996 ARTICLE 23

further that any such bonus to a non-stockholder may be declared in the
form of capital stock, until the amount of such dividends equals the par-
value of one share of the association's stock, dividends thereafter to such
patron being paid in the same manner as dividends to all stockholders;
provided further that such a bonus to a non-stockholder, if it is less than
the par value of one share, shall be credited to the non-stockholders' capital
stock account during the first year and the second year but shall revert to
the reserve fund, if, after two years, an amount less than the par value of
one share has accumulated.

(b) The stockholders at any regular or special meeting, called legally,
may instruct the directors as to what method of apportionment of net profits
to follow under the provision of this section, in so far as these provisions
confer discretion upon the directors.

(c) The directors of any association organized without capital stock
under this sub-title shall provide annually for the distribution of the net
profits, if any, as follows:

(d) After the expenses of the association have been paid and a proper
reserve has been set aside to cover depreciation of the property of the asso-
ciation and for contingent expenses, and to establish a reasonable reserve,
the directors subject to the approval of the members, as provided in sub-
section (e) of this section, may set aside such sums as they deem desirable
for capital expenditures. The directors may then set aside not to exceed five
per cent of the remaining net profits as an educational fund to be used in
teaching cooperation. The directors may then grant a bonus to employees
who are in the employ of the association at the time of the apportionment of
profits, which bonus shall be based in amount upon the amount of com-
pensation received by said employees during the year at any rate not to
exceed the rate of patronage dividends hereinafter described.

The directors shall then distribute all remaining net profits by a uniform
dividend to members of the association based in amount upon the value of
business conducted by such members with the association; provided that the
association may distribute to patrons of the association who are not mem-
bers bonuses based in amount upon the volume of business transacted by
such patrons respectively with the association; provided further that any
such dividend to a non-member may be applied to the payment of member-
ship fees or dues for him; and, if so applied, when such fees are fully
paid a membership certificate shall be issued to him; provided further that
such dividends to a non-member, if it is less than the membership fee, shall
be credited to the non-member's account during the first year and the second
year, but shall revert to the reserve fund if, after two years, an amount less
than the membership fee has accumulated.

(e) The members at any regular or special meeting, legally called, may
instruct the directors concerning the method of apportionment of net profits
to follow under the provision of this section, in so far as these provisions
confer discretion upon the directors.

An. Code, 1924, sec. 441. 1922, ch. 197, sec. 491.

453. (a) Any association organized under this sub-title, as agent to sell
the products of members, may operate upon a non-profit basis by contracting
to pay the members, for products sold by said members to or through the
association, the resale price minus a uniform charge to cover the expenses
involved in the handling of said products; resale price to be the actual resale
price or to be based upon the average price during any period for products