132 CIECULAE 10 0, U. S. DEPARTMENT OF AGEICULTUEE 



ciation at par ; but no member sball purchase originally or directly more than 

 $100 worth of such common stock. The common stock shall have all the voting 

 power of the corporation. 



PREFERRED STOCK HAS NO VOTE, BUT HAS GUARANTEED DIVIDENDS ANYBODY CAN 



BUY PREFERRED STOCK 



(e) The preferred capital stock shall be divided into five equal classes all 

 bearing 8 per cent cumulative dividends and having similar preferences, subject 

 to rerirement with a bonus of 2 per cent, at the rate of one class or one-fifth 

 thereof annually, beginning June, 1923. 



Tlie preferred stock may be sold to any person, firm, or corporation 

 whatsoever. 



LIMITATION ON STOCK ISSUES 



(f) The original issue of preferred stock shall not exceed 1 cent for each 

 pound of tobacco of the 1920 crop, covered by the membership of that district ; 

 but this amount may be increased proportionately as the membership increases. 



FUNCTION OF CORPORATIONS AND RELATIONS TO MARKETING ORGANIZATIONS 



(g) The association shall make a cross contract with the corporation, pro- 

 viding substantially as follows: That the corporation shall handle, process, dry, 

 cure, condition, manufacture, treat, store, ship, and deliver all as required and 

 directed by the association, the tobacco delivered to it by and at the order of 

 the association. Such service will be on a nonprofit basis ; and the corporation 

 shall receive therefor only the actual costs of such operations and amounts, 

 apportioned over the operations of any one season, sufficient to pay a dividend 

 of 8 per cent on the outstanding common stock and the dividends on the out- 

 standing preferred stock and to retire in each of the five calendar years, 

 beginning with 1923, one-fifth of the preferred stock, or one class thereof ; and 

 sufficient amounts for taxes, insurance, depreciation, betterments, and com- 

 mercial and secondary charges, all as the directors of the association may 

 instruct and limit the corporation and not otherwise. The corporation will 

 agree to do no buying or selling of tobacco whatsoever. 



PUBLIC WAREHOUSES 



( h ) Any warehouse shall be conducted as a public warehouse, with such 

 charges as may be imposed through an official body or with such charges as 

 are generally prevalent in the district; and any profits made from such opera- 

 tions as a public warehouse shall be utilized for payment of overhead expenses 

 of the corporation. 



HOW YOU RETIRE PREFERRED STOCK 



(OThe association shall retire each class of preferred stock and pay the 

 dividends on the stock by deductions from the marketing proceeds of the mem- 

 bers within the respective districts in which the warehouses, etc., are built 

 and oi erated. 



If. however, any central plants are purchased, constructed, or leased, or 

 operated for the general benefit of several or all the districts, such deductions 

 shall be made from the proceeds of the several or all districts, as the directors 

 may determine, conclusively, to conform to the general extent of the beneficial 

 purpose. 



GROWERS GET CREDIT FOR ALL DEDUCTIONS TO RETIRE STOCK 



(;) As the preferred stock is retired the association will calculate the value 

 of the contribution from each grower's tobacco toward such retirement and 

 toward pavment of dividends on the common and preferred stock: and the 

 corpo; ation will credit and issue from time to time to each member common 

 stock in an equivalent amount at the book value thereof, as conclusively estab- 

 lished by the directors of the corporation, as soon as the aggregate deductions 

 equal the book value of one or more shares. 



