ORGANIZATION OF COOPERATIVE GRAIN ELEVATOR COMPANIES. 29 



ordinary receipt may be given instead, which receipt is taken up 

 when regular stock certificates are issued." The plan of organization 

 presented in this bulletin contemplates that certain by-law provisions 

 shall be printed upon the stock certificate, and for this reason it may 

 not be practicable to use the regular stock form usually carried by 

 stationers. However, it may be possible to select a stock form on 

 which the special provisions may be printed upon the back of the 

 certificate by the local printer, in which case a reference to these 

 provisions should be made upon the face of the certificate. Care 

 should be exercised that these stock forms do not contain matter 

 which vitiates or conflicts with the special provisions. 



MAINTENANCE AGREEMENT. 



Persons having a knowledge of the early struggles of farmers' ele- 

 vators in the United States may wonder at the absence in the sug- 

 gested form of by-laws presented in this bulletin of the so-called pen- 

 alty clause, which at one time was regarded as of much importance. 

 Men who are familiar with the real intent and purpose of the first 

 use of this clause, which in its most simple form provided for the 

 payment to the company of a charge of 1 or 2 cents per bushel for 

 every bushel of grain which any member of the company should 

 market through other agencies or dealers, state that the idea of a 

 penalty was entirely foreign to its purjDose and that it was intended' 

 only as a voluntary and mutual arrangement whereby, if it became 

 apparent that outside dealers were paying more for grain than it 

 actually was worth in order to discredit the cooperative company, 

 each member would contribute to the support of his company in 

 the manner provided and as long as these conditions existed. The 

 members would then sell their grain to such outside dealers, making 

 these dealers fall victim to their own competitive methods. It pro- 

 vided an equitable means for contributing to the support of the co- 

 operative company during an emergency. Other companies copied 

 the idea but lost sight of its real purpose and tried to make it a co- 

 ercive means to compel patronage. Used in that way its presence 

 in the by-laws has served only to antagonize the members, and, quite 

 aside from the legal difficulties which are in the way of enforcing 

 such a provision, it is believed to have outlived its general useful- 

 ness. The patronage dividends in a truly cooperative company 

 should furnish every inducement necessary to secure the patronage 

 of the members without coercive means. 



In case it becomes necessary to meet conditions brought about by 

 other dealers paying more for grain than it actually is worth in 

 order to discredit the cooperative company, a direct personal appeal 

 to the members, stating frankly existing conditions and probable 



