4:13-33. Dividends and division of balance of associations with capital stock

299 words·~1 min read·/nj/title-4/chapter-13/4-13-33

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In the case of associations with capital stock, after payment of expenses and the establishment of the funds, as authorized in section 4:13-31 of this Title, and as near or as soon after the end of the fiscal year as possible there shall be paid to the members out of the income of the association an interest dividend not exceeding 8% of the par value of the stock held by them at the end of the fiscal year. The whole balance then remaining after the payment of interest dividend shall be divided among those patrons, members and nonmember producers and may include nonproducers on the basis of patronage, in the proportion that the volume of business done for such patrons by the association during the fiscal year bears to the total volume of business transacted by the association during the fiscal year; provided, however, that the association, instead of making such division among the member and nonmember producers in cash, may keep a permanent record from which the proportionate shares due to members and nonmember producers can be determined, as part of a reserve for patrons' revolving fund, which may be evidenced by certificates or notices and, in the case of nonmember producer patrons, such shares may be made applicable toward the purchase price of a share or shares of stock of a membership in the association.

In calculating the amount to be paid to nonstockholders, upon whom liability for the debts of the association has not been imposed as authorized by section 4:13-30 of this Title, such sum shall be deducted as in the opinion of the directors is a reasonable charge in lieu of such liability.

Amended by L.1940, c. 146, p. 312, s. 3; L.1951, c. 303, p. 1090, s. 6; L.1966, c. 286, s. 30.