SF 4944

Introduction - 94th Legislature (2025 - 2026)

Posted on 04/08/2026 09:17 a.m.

A bill for an act
relating to housing cooperatives; modifying the organization and operation of
housing cooperatives; addressing member violations; requiring certain disclosures
and notice; permitting a purchaser to cancel; establishing express and implied
warranties; requiring insurance; requiring upkeep; making clarifying, technical,
and conforming changes; amending Minnesota Statutes 2024, sections 308C.003,
by adding subdivisions; 308C.005, subdivisions 4, 7, 9, 10, 12, 13, 22, 23, 27, 29,
31, 33, 41, 43, 46, 47, 48, by adding subdivisions; 308C.009, subdivision 1;
308C.201; 308C.205; 308C.215, subdivisions 1, 3; 308C.221, subdivisions 1, 3,
4; 308C.225, subdivisions 1, 2, 3; 308C.241, subdivisions 1, 2, by adding a
subdivision; 308C.245; 308C.301, subdivisions 1, 2; 308C.311; 308C.312;
308C.401; 308C.405; 308C.411, subdivision 1; 308C.415, subdivision 1; 308C.421,
subdivision 3; 308C.425, subdivision 2; 308C.441, subdivision 1; 308C.451,
subdivisions 1, 2; 308C.471, subdivisions 4, 6; 308C.475, subdivisions 1, 5;
308C.501, subdivisions 1, 2, by adding a subdivision; 308C.505; 308C.511,
subdivisions 1, 3; 308C.525, subdivision 1; 308C.531, subdivisions 2, 6; 308C.535,
subdivisions 1, 2; 308C.541, subdivision 1; 308C.545, subdivisions 3, 5, by adding
subdivisions; 308C.601, subdivisions 2, 6, by adding subdivisions; 308C.602;
308C.603, subdivisions 1, 4, by adding a subdivision; 308C.612, subdivisions 1,
2, 3, by adding subdivisions; 308C.613, subdivisions 1, 2; 308C.614; 308C.615;
308C.625, subdivisions 1, 2; 308C.801, as amended; 308C.835; 308C.902,
subdivision 2; 308C.905, subdivision 1; 308C.925; 308C.935, subdivision 2;
308C.941, subdivision 2; 515B.1-102; Minnesota Statutes 2025 Supplement,
sections 308C.411, subdivision 2; 308C.545, subdivision 1; 308C.571, subdivision
1; 515B.3-101; 515B.3-103; proposing coding for new law in Minnesota Statutes,
chapter 308C; repealing Minnesota Statutes 2024, sections 308C.003, subdivision
3; 308C.005, subdivisions 8, 20, 32, 34, 36, 37, 38, 42, 44; 308C.241, subdivisions
3, 4, 5, 6; 308C.301, subdivisions 3, 4, 5, 6, 7, 10, 11, 12; 308C.411, subdivisions
5, 6; 308C.415, subdivision 2; 308C.501, subdivisions 3, 4; 308C.502; 308C.601,
subdivisions 1, 3, 5, 7; 308C.605; 308C.611; 308C.612, subdivisions 4, 5, 6;
308C.616; 308C.627; 308C.701; 308C.705; 308C.711; 308C.715; 308C.721,
subdivision 1; 308C.725; 308C.805; Minnesota Statutes 2025 Supplement, sections
308C.301, subdivisions 8, 9, 13; 308C.721, subdivision 2.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2024, section 308C.003, is amended by adding a subdivision
to read:

new text begin Subd. 4. new text end

new text begin Homestead exemption. new text end

new text begin Membership interests in cooperatives governed by
this chapter are wholly personal property. The characterization of these interests as personal
property must not affect whether homestead exemptions or classifications apply. Membership
interests are granted homestead exemptions to the same extent as any other dwelling or
house is entitled to that exemption. The ownership interest in a membership, which may be
sold, conveyed, voluntarily or involuntarily encumbered, or otherwise transferred by the
owner, is supplemented with an appurtenant right of occupancy of a particular unit in the
cooperative's project under a proprietary lease in addition to the allocated interests of the
unit or membership. The cooperative's interest in the unit is not affected by the transaction.
Each individual unit constitutes a homestead and is exempt from execution if the member
would otherwise qualify for the exemption within the laws of the state.
new text end

Sec. 2.

Minnesota Statutes 2024, section 308C.003, is amended by adding a subdivision
to read:

new text begin Subd. 5. new text end

new text begin Taxation. new text end

new text begin The cooperative's real estate is taxed in the name of the cooperative.
Each member must pay the member's proportionate share of the tax in accordance with the
proration formula set forth in the cooperative's bylaws. Each member occupying a unit as
a residence shall receive the member's proportionate homestead tax exemption and credit
if the member would otherwise qualify for the exemption within the laws of the state.
new text end

Sec. 3.

