Chapter 185

185.038(2) (2) Regardless of the existence of an additional right under sub. (1), the cooperative may not indemnify a director or officer, or permit a director or officer to retain any allowance of expenses unless it is determined by or on behalf of the cooperative that the director or officer did not breach or fail to perform a duty he or she owes to the cooperative which constitutes conduct under s. 185.035 (2) (a) 1., 2., 3. or 4. A director or officer who is a party to the same or related proceeding for which indemnification or an allowance of expenses is sought may not participate in a determination under this subsection.

185.038(3) (3) Sections 185.034 to 185.042 do not affect a cooperative’s power to pay or reimburse expenses incurred by a director or officer in any of the following circumstances:

185.038(3)(a) (a) As a witness in a proceeding to which he or she is not a party.

185.038(3)(b) (b) As a plaintiff or petitioner in a proceeding because he or she is or was an employee, agent, director or officer of the cooperative.

185.038 History History: 1987 a. 13.

185.039 185.039 Court-ordered indemnification.

185.039(1) (1) Except as provided otherwise by written agreement between the director or officer and the cooperative, a director or officer who is a party to a proceeding may apply for indemnification to the court conducting the proceeding or to another court of competent jurisdiction. Application shall be made for an initial determination by the court under s. 185.036 (5) or for review by the court of an adverse determination under s. 185.036 (1), (2), (3), (4) or (6). After receipt of an application, the court shall give any notice it considers necessary.

185.039(2) (2) The court shall order indemnification if it determines any of the following:

185.039(2)(a) (a) That the director or officer is entitled to indemnification under s. 185.035 (1) or (2). If the court also determines that the cooperative unreasonably refused the director’s or officer’s request for indemnification, the court shall order the cooperative to pay the director’s or officer’s reasonable expenses incurred to obtain the court-ordered indemnification.

185.039(2)(b) (b) That the director or officer is fairly and reasonably entitled to indemnification in view of all the relevant circumstances, regardless of whether indemnification is required under s. 185.035 (2).

185.039 History History: 1987 a. 13.

185.04 185.04 Indemnification and allowance of expenses of employees and agents. A cooperative may indemnify and allow reasonable expenses of an employee or agent who is not a director or officer to the extent provided by the articles or bylaws, by general or specific action of the board or by contract.

185.04 History History: 1987 a. 13.

185.041 185.041 Insurance. A cooperative may purchase and maintain insurance on behalf of an individual who is an employee, agent, director or officer of the cooperative against liability asserted against and incurred by the individual in his or her capacity as an employee, agent, director or officer, or arising from his or her status as an employee, agent, director or officer, regardless of whether the cooperative is required or authorized to indemnify or allow expenses to the individual against the same liability under ss. 185.035, 185.037, 185.038 and 185.04.

185.041 History History: 1987 a. 13.

185.042 185.042 Indemnification and insurance against securities law claims.

185.042(1) (1) It is the public policy of this state to require or permit indemnification, allowance of expenses and insurance for any liability incurred in connection with a proceeding involving securities regulation described under sub. (2) to the extent required or permitted under ss. 185.034 to 185.041.

185.042(2) (2) Sections 185.034 to 185.041 apply, to the extent applicable to any other proceeding, to any proceeding involving a federal or state statute, rule or regulation regulating the offer, sale or purchase of securities, securities brokers or dealers, or investment companies or investment advisers.

185.042 History History: 1987 a. 13.

185.043 185.043 Incorporators.

185.043(1) (1) Except as provided in sub. (2), 5 or more adults, one of whom must be a resident, may form a cooperative by signing, acknowledging and filing articles.

185.043(2) (2) If the cooperative is formed for purposes of operating as a small cooperative wholesaler under s. 125.545, 3 or more individuals, at least one of whom must be a resident and all of which must be owners of small wineries or small manufacturers certified by the division of alcohol beverages in the department of revenue under s. 125.545 (6) (a), may form a cooperative by signing, acknowledging, and filing articles. Membership in a cooperative formed under this subsection is limited to small wineries or small manufacturers certified by the division of alcohol beverages under s. 125.545 (6) (a).

185.043 History History: 1981 c. 337; 1985 a. 30 s. 42; 1987 a. 13 s. 23; Stats. 1987 s. 185.043; 2007 a. 85; 2023 a. 73.

185.045 185.045 Reserved or registered name. Sections 180.0122 (1m) (c) to (i), 180.0402 and 180.0403 (2), (3), (3m) and (4) (b) apply to cooperatives, with the word “cooperative” substituted for the words “corporate” and “corporation”.

