rORM OF ORGANIZATION 23 



fund much in excess of what is actually needed for declaring a 

 fair dividend and for upkeep of the plant. 



Who May Become Stockholders. — Others than patrons of 

 the creamery may own stock in the organization. But the 

 patrons should at all times own its major portion. If the con- 

 trolling interest is held by non-producers, the cooperative 

 features of the organization are likely to be less marked, and 

 the producers are more likely to lose enthusiasm. A creamery 

 that has been organized as a joint-stock company may even- 

 tually be changed into a cooperative creamery by gradually 

 buying up the stock with the money in the sinking fund, if agree- 

 able to the stockholders. It often appeals to a stockholder to 

 know that he may subscribe to stock with the understanding 

 that a definite dividend, say 8 per cent, will be paid annually 

 together with a definite per cent of the capital. He feels more 

 keenly that money thus subscribed is not lost. 



Rights of Stockholders. — Only stockholders of the organi- 

 zation can vote on matters pertaining to the business. Some 

 creameries are so organized that the stockholder has one vote 

 for each share of stock, others come closer to the mutual co- 

 operative association in allowing each member only one vote 

 regardless of the amount of stock he holds. In most creameries 

 of this kind the number of shares that can be held by one in- 

 dividual is limited. 



This form of creamery organization, if conducted as near as 

 possible on the cooperative plan, has the same advantages as 

 the cooperative association; and in places where the townspeople 

 are more aggressive than the farming population, this form is 

 even preferred. This type of creamery association should not 

 be confused with some of the big corporations that provide for 

 a certain amoimt of stock to be sold to producers in different 

 sections of the country. The latter form is not cooperative in 

 any way except in name. The organization is under the absolute 

 control of comparatively few individuals as, even if more than 

 half of the stock were sold to producers, such stockholders are 

 usually scattered so widely that no united action could be 

 carried through by them. 



