As Amended
SEC. 79-5-19. Management and control of corporation; board of directors; board of members; executive committee; elections, terms and qualifications; liability for losses.
So long as there are no loans to the corporation by members outstanding, the board of directors shall conduct and manage all business and affairs of the corporation, elect all officers and perform all other acts necessary with reference to the corporation. The board of directors shall have full discretion to determine whether the corporation shall accept commitments of loans from members and to approve or disapprove applications to members to the corporation. To protect the public interest and assure the public purposes intended by the authorizations herein provided, however, it is expressly provided that whenever a corporation created under the provisions of this chapter accepts any loans or commitments of loans from members of the corporation, as herein defined, the control and management of all business and affairs of the corporation, including election of all officers as hereinafter provided, shall be conducted and managed jointly by the board of directors representing the stockholders and a board of members representing the members of the corporation, and such joint management and control of the business and affairs of the corporation shall continue so long as any loan to the corporation by any member of the corporation is outstanding. When all such loans by members have been retired, full control of the business and affairs of the corporation shall revert to the board of directors and the board of members shall thereupon be dissolved.
Such joint control and management of the business and affairs of the corporation by the board of directors and the board of members shall be vested in an executive committee composed of seven (7) individuals who shall hold the office of members of the executive committee. Three (3) of said members of the executive committee shall be elected, and any vacancy in their office filled by the board of directors; and three (3) of said members of the executive committee shall be elected, and any vacancies in their office filled by the board of members. The six (6) members of the executive committee so elected shall elect the seventh member, and the seventh member of the executive committee shall also serve as chairman of the executive committee and as president of the corporation. Such seven (7) members of the executive committee shall then elect all other officers of the corporation excepting the members of the board of directors and members of the board of members, and shall conduct all business and affairs of the corporation in the name of the executive committee of the board of directors and the board of members of the corporation, and may be referred to and conduct such affairs simply as the executive committee of the corporation. Said executive committee shall elect one (1) of its members as secretary, and minutes shall be kept of all of its meetings and copies of said minutes shall be forwarded to the board of directors and the board of members within a reasonable time after each meeting.
The terms of office of members of the executive committee shall be for a period of one (1) year, and their election shall immediately follow the annual election of members of the board of directors of the corporation. The board of members shall be elected by the members of the corporation annually at the same time the members of the board of directors are being elected.
The board of directors shall be elected in the first instance by the incorporators, and thereafter by the stockholders of the corporation at each annual meeting of the corporation, or if no annual meeting shall be held in any year at the time fixed by the bylaws at a special meeting held in lieu of the annual meeting. The directors shall hold office until the next annual meeting of the corporation, or special meeting held in lieu of the annual meeting, after their election, until their successors are elected and qualified unless sooner removed in accordance with the provisions of the bylaws. Any vacancy in the office of director shall be filled upon election by the stockholders at a regular annual meeting or at a special meeting called for such purpose.
The board of members shall be elected by the members of the corporation at the time of the annual election of the board of directors of the corporation or at a special meeting held after ten (10) days' written notice mailed to each member of the corporation setting the time and place for such election if it is necessary to elect the board of members at a time other than the annual meeting of stockholders for the election of the board of directors.
The board of members shall consist of such number, not less than six (6) nor more than twelve (12), as shall be determined by the members, and at least one (1) member of the board of members shall be from each congressional district in the state. The members of the board of members shall hold office until the next annual meeting of the corporation, or special meeting held in lieu of the annual meeting, after their election, until their successors are elected and qualified, unless sooner removed in accordance with the provisions of the bylaws. Any vacancy in an office of a member of the board of members shall be filled by election by the board of members.
No person shall serve both as a member of the board of directors and as a member of the board of members; however, a member of the board of directors or a member of the board of members may serve on the executive committee and also as an officer of the corporation.
Directors, members and officers shall not be responsible for losses unless the losses shall have been occasioned by the willful misconduct of such directors, members or officers.
SOURCES: Codes, 1942, Sec. 5390-10; Laws, 1960, ch. 186, Sec. 10; 1970, ch. 312, Sec. 1, eff from and after passage (approved February 19, 1970).