185.045 History History: 1985 a. 338; 1989 a. 303; 1993 a. 331; 2021 a. 258.

185.05 185.05 Articles.

185.05(1) (1) The articles shall set forth:

185.05(1)(a) (a) The name of the cooperative.

185.05(1)(b) (b) The period of existence, unless perpetual.

185.05(1)(c) (c) The purposes for which organized. It is sufficient to state that the cooperative may engage in any activity within the purposes for which cooperatives may be organized, and all such activities shall then be deemed within its purposes, subject to express limitations.

185.05(1)(d) (d) Whether the cooperative is organized with or without capital stock.

185.05(1)(e) (e) The designation of classes of members, if more than one.

185.05(1)(f) (f) The number and par value of shares of each authorized class of stock; if more than one class is authorized, the designation, preferences, limitations and relative rights of each class shall also be set forth.

185.05(1)(g) (g) Which classes of stock are membership stock.

185.05(1)(h) (h) As to each class of stock, the rate of dividend, or that the rate of dividend may be fixed by the board, or that no dividend will be paid. If the dividend on any class of stock is to be cumulative, this shall also be stated.

185.05(1)(i) (i) Any reservation of a right to acquire or recall any stock.

185.05(1)(j) (j) The basis of distribution of assets upon liquidation and, if changes in the basis of distribution are to be prohibited, a statement that this provision may not be changed and a reference to the restriction under s. 185.033.

185.05(1)(k) (k) The complete address, including street number, city, town or village, county and zip code of its principal office or the name and complete address, including street number, city, town or village, county and zip code of its registered agent.

185.05(1)(L) (L) The name and address of each incorporator.

185.05(1)(m) (m) The names and addresses of at least 5 incorporators who will act as the temporary board.

185.05(2) (2) It is not necessary to set forth in the articles any of the powers granted by this chapter. The articles may include additional provisions, consistent with law, including provisions which are required or permitted to be set forth in the bylaws. Any provision required or permitted in the bylaws has equal force and effect if stated in the articles. Whenever a provision of the articles is inconsistent with a bylaw, the articles control.

185.05(3) (3) The articles shall be filed and recorded as provided in s. 185.82. The legal existence of a cooperative begins when the articles are filed. Upon the filing of the articles, the department shall issue a certificate of incorporation. The department shall forward within 5 days a duplicate original of the articles to the register of deeds of the county of the cooperative’s principal office or registered agent for recording.

185.05(4) (4) The certificate of incorporation shall be conclusive evidence, except as against this state in a proceeding to cancel or revoke such certificate, that all conditions precedent to existence have been met.

185.05 History History: 1981 c. 337; 1985 a. 30 ss. 9, 10, 42; 1985 a. 274; 1995 a. 27.

185.05 Cross-reference Cross-reference: See s. 182.01 (3) for provision that certain corporate documents may not be filed with secretary of state unless they bear the drafter’s name.

185.06 185.06 Organization meetings.

185.06(1) (1) After articles have been filed, an organization meeting of the temporary board shall be held at the call of a majority of the incorporators or of a majority of the temporary directors for the adoption of bylaws, election of temporary officers, and transaction of other business.

185.06(2) (2) The first meeting of the members shall be called by the temporary president or a majority of the temporary directors. Such meeting shall be held as soon as reasonably possible after the organization meeting of the temporary board, but not later than 6 months after filing the articles. Failure to hold such meeting within the time specified does not affect the validity of organization.

185.06 History History: 1981 c. 337.

185.07 185.07 Bylaws.

185.07(1) (1) The initial bylaws may be adopted by the temporary board. Thereafter, except as provided in sub. (4), bylaws may be adopted and amended only by the members unless the members adopt a bylaw which permits the board to make and amend specified bylaws.

185.07(2) (2) Any bylaw adopted or amended by the board shall be reported at the next regular member meeting. Any such bylaw shall be at any time subject to amendment or repeal by the members.

185.07(3) (3) Unless the bylaws provide otherwise, any bylaw may be adopted, amended or repealed by a majority of the member votes cast at a meeting.

185.07(4) (4) 

185.07(4)(a) (a) In this subsection, “emergency” means a catastrophic event that prevents a quorum of a cooperative’s directors or members from being readily assembled.

185.07(4)(b) (b) Unless the articles provide otherwise, the board may adopt bylaws that are effective only in an emergency. Emergency bylaws are subject to amendment or repeal by the board or by the members. Emergency bylaws may provide special provisions or modify provisions as necessary for managing the cooperative during the emergency including any of the following:

185.07(4)(b)1. 1. Procedures for calling a meeting of the board or the members.