Minnesota Statutes 2024, section 308C.005, subdivision 4, is amended to read:

Subd. 4.

Articles.

"Articles" means the articles of deleted text begin organization deleted text end new text begin incorporation new text end of a
cooperative as originally filed and subsequently amended.

Sec. 4.

Minnesota Statutes 2024, section 308C.005, is amended by adding a subdivision
to read:

new text begin Subd. 4a. new text end

new text begin Assessment. new text end

new text begin "Assessment" means all sums chargeable by the cooperative
against a membership or unit, including monthly charges payable by each member to the
cooperative pursuant to the terms of a proprietary lease to cover the cooperative's operating
expenses, real estate taxes, insurance deposits to the replacement and general operating
reserves, mortgage debt service on any blanket mortgage on the cooperative's project, other
monthly common expense assessments, special assessments, fines or fees levied or imposed
by the cooperative pursuant to this chapter or the cooperative's governing documents, interest
and late charges on any delinquent account, and the costs of collection incurred by the
cooperative in connection with the collection of a delinquent member's account, including
reasonable attorney fees.
new text end

Sec. 5.

Minnesota Statutes 2024, section 308C.005, subdivision 7, is amended to read:

Subd. 7.

Business entity.

"Business entity" means a new text begin corporation, new text end company, limited
liability company, limited liability partnership, or other legal entity, whether domestic or
foreign, association, or body vested with the power or function of a legal entity.

Sec. 6.

Minnesota Statutes 2024, section 308C.005, subdivision 9, is amended to read:

Subd. 9.

Cooperative.

"Cooperative" means deleted text begin a cooperative deleted text end new text begin an association new text end organized
under this chapter deleted text begin providing deleted text end new text begin to provide new text end housing opportunities on a cooperative plan as
provided under this chapter.

Sec. 7.

Minnesota Statutes 2024, section 308C.005, subdivision 10, is amended to read:

Subd. 10.

Common elements.

"Common elements" means all portions of the deleted text begin cooperative deleted text end new text begin
cooperative's project new text end other than a dwelling unit new text begin , a lot, new text end or a manufactured home new text begin that is occupied
as a residence new text end .

Sec. 8.

Minnesota Statutes 2024, section 308C.005, subdivision 12, is amended to read:

Subd. 12.

Common expense liability.

"Common expense liability" means the liability
for common expenses allocated to each deleted text begin dwelling deleted text end unit new text begin , new text end which shall be allocated by a method
provided for in the bylaws pursuant to section 308C.241, subdivision 2, paragraph (a), clause
7.

Sec. 9.

Minnesota Statutes 2024, section 308C.005, subdivision 13, is amended to read:

Subd. 13.

Developer.

"Developer" means a deleted text begin real estate developer in the business of
building dwelling deleted text end new text begin person who builds new text end units that will be owned and operated by a cooperative
organized under this chapter.

Sec. 10.

Minnesota Statutes 2024, section 308C.005, subdivision 22, is amended to read:

Subd. 22.

Limited equity new text begin appreciation new text end cooperative.

"Limited equity new text begin appreciation
new text end cooperative" means a cooperative deleted text begin governed by this chapter that limits the appreciation and
value of a membership interest to a formula price set forth in the bylaws that is defined as
the transfer value herein. A limited equity cooperative also sets limits on the extent to which
a member may transfer a membership interest and provides for a right of first refusal to
purchase the interest in favor of the cooperative. deleted text end new text begin whose bylaws or articles:
new text end

new text begin (1) contain a transfer value formula that limits the appreciation, value, and price of a
membership for sales or transfer purposes;
new text end

new text begin (2) limit the extent to which a member may transfer a membership interest; and
new text end

new text begin (3) provide for a right of first refusal or an option in favor of the cooperative to purchase
or assign to a buyer approved by the cooperative, the cooperative's right to purchase the
membership of a deceased or departing member.
new text end

Sec. 11.

Minnesota Statutes 2024, section 308C.005, subdivision 23, is amended to read:

Subd. 23.

Low income.

"Low income" means deleted text begin having deleted text end income that is less than or equal
to 80 percent of new text begin area new text end median income deleted text begin for the area deleted text end , adjusted for family size, deleted text begin in accordance
with federal standards generally accepted at the time of organization and comparable to
standards of deleted text end new text begin as published annually by new text end the United States Department of Housing and Urban
Development deleted text begin existing on June 16, 1988 deleted text end .

Sec. 12.

