AB327,123,9 8(2) Liability of cooperative for wrongful transfers of its securities. (a) In
9this subsection:
AB327,123,1210 1. "Proper person" means the registered owner or last prior transferee, whether
11or not described as fiduciary for another, or his or her authorized agent or legal
12representative or the successor to his or her interest by operation of law.
AB327,123,1313 2. "Transfer" includes a redemption or recall of stock.
AB327,123,1614 3. "Wrongful transfer" means a transfer which is in excess of the authorization
15or capacity of the transferor, or which is made in breach of the transferor's fiduciary
16duty.
AB327,123,2017 (b) A cooperative may not be held liable for acting upon wrongful transfers of
18its securities which are not "securities" as defined in s. 408.102, unless it has notice
19that the certificate was not transferred by a proper person or has notice that the
20transfer was a wrongful transfer.
AB327,123,24 21(3) Missing securities or records. (a) When a security issued by a cooperative,
22which is not a "security" as defined in s. 408.102, is missing, the cooperative shall
23issue a duplicate security if the owner so requests and furnishes an indemnity
24acceptable to the cooperative.
AB327,124,4
1(b) When records showing ownership of securities or apportionment of equity
2or membership interests are missing and the information therein contained is
3necessary to a proposed redemption of the interest, the cooperative may give notice
4and redeem by satisfying all of the following:
AB327,124,65 1. The cooperative shall set aside an amount equal to the value of the interests
6to be redeemed.
AB327,124,87 2. The cooperative shall give notice of such redemption to all owners of interests
8of which the cooperative has knowledge.
AB327,124,129 3. If there are interests, the ownership of which is unknown to the cooperative,
10it shall publish notice of the redemption at least once a month for 4 months in a
11publication circulated among members of cooperatives in the area, and also publish
12a class 3 notice, under ch. 985.
AB327,124,15 13193.611 Assignment of financial rights. (1) Assignment of financial
14rights permitted.
Except as provided in sub. (3), a member's financial rights in a
15cooperative are transferable in whole or in part.
AB327,124,23 16(2) Effect of assignment of financial rights. An assignment of a member's
17financial rights under sub. (1) entitles the assignee to receive, to the extent assigned,
18only the share of profits and losses and the distributions to which the assignor would
19otherwise be entitled. An assignment of a member's financial rights under sub. (1)
20does not dissolve the cooperative and does not entitle or empower the assignee to
21become a member, to exercise any governance rights, to receive any notices from the
22cooperative, or to cause dissolution. The assignment may not allow the assignee to
23control the member's exercise of governance or voting rights.
AB327,125,6 24(3) Restrictions on assignment of financial rights. (a) A restriction on the
25assignment of financial rights in a cooperative may be imposed in the articles, in the

1bylaws, in a member control agreement, by a resolution adopted by the members at
2a members' meeting, or by an agreement among members and the cooperative. A
3restriction is not binding with respect to financial rights reflected in the required
4records of the cooperative before the adoption of the restriction, unless the owners
5of those financial rights are parties to the agreement or voted in favor of the
6restriction.
AB327,125,117 (b) Subject to par. (c), a restriction under par. (a) is enforceable only if the
8restriction is not manifestly unreasonable under the circumstances and is noted
9conspicuously in the required records of the cooperative. Such a restriction may be
10enforced against the owner of the restricted financial rights or a successor or
11transferee of the owner, including a pledgee or a legal representative.
AB327,125,1612 (c) A restriction on an assignment of financial rights under par. (a) which is
13otherwise valid and in effect at the time of the issuance of a statement of membership
14interest issued by the cooperative under s. 193.615 but which is not reflected in that
15statement is ineffective against an assignee who takes an assignment in reliance on
16the statement.
AB327,125,2017 (d) A security interest in a member's financial rights may be foreclosed and
18otherwise enforced, and a secured party may assign a member's financial rights in
19accordance with ch. 408, without the consent or approval of the member whose
20financial rights are subject to the security interest.
AB327,125,25 21193.615 Nature and terms of a membership interest and statement of
22interest owned.
(1) Generally. A membership interest is personal property. A
23membership interest does not give the owner of the interest any interest in specific
24cooperative property. All property of the cooperative is property of the cooperative
25itself.
