(a) Any employee cooperative may establish through its governing documents a system of internal capital accounts, to reflect the book value and to determine the redemption price of membership shares, capital stock, and written notices of allocation.

Terms Used In Alabama Code 10A-11-1.10

  • COLLECTIVE RESERVE ACCOUNT: An internal capital account that represents the portion of the net book value of the corporation attributable to the cooperative. See Alabama Code 43-2-747
  • cooperative: Includes an employee cooperative as defined in Chapter 11. See Alabama Code 45-26-231.06
  • director: An individual who serves on the board of directors, by whatever name known, of a foreign or domestic corporation. See Alabama Code 45-26-231.06
  • EMPLOYEE COOPERATIVE: A corporation which has elected to be governed by this chapter. See Alabama Code 43-2-747
  • INTERNAL CAPITAL ACCOUNTS: A system of accounts on the books of an employee cooperative that reflects the book value of the corporation. See Alabama Code 43-2-747
  • member: A natural person who has been accepted for membership in and owns a membership share issued by an employee cooperative. See Alabama Code 43-2-747
  • MEMBERSHIP SHARE: A single share of voting stock issued to each member of a worker cooperative as evidence of membership. See Alabama Code 43-2-747
  • officer: An individual elected, appointed, or designated as an officer of an entity by the entity's governing authority or under the entity's governing documents. See Alabama Code 45-26-231.06

(b) The governing documents of an employee cooperative may permit the periodic redemption of written notices of allocation and capital stock, and shall provide for recall and redemption of the membership share upon termination of membership in the cooperative. No redemption shall be made if the redemption would result in the liability of any director or officer of the employee cooperative.

(c) The governing documents may provide for the employee cooperative to pay or credit interest on the balance in each member‘s internal capital account.

(d) The governing documents may authorize assignment of a portion of retained net earnings and net losses to a collective reserve account. Earnings assigned to the collective reserve account may be used for any and all corporate purposes as determined by the board of directors.

(Act 97-949, p. 524, §10; §10-14-10; amended and renumbered by Act 2009-513, p. 967, §312.)