Article VIII: Disposition & Pledging of Property Dissolution & Distribution of Surplus Assets on Dissolution
Section 8.1 Disposition & Pledging of Property
The Cooperative may not sell, mortgage, lease or otherwise dispose of or encumber all or any substantial portion in excess of 10% of its total assets unless such sale, mortgage, lease or other disposition or encumbrance is:
(a) Authorized at a meeting of the ten-total members by the affirmative vote cast in person, without proxies, of at least 2/3 of the total members of the Cooperative, and
(b) Authorized by the holders of at least 75% of the outstanding indebtedness of the Cooperative; and
(c) Preceded by a notice of meeting at which such sale, mortgage, lease or other disposition or encumbrance is to be voted on.
Notwithstanding the foregoing provisions of this Section, the members of the Cooperative may, by the affirmative majority of votes cast in person at any meeting of the members, delegate to the Board the power and authority:
(1) To borrow monies from any source and in any such amounts as the Board may from time-to-time determine are needed in pursuit of the Cooperative’s business purposes, and
(2) To mortgage or otherwise pledge or encumber any and all of the Cooperative’s property or assets as security therefor, and
(3) With respect to other cooperative organizations only, to sell and lease back any of the Cooperative’s property or assets.
Supplementary to the foregoing paragraphs of this Section and any other applicable provisions of law or these Bylaws, no sale, lease, lease-sale, exchange, transfer or other disposition within a single calendar year, of physical plant of the Cooperative with net value in excess of 10% of the Cooperative’s total assets, based upon the most recent audit of the Cooperative, shall be authorized except in conformity to the following:
(1) If the Board looks with favor upon any proposal for such sale, lease, lease-sale, exchange, transfer or other disposition, it shall first cause 3 independent non-affiliated appraisers, expert 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 3 independent appraisers shall be designated by a district court resident judge for the judicial district in which the Cooperative’s headquarters are located. If such judge refuses to make such designations, they shall be made by the Board.
(2) If the Board after receiving such appraisals (and other terms and conditions which are submitted, if any) determines that the proposals should be submitted for consideration by members, it shall first give by notice in appropriate publications other cooperatively organized entities an opportunity to submit competing proposals. Any interested cooperatively organized entity shall be sent copies of any proposals which the Cooperative has already received and copies of the respective reports of the 3 appraisers. Such other interested cooperatively organized entities shall be given not less than 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.
(3) 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 not less than sixty (60) days before noticing a special meeting of the members thereon or, if such be the case, the next annual member meeting, expressing in detail each of any such proposals, and shall call a special meeting of the members for consideration thereof and action thereon, which meeting shall be held not less than 10 nor more than 30 days after giving the Notice thereof to the members: provided that consideration and action by the members may be given at the next annual meeting of the Board so determines and if such annual meeting is held not less than 10 nor more than 30 days after the giving of notice of such meeting.
(4) Any 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 (1), (2), (3) and (4) above shall not apply to a sale, lease, lease-sale, exchange, transfer or other disposition to one or more telephone cooperatives if the substantive or actual legal effect thereof is to merge or consolidate with such other one or more telephone cooperatives.
Section 8.2 Dissolution
The Cooperative may be dissolved by filing, as hereinafter provided, certificate which shall be entitled and endorsed “Certificate of Dissolution of NORTH CENTRAL TELEPHONE COOPERATIVE, INC.®” and shall state:
(1) Name of the Cooperative, and if such Cooperative is a corporation resulting from a consolidation as herein provided, the names of all the original corporations or cooperatives.
(2) The dates of filing of Certificate of Incorporation, and if such Cooperative is a Cooperative resulting from a consolidation as herein provided, the dates on which the Certificates of Incorporation of the original corporations were filed.
(3) That the Cooperative elects to dissolve.
(4) The name and post office address of each of its directors, and the name, title and post office address of each of its officers.
Such Certificate shall be subscribed and acknowledged in the same manner as an original Certificate of Incorporation by the president or a vice president, and the secretary or an assistant secretary, who shall make and annex an affidavit, stating that they have been authorized to execute and file such certificate by the votes cast in person of at least 2/3 of its total membership voting without proxies and that the dissolution has been authorized by at least 75% of the holders of the indebtedness of the Cooperative.
A Certificate of Dissolution and a certified copy or copies thereof shall be filed in the same place as the original Certificate of Incorporation and thereupon the Cooperative shall be deemed to be dissolved.
Such Cooperative shall continue for the purpose of paying, satisfying or discharging any existing liabilities or obligations and collecting or liquidating its assets, and doing all other acts required to adjust and wind up its business and affairs, and may sue and be sued in its corporate name.
Section 8.3 Distribution of Surplus Assets on Dissolution
Any assets remaining after all debts and liabilities of the Cooperative shall have been paid shall be disposed of pursuant to the provisions of Section 2.4 above; 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.