66 BULLETIN 547, U. S. DEPARTMENT OP AGRICULTURE. 



the matter of a reserve fund; nine provide that not less than 10 per 

 cent of the net earnings shall be set aside until a fund equal to 30 

 per cent of the paid-up capital has been accumulated, though six of 

 the nine provide that the associations may revise this; one law pro- 

 vides for the setting aside of not less than 5 nor more than 25 per cent 

 of the net earnings, and another from 10 to 25 per cent; another law 

 stipulates that not less than 5 per cent shall be set aside until 30 

 per cent of the paid-up capital has been accumulated; one provides 

 for the setting aside of 10 per cent until 20 per cent of the paid-up 

 capital has been accumulated, and another for not less than 10 per 

 cent until 50 per cent has been accumulated. 



. Eleven laws provide that the educational fund shall be as specified 

 in the by-laws; 13 fail to make any mention of an educational fund; 

 six provide that 5 per cent of the net profits shall be set aside for such 

 a purpose, but four of the six grant the association the privilege of 

 changing this; one law provides for an educational fund of not to 

 exceed 5 per cent of the net profits; one provides for 2 per cent sub- 

 ject to revision by the associations; and one provides for the use of 

 2\ per cent of the net profits for this purpose. 



A question that arises in connection with the payment of patronage 

 dividends is whether or not nonmembers shall have any share in the 

 profits of an organization. Twelve cooperative laws state that non- 

 members shall or may receive patronage dividends, and several of 

 these specify that the rate to nonmembers shall be one-half the rate 

 paid to members. Several of the laws do not touch on this point at 

 all, and a number merely state that the by-laws shall decide in regard 

 to the paying of patronage dividends. 



DISSOLUTION. 



Sixteen laws have provisions regarding the dissolution of organiza- 

 tions formed thereunder. Eight laws permit dissolution upon 

 written request of two-thirds of the members; five provide that if 

 an association has not paid any stock dividends for five consecutive 

 years, five or more members may petition the court to have the 

 organization dissolved; the law of one State provides that five mem- 

 bers may petition for dissolution of an organization which has failed 

 to pay stock dividends for three consecutive years; one law provides 

 for dissolution by a majority votej and one states that the procedure 

 shall be the same as for corporations under the general corporation 

 law. 



ANNUAL REPORTS. 



Sixteen laws specify that all associations formed thereunder 

 shaD mako certain reports. Ten of these provide for an annual 

 report to the secretary of state; two of the 10 also provido for reports 

 to other departments, one to the State division of markets and 