AB327,126,7
1(2) Statement of membership interest. At the request of any member, the
2cooperative shall state in writing the particular membership interest owned by that
3member as of the date the cooperative makes the statement. The statement shall
4describe the member's rights to vote, if any, and to share in profits, losses, and
5distributions, restrictions on assignments of the member's financial rights under s.
6193.611 (3) or voting rights under s. 193.555, and any assignment of the member's
7rights then in effect other than a security interest.
AB327,126,9 8(3) Terms of membership interests generally. (a) All the membership
9interests of a cooperative shall satisfy all of the following:
AB327,126,1110 1. Unless the articles or bylaws provide otherwise, the membership interests
11shall be of one class, without series.
AB327,126,1612 2. The membership interests shall be patron membership interests and, if
13authorized, nonpatron membership interests subject to this chapter entitled to vote
14as provided in s. 193.555, and have equal rights and preferences in all matters not
15otherwise provided for by the board unless and to the extent that the articles or
16bylaws have fixed the relative rights and preferences of different classes and series.
AB327,126,1817 (b) All of the following apply to the rights and preferences of a class or series
18of membership interests:
AB327,126,2319 1. The rights and preferences may be made dependent upon facts ascertainable
20outside the articles or bylaws, or outside the resolution or resolutions under sub. (5)
21establishing the class or series, if the manner in which the facts operate upon the
22rights and preferences is clearly and expressly set forth in the articles or bylaws or
23in the resolution or resolutions establishing the class or series.
AB327,127,324 2. The rights and preferences may include by reference some or all of the terms
25of any agreements, contracts, or other arrangements entered into by the cooperative

1in connection with the establishment of the class or series if the cooperative retains
2at its principal office a copy of the agreements, contracts, or other arrangements or
3the portions thereof included by reference.
AB327,127,64 (c) If specified in the articles or bylaws, or the resolution under sub. (5)
5establishing the class or series, all of the following apply to membership interests of
6a class or series:
AB327,127,97 1. The membership interests are subject to the right of the cooperative to
8redeem any of those membership interests at a price fixed in the articles or bylaws
9or by the board.
AB327,127,1110 2. Owners of the membership interests may receive cumulative, partially
11cumulative, or noncumulative distributions.
AB327,127,1312 3. The membership interests may have preference over any other class or series
13of membership interests for the payment of distributions.
AB327,127,1514 4. The membership interests may be convertible into membership interests of
15any other class or series.
AB327,127,1716 5. The membership interests may have full, partial, or no voting rights, except
17as provided in s. 193.555.
AB327,127,25 18(4) Rights of judgment creditor. On application to the circuit court by any
19judgment creditor of a member, the court may order the payment of the unsatisfied
20amount of the judgment from a member's or an assignee's financial rights. Such a
21judgment creditor has only the rights of an assignee of a member's financial rights
22under s. 193.611. This subsection is the sole and exclusive remedy of a judgment
23creditor with respect to the judgment debtor's membership interest. This subsection
24does not deprive any member or assignee of financial rights of the benefit of any
25exemption under s. 815.18 applicable to the membership interest.
AB327,128,6
1(5) Board authority to fix terms. (a) If permitted under the bylaws, the board
2may adopt a resolution establishing a class or series of membership interests, setting
3forth the designation of the class or series, and fixing the relative rights and
4preferences of the class or series, consistent with this chapter. A resolution under
5this paragraph takes effect on the 3rd day after the date on which the statement
6required under par. (b) is given to the members, as determined by the board.
AB327,128,107 (b) The cooperative may not accept contributions for any membership interests
8established by resolution under par. (a) until the board gives the members a
9statement setting forth the name of the cooperative, the text of the resolution, and
10the date on which the resolution was adopted.
AB327,128,13 11(7) Security interest in cooperative securities. For the purpose of any law
12relating to security interests, a membership interest, governance or voting rights,
13and financial rights are each to be characterized as provided in s. 408.103 (3).
AB327,128,24 14(8) Powers of estate of a deceased or incompetent member and other
15fiduciaries.
(a) Except as provided in par. (b), if a member who is an individual dies
16or a court adjudges the member to be incompetent to manage his or her person or
17property, or an order for relief under a judgment of bankruptcy is entered with
18respect to the member, the member's executor, administrator, guardian, conservator,
19trustee, or other legal representative may exercise all of the rights applicable to the
20member's membership interest for the purpose of settling the estate or
21administering the member's property. Except as provided in par. (b), if a member is
22not an individual and is dissolved, terminated, or placed by a court in receivership
23or bankruptcy, the member's legal representative or successor may exercise all of the
24rights applicable to the member's membership interest.