185.07(4)(b)2. 2. Procedures for the conduct of a meeting of the board or the members.

185.07(4)(b)3. 3. Quorum requirements for a meeting of the board.

185.07(4)(b)4. 4. Deadlines for any action required to be taken by the cooperative, the board, or the members.

185.07(4)(b)5. 5. Designation of additional or substitute directors.

185.07(4)(c) (c) Provisions of the regular bylaws that are consistent with the emergency bylaws remain effective during the emergency. The emergency bylaws are not effective after the emergency ends.

185.07(4)(d) (d) Action taken in good faith in accordance with the emergency bylaws, and action taken in good faith under s. 185.03 (13) for the benefit of the cooperative, binds the cooperative and may not be used to impose liability on a director, officer, member, employee, or agent. Action taken in good faith in anticipation of or during an emergency to delay or reschedule any action required to be taken by the cooperative, the board, or the members under par. (b) 4. shall not constitute a violation of the bylaws in the event the delayed or rescheduled action occurs after the emergency ends.

185.07 History History: 1985 a. 30; 2021 a. 5.

185.08 185.08 Principal office; registered agent; service of process.

185.08(1) (1) A cooperative shall maintain in this state either its principal office or a registered agent.

185.08(2) (2) 

185.08(2)(a) (a) The board may establish or change the location of the principal office or name and address of the registered agent by causing a statement in writing to be filed and recorded as an amendment to the articles as provided in s. 185.82. Such statement shall set forth the name of the cooperative, and the mailing address and county of its principal office or the name and address, including the county, of the registered agent as established or changed.

185.08(2)(b) (b) If a statement under par. (a) results from the action of a governmental agency in changing the address of the principal office or registered agent and there is no corresponding change in physical location, these facts shall be contained in the statement.

185.08(3) (3) A registered agent may resign by mailing a written notice to both the department and the cooperative. The resignation becomes effective when the cooperative names a new registered agent or 60 days after the receipt of notice by the department, whichever is sooner.

185.08(4) (4) Service of any process, notice or demand upon a cooperative may be made as provided in s. 180.0504 or ch. 801.

185.08 History History: Sup. Ct. Order, 67 Wis. 2d 585, 775 (1975); 1981 c. 337; 1983 a. 134; 1989 a. 303; 1995 a. 27.

185.09 185.09 Promotion expense; limitation. No cooperative funds may be used, nor any stock issued, in payment of any promotion expenses in excess of 5 percent of the paid-up capital stock or membership fees. This section does not apply to a cooperative association organized under s. 185.981.

185.09 History History: 2009 a. 165, 177; 2011 a. 258.

185.11 185.11 Membership.

185.11(1) (1) All cooperatives shall be organized on a membership basis with no capital stock, or shall be organized on a membership basis with capital stock.

185.11(2) (2) A cooperative may have one or more classes of members. The designation, qualifications, requirements, method of acceptance, and incidents of membership of each class shall be set forth in the bylaws. Any person, including a partnership, incorporated or unincorporated association, limited liability company, corporation, or body politic, may become a member in accordance with the bylaws.

185.11(3) (3) No member may transfer his or her membership except as permitted in the bylaws.

185.11(4) (4) The bylaws may provide for termination of membership and the conditions and terms thereof.

185.11 History History: 1985 a. 30 ss. 12, 42; 1993 a. 112, 482.

185.12 185.12 Voting.

185.12(1) (1) Except as permitted in this section, s. 185.52, 185.61 or 185.63, no person other than a member may vote at any member meeting. A person who has not fully paid for a membership may not vote except as expressly permitted in the bylaws. If the cooperative permits 2 or more persons to hold one membership, the bylaws may provide how such member vote is to be cast.

185.12(2) (2) At any member meeting, each member entitled to vote shall have one vote, except that the articles may permit either or both:

185.12(2)(a) (a) A member association to cast additional votes not exceeding a number equal to its membership.

185.12(2)(b) (b) A cooperative whose member-patrons include other associations to base voting in whole or in part on a patronage basis.

185.12(3) (3) Voting by proxy shall not be allowed in any cooperative.

185.12(4) (4) 

185.12(4)(a) (a) The bylaws may provide for representation of members by delegates apportioned territorially or by other districts or units. The bylaws shall specify either that a delegate may cast only one vote or that a delegate may cast one vote for each member represented by the delegate.

185.12(4)(b) (b) The procedures set forth in this chapter for voting by members apply to voting by delegates, except as provided in all of the following: