other terms and conditions which are submitted, if any), determines that the proposal should be submitted for consideration by the members it shall first give every other electric cooperative corporately sited and operating in Illinois (which has not made such an offer for such sale, lease, lease-sale, exchange, transfer or other disposition) an opportunity to submit competing proposals. Such opportunity shall be in the form of a written notice to such electric cooperatives, which notice shall be attached to a copy of the proposal which the Cooperative has already received and copies of the respective reports of the three (3) appraisers. Such electric cooperatives shall be given not less than thirty (30) days during which to submit competing proposals and the actual minimum period within which proposals are to be submitted shall be stated in the written notice given to them.
- If the Board then determines that favorable consideration should be given to the initial or any subsequent proposal which has been submitted to it, it shall so notify the members. Expressing in detail each of any such proposals, and shall call a special meeting of the members for consideration thereof, which meeting shall be held not less than forty (40) days nor more than sixty (60) days after the giving of such notice to the members; PROVIDED, that consideration thereof by the members may be given at the next annual meeting if the Board so determines.
- Any fifty (50) or more members, by so petitioning the Board not less than thirty (30) days prior to the date of such special or annual meeting, may cause the Cooperative with the cost to be borne by the Cooperative, to mail to all members any opposing or alternative positions which they may have to the proposals that have been submitted or any recommendations that the Board has made. The provisions of this subsection (b) shall not apply to a sale, lease, lease-sale, exchange, transfer or other disposition to one or more other electric co- operatives if the substantive or actual legal effect thereof is to merge or consolidate with such other one or more electric cooperatives.
SECTION 8.02. Distribution of Surplus Asset on Dissolution. Upon the Cooperative's dissolution, any assets remaining after all liabilities or obligations of the Cooperative have been satisfied and discharged shall, to the extent practicable as determined by the Board of Directors not inconsistently with the provisions of the third paragraph of Section 7.02 of these By-laws, be distributed without priority but on a patronage basis among all persons having been members of the Cooperative for any period(s) during its existence;
PROVIDED, HOWEVER, that, if in the judgment of the Board the amount of such surplus is too small to justify the expense of making such distribution, the Board may, in lieu thereof, donate, or provide for the donation of, such surplus to one or more non-profit charitable or educational organizations that are exempt from Federal income taxation.