AB327,129,6
1(b) Subject to the articles and bylaws, if an event described in par. (a) causes
2the termination of a member's membership interest and the termination does not
3result in dissolution of the cooperative, the terminated member's interest is
4considered to be that of an assignee of financial rights under s. 193.611 and the rights
5to be exercised by the executor, administrator, guardian, conservator, trustee, legal
6representative, or successor are limited accordingly.
AB327,129,11 7(9) Liability of subscribers and members with respect to membership
8interests.
A subscriber for membership interests or a member of a cooperative is
9under no obligation to the cooperative or its creditors with respect to the membership
10interests subscribed for or owned, except to pay to the cooperative the full
11consideration for which the membership interests are issued or to be issued.
AB327,129,15 12193.621 Certificated membership interests. (1) Certificated interests
13authorized.
A membership interest of a cooperative may be certificated. The
14cooperative shall provide each holder of a certificated membership interest with a
15certificate of membership interest under sub. (2).
AB327,129,22 16(2) Requirements of certificate; generally. (a) A certificate of membership
17interest shall be signed by an agent or officer authorized in the articles or bylaws to
18sign the certificate or, in the absence of such an authorization, by the chairperson of
19the board or the records officer of the cooperative. If the person who signs the
20certificate subsequently ceases to have the capacity to sign the certificate before the
21certificate is issued, the cooperative may issue the certificate with the same effect as
22if the person had that capacity on the date of its issue.
AB327,129,2423 (b) A certificate of membership interest shall contain all of the following
24information on the certificate's face:
AB327,129,2525 1. The name of the cooperative.
AB327,130,2
12. A statement that the cooperative is organized under the laws of this state
2and this chapter.
AB327,130,33 3. The name of the person to whom the certificate is issued.
AB327,130,54 4. The number and class of membership interests, and the designation of the
5series, if any, that the certificate represents.
AB327,130,76 5. A statement that membership interests are subject to the articles and
7bylaws.
AB327,130,128 6. Any restrictions on transfer of the membership interests that the certificate
9represents, including any requirement for the approval of the board and first rights
10to purchase by the cooperative. Notwithstanding any other provision of this
11subsection, the information required under this subdivision may be stated by
12reference to the back of the certificate or to another document.
AB327,130,21 13(3) Requirements of certificate; multiple series or classes. A certificate of
14membership interest representing a membership interest issued by a cooperative
15that is authorized to issue membership interests of more than one class or series shall
16set forth upon the face or back of the certificate, or shall state that the cooperative
17will furnish to any member upon request and without charge, a full statement of the
18designations, preferences, limitations, and relative rights of the membership
19interests of each class or series authorized to be issued, so far as they have been
20determined, and the authority of the board to determine the relative rights and
21preferences of subsequent classes or series.
AB327,130,24 22(4) Prima facie evidence. A certificate of membership interest issued under
23this section is prima facie evidence of the ownership of the membership interest that
24the certificate represents.
AB327,131,11
1(5) Uncertificated membership interests authorized. Unless uncertificated
2membership interests are prohibited by the articles or bylaws, the board may adopt
3a resolution permitting uncertificated membership interests. Such a resolution does
4not apply to a membership interest represented by a certificate until the certificate
5is surrendered to the cooperative. Within a reasonable time after the issuance or
6transfer of an uncertificated membership interest, the cooperative shall send to the
7new member a statement containing the information required under sub. (2) (b) and
8(3) to be stated on certificates, unless the cooperative is publicly held and has adopted
9a system of issuance, recordation, and transfer of its membership interests by
10electronic or other means not involving an issuance of certificates, in compliance
11with section 17A of the Securities Exchange Act of 1934.
AB327,131,15 12(6) Comparable rights. Except as otherwise provided under this chapter, the
13rights and obligations of holders of certificated membership interests are identical
14to the rights and obligations of holders of uncertificated membership interests of the
15same class and series.
AB327,131,20 16193.625 Replacement certificates. (1) Issuance. A cooperative may issue
17a replacement certificate of membership interest under s. 193.621 using the
18procedure specified in s. 408.405 (1), if the owner of the membership interest
19represented in a certificate claims that the certificate has been lost, destroyed or
20wrongfully taken.
AB327,131,22 21(2) Not an overissue. The issuance of a replacement certificate under sub. (1)
22is not an overissue of the membership interest it represents.
AB327,132,8 23193.631 Restriction on transfer or registration of membership
24interests.
(1) How imposed. A restriction on the transfer, including registration,
25of a membership interest may be imposed in the articles, in the bylaws, in a member

1control agreement, by a resolution adopted by the members, or by an agreement
2among or other written action by members or among them and the cooperative. A
3restriction imposed by a member control agreement or other written action of
4members is effective only against the parties to the agreement or written action or
5the members who assent pursuant to a member resolution. A restriction is not
6binding with respect to membership interests issued prior to the adoption of the
7restriction, unless the holders of those membership interests are parties to the
8agreement or voted in favor of the restriction.
AB327,132,11 9(2) Restrictions permitted. (a) A restriction under sub. (1) is enforceable only
10if the restriction is not manifestly unreasonable under the circumstances and any of
11the following apply:
AB327,132,1512 1. The restriction is noted conspicuously on a certificate of membership interest
13representing the membership interest or the existence of the restriction is noted on
14the certificate and reference is made to a separate document creating or describing
15the restriction.
AB327,132,1716 2. The restriction is imposed under this chapter or is included in the articles
17or bylaws.
AB327,132,1918 3. The restriction relates to an uncertificated membership interest and is
19included in information sent to the holders of such a membership interest.
AB327,132,2220 (b) A restriction that is enforceable under par. (a) may be enforced against the
21holder of the restricted membership interest or a successor or transferee of the
22holder, including a pledgee or a legal representative.
AB327,132,2323 subchapter vii
AB327,132,2524 contributions, allocations,
25 and distributions
AB327,133,4
1193.701 Authorization, form, and acceptance. (1) Board may authorize.
2If authorized by the board, a cooperative may accept contributions, make
3contribution agreements under s. 193.711, and make contribution rights agreements
4under s. 193.715.
AB327,133,6 5(2) Permissible forms. A person may make a contribution to a cooperative by
6any of the following means:
AB327,133,87 (a) By paying money or transferring the ownership of an interest in property
8to the cooperative, or performing services to or for the benefit of the cooperative.
AB327,133,119 (b) Through a written obligation that is signed by the person and requires the
10person to pay money or transfer ownership of an interest in property to the
11cooperative or to perform services to or for the benefit of the cooperative.
AB327,133,13 12(3) Acceptance of contributions. No purported contribution is to be treated
13as or considered to be a contribution, unless all of the following apply:
AB327,133,1614 (a) The board accepts the contribution on behalf of the cooperative and in that
15acceptance describes the contribution, including terms of future performance, if any,
16and states the value being accorded to the contribution.
AB327,133,1817 (b) The acceptance of the contribution and the contribution's accorded value are
18both reflected in the required records of the cooperative.
AB327,134,9 19193.702 Valuation; presumption and liability. The determinations of the
20board as to a contribution's accorded value under s. 193.701 (3) (a) and the fairness
21to the cooperative of a contribution and any terms of payment or performance
22applicable to the contribution, the terms of any contribution agreement under s.
23193.711, and the terms of any contribution rights agreement under s. 193.715 are
24presumed to be proper if the determinations are made in good faith and on the basis
25of methods that are reasonable under the circumstances. Directors who are present

1and entitled to vote, and who, intentionally or without reasonable investigation, fail
2to vote against approving a consideration that is unfair to the cooperative, or who
3overvalue property or services received or to be received by the cooperative as a
4contribution, are jointly and severally liable to the cooperative for the benefit of the
5members then existing who did not consent to and are damaged by the consideration
6or overvaluing of property or services, to the extent of the damages to those members.
7A director against whom a claim is asserted pursuant to this section, except in a case
8of knowing participation in a deliberate fraud, is entitled to contribution on an
9equitable basis from other directors who are liable under this section.
AB327,134,13 10193.705 Restated value of previous contributions. (1) Definition. In this
11section, "old contributions" means all contributions reflected in the required records
12of a cooperative immediately before the time the cooperative accepts a new
13contribution.
AB327,134,15 14(2) Restatement required. If a cooperative accepts a new contribution, the
15board shall restate the value of all old contributions.
AB327,134,19 16(3) Restatement method for same series or class. (a) Unless otherwise
17provided in the articles or bylaws, the board shall restate the value of old
18contributions of the same series or class of the new contribution by following all of
19the following steps in numerical order:
AB327,134,2020 1. State the value accorded to the new contribution under s. 193.701 (3) (a).
AB327,134,2221 2. Determine what the total value will be, after the restatement under this
22subsection, of all contributions of same series or class as the new contribution.
AB327,134,2523 3. Subtract the value stated under subd. 1. from the value determined under
24subd. 2., yielding the total value, after the restatement under this subsection, of all
25the old contributions of the particular series or class.
AB327,135,4
14. Subtract the value, as reflected in the required records before the
2restatement under this subsection, of the old contributions from the value
3determined under subd. 3., yielding the value to be allocated among and added to the
4old contributions of the particular series or class.
AB327,135,75 5. Allocate the value determined under subd. 4. proportionally among the old
6contributions of the particular series or class, add the allocated values to the values
7of those old contributions, and change the required records accordingly.
AB327,135,98 (b) The values determined under par. (a) 4. and allocated and added under par.
9(a) 5. may be positive, negative, or zero.
AB327,135,13 10(4) Restatement method for different series or class. Unless otherwise
11provided in the articles or bylaws, the board shall restate the value of old
12contributions of a series or class different from that of the new contribution by
13following all of the following steps in alphanumerical order:
AB327,135,1614 (a) Determine the percentage by which any restatement under sub. (3) has
15changed the total contribution value reflected in the required records for the series
16or class of the new contribution.
AB327,135,1917 (b) As to each old contribution of a different series or class, change the value
18reflected in the required records by the percentage determined under par. (a). The
19percentage determined under par. (a) may be positive, negative, or zero.
AB327,135,23 20(5) Aggregating new contributions. If a cooperative accepts more than one
21new contribution of the same series or class at the same time, then for the purpose
22of the restatement required by this section the board may consider all such new
23contributions as if they were a single contribution.
AB327,136,3 24193.711 Contribution agreements. (1g) Contribution agreements
25permitted.
Pursuant to s. 193.701 (1), a cooperative and a member or potential

1member may enter into an agreement requiring the member or potential member to
2contribute goods, services, or money to the cooperative as a condition of membership
3or receipt of a membership interest.
AB327,136,5 4(1r) Signed writing required. A contribution agreement shall be in writing
5and signed by each person required to make a contribution under the agreement.
AB327,136,10 6(2) Agreement irrevocable for definite period; exceptions. A contribution
7agreement is irrevocable for a period of 6 months, unless otherwise provided in the
8contribution agreement or unless each person required to make a contribution under
9the agreement and, if in existence, the cooperative, consents to a different period of
10irrevocability.
AB327,136,16 11(3) Time of performance under agreement. Unless the contribution
12agreement provides otherwise, all payments or other actions required under the
13agreement shall be made or taken at the time or times determined by the board,
14except that a call made by the board for a person to make a payment or perform an
15action required under the agreement shall be uniform for all membership interests
16of the same class or series.
AB327,136,25 17(4) Failure to perform; remedies. (a) Unless the contribution agreement
18provides otherwise, if a person fails to make a payment required under the
19contribution agreement, the cooperative may bring an action for breach of contract,
20sell any membership interests that are subject to the contribution agreement
21pursuant to par. (b) and bring an action to collect any deficiency, or cancel the
22contribution agreement pursuant to par. (c). If a person fails to make a required
23contribution of property or services, the person shall pay to the cooperative an
24amount equal to that portion of the value of the contribution that has not been made,
25as stated in the cooperative's required records.
AB327,137,10
1(b) To the extent provided in par. (a), the cooperative may cancel the
2membership interests of any person who defaults on a contribution agreement and
3sell any membership interests that are subject to a contribution agreement if the
4amount due under the contribution agreement relating to those membership
5interests remains unpaid for a period of 20 days after the cooperative gives written
6notice of demand for payment to the person required to make the payment. The total
7offering price of the membership interests in such a sale shall be at least the amount
8of the balance owed by the person, plus the expenses incidental to the sale. If
9membership interests are sold pursuant to this paragraph, the cooperative shall pay
10to the person, or that person's legal representative, the lesser of the following:
AB327,137,1411 1. The amount by which the proceeds of the sale, less the expenses incident to
12the sale and any additional amounts the person is required to pay under the terms
13of the contribution agreement as a result of the default, exceeds the amount of the
14payment the person failed to make.
AB327,137,1515 2. The total amount paid by the person under the contribution agreement.
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