Minnesota Statutes 2024, section 308C.005, is amended by adding a subdivision
to read:

new text begin Subd. 26a. new text end

new text begin Market rate cooperative. new text end

new text begin "Market rate cooperative" means a cooperative
whose bylaws or articles either:
new text end

new text begin (1) impose no limitations on the valuation or sales price of a membership for sale or
transfer purposes; or
new text end

new text begin (2) contain a transfer value formula that limits the appreciation, value, and price of a
membership for sales or transfer purposes. The transfer value may govern some or all
membership sales under circumstances, conditions, or limitations enumerated in the
cooperative's bylaws or articles.
new text end

new text begin A market rate cooperative may set limits on the extent that a member may transfer a
membership interest and provide for an option or first privilege in favor of the cooperative
to purchase the membership or assign to a buyer approved by the cooperative, the
cooperative's right to purchase the membership of a deceased or departing member.
new text end

Sec. 13.

Minnesota Statutes 2024, section 308C.005, subdivision 27, is amended to read:

Subd. 27.

Member.

"Member" means any person who is approved for membership in
the cooperative pursuant to the articles deleted text begin of organization deleted text end or bylaws and who is identified as
a member on the books and records of the cooperative and has been issued a membership
certificate. deleted text begin Membership certificates include owner members and nonoccupant members.
deleted text end

Sec. 14.

Minnesota Statutes 2024, section 308C.005, subdivision 29, is amended to read:

Subd. 29.

Membership interest.

"Membership interest" means deleted text begin a member's interest in
a cooperative consisting of a member's financial rights, a member's right to assign financial
rights, a member's governance rights, and a member's right to assign governance rights.
Membership interest includes occupant membership interests and nonoccupant membership
interests. deleted text end new text begin the composite ownership of both a membership certificate issued by the cooperative
and a possessory right of occupancy of a unit pursuant to a proprietary lease, including a
member's financial rights and a member's governance rights.
new text end

Sec. 15.

Minnesota Statutes 2024, section 308C.005, subdivision 31, is amended to read:

Subd. 31.

Membership purchase and sale agreement.

"Membership purchase and sale
agreement" means deleted text begin the deleted text end new text begin a new text end contract for purchase of a membership interest to which a particular
deleted text begin dwelling deleted text end unit is appurtenant between deleted text begin the member who is selling the membership interest
and an incoming prospective member of the cooperative who has been approved for
membership by the cooperative's board of directors. deleted text end new text begin a purchaser and the departing member.
Membership purchase and sale agreements may also include the cooperative as a party when
the cooperative is assigning the cooperative's option or first privilege to purchase the
membership to the buyer purchasing the membership from the departing member.
new text end

Sec. 16.

Minnesota Statutes 2024, section 308C.005, subdivision 33, is amended to read:

Subd. 33.

Moderate income.

"Moderate income" means less than or equal to 100 percent
of new text begin area new text end median income deleted text begin for the area deleted text end , adjusted for family size, deleted text begin in accordance with federal
standards generally accepted at the time of organization and comparable to standards of deleted text end new text begin as
published annually by new text end the United States Department of Housing and Urban Development
deleted text begin existing on June 16, 1988 deleted text end .

Sec. 17.

Minnesota Statutes 2024, section 308C.005, subdivision 41, is amended to read:

Subd. 41.

Proprietary lease.

"Proprietary lease" means an new text begin occupancy new text end agreement with
a cooperative governing a member's right to occupancy under which a member has an
exclusive possessory interest in a unit deleted text begin or lot deleted text end .

Sec. 18.

Minnesota Statutes 2024, section 308C.005, is amended by adding a subdivision
to read:

new text begin Subd. 41a. new text end

new text begin Purchase agreement. new text end

new text begin "Purchase agreement" means the contract for purchase
of a membership interest to which a particular unit is appurtenant, including subscription
agreements and membership purchase and sale agreements.
new text end

Sec. 19.

Minnesota Statutes 2024, section 308C.005, subdivision 43, is amended to read:

Subd. 43.

Security interest.

"Security interest" means the lien on and security interest
in a membership new text begin interest new text end and deleted text begin occupancy agreement deleted text end new text begin appurtenant proprietary lease new text end .

Sec. 20.

Minnesota Statutes 2024, section 308C.005, subdivision 46, is amended to read:

Subd. 46.

Subscription agreement.

"Subscription agreement" means the contract of
purchase between a deleted text begin prospective member deleted text end new text begin purchaser new text end and the cooperative of a membership
interest in the cooperative new text begin to which a particular unit is appurtenant new text end .

Sec. 21.

Minnesota Statutes 2024, section 308C.005, is amended by adding a subdivision
to read:

new text begin Subd. 46a. new text end

new text begin Transfer. new text end

new text begin "Transfer" means any proposed disposition of a membership,
including, without limitation, disposition by will, gift, sale, exchange, distribution by personal
representative or trustee, or passage or distribution under judicial order by legal process. A
transfer does not include succession to an interest by reason of death of a joint tenant,
succession to a surviving transfer on death beneficiary, or the termination of a life estate.
new text end

Sec. 22.

Minnesota Statutes 2024, section 308C.005, subdivision 47, is amended to read:

Subd. 47.

Transfer value.

"Transfer value" means deleted text begin the formula price at which the
cooperative may purchase the membership interest of a deceased or departing member in
a limited equity cooperative deleted text end new text begin a membership's value, for sale or transfer purposes, as established
by a formula and circumstances enumerated in the bylaws or articles of a cooperative new text end .

Sec. 23.

Minnesota Statutes 2024, section 308C.005, is amended by adding a subdivision
to read:

new text begin Subd. 47a. new text end

new text begin Transfer value formula. new text end

new text begin "Transfer value formula" means the formula
contained in the bylaws or articles of a cooperative for establishing a membership's transfer
value.
new text end

Sec. 24.

Minnesota Statutes 2024, section 308C.005, subdivision 48, is amended to read:

Subd. 48.

Unit.

"Unit" means a portion of the cooperative deleted text begin property deleted text end new text begin project new text end leased for
exclusive occupancy by a member under a proprietary lease deleted text begin or leased to a tenant by an
occupancy agreement deleted text end . new text begin Unit includes but is not limited to dwelling units and lots.
new text end

Sec. 25.

Minnesota Statutes 2024, section 308C.009, subdivision 1, is amended to read:

Subdivision 1.

Permissible uses.

deleted text begin Businesses deleted text end new text begin (a) Cooperatives new text end subject to this chapter
may use the term "cooperative" or "housing cooperative" as part of its corporate or business
name. Nothing in this chapter shall preclude a deleted text begin business deleted text end new text begin cooperative new text end organized under chapter
308A deleted text begin , deleted text end new text begin or new text end 308B deleted text begin , 317A, or 515B deleted text end from using the term "housing cooperative."

new text begin (b) new text end A deleted text begin corporation or association deleted text end new text begin cooperative new text end organized in this state may not use the term
"housing cooperative" as part of its corporate or business name or title, or to represent itself
as a housing cooperative, unless the deleted text begin corporation or association deleted text end new text begin cooperative new text end has complied
with and is subject to this chapter or has deleted text begin incorporated under the laws of this state authorizing
incorporation of business on a cooperative plan deleted text end new text begin organized under chapter 308A or 308B new text end .

Sec. 26.

Minnesota Statutes 2024, section 308C.201, is amended to read:

308C.201 ORGANIZATIONAL PURPOSE.

A cooperative may be formed and organized deleted text begin on a cooperative basis and plan deleted text end under this
chapter deleted text begin :
deleted text end

deleted text begin (1) to provide housing on a nonprofit and cooperative basis to older persons in accordance
with the provisions of this chapter, the Fair Housing Act, Title VIII of the Civil Rights Act
of 1968, as amended; United States Code, title 42, chapter 3607, section 807(a)(b)(1)(2),
and the rules and regulations of the United States Department of Housing and Urban
Development applicable with respect to housing for older persons contained in Code of
Federal Regulations, title 24, subtitle B, chapter I, subpart E, sections 100.300-308;
deleted text end

deleted text begin (2) deleted text end to provide new text begin residential housing new text end on a new text begin cooperative and new text end nonprofit deleted text begin and cooperative deleted text end basis
deleted text begin residential housing either through ownership, leasing, or a combination of both and the
social, recreational, commercial, and communal facilities necessary to serve and improve
the residential housing; deleted text end or new text begin not-for-profit basis in accordance with the provisions of this
chapter. A cooperative formed under this chapter may be organized as a limited equity
appreciation cooperative or a market rate cooperative.
new text end

deleted text begin (3) to establish a limited equity cooperative that provides on a nonprofit and cooperative
basis residential housing to its members that: (i) limits the appreciation and value of a
membership interest to a formula price set forth in the bylaws that is defined as the transfer
value herein, and (ii) sets limits on the extent to which a member may transfer a membership
interest and provides for a right of first refusal to purchase the interest in favor of the
cooperative.
deleted text end

Sec. 27.

Minnesota Statutes 2024, section 308C.205, is amended to read:

308C.205 new text begin INCORPORATORS OR new text end ORGANIZERS.

A cooperative may be organized by one or more new text begin incorporators or new text end organizers who shall
be adult natural persons and who may act for themselves as individuals or as agents of other
entities.

Sec. 28.

Minnesota Statutes 2024, section 308C.215, subdivision 1, is amended to read:

Subdivision 1.

Requirements.

(a) The articles of the cooperative shall include:

(1) the name new text begin and principal place of business new text end of the cooperative;

(2) the organizational purpose of the cooperative in accordance with this chapter;

(3) the name and address of each deleted text begin organizer deleted text end new text begin initial director and incorporator new text end ;

(4) the period of duration for the cooperative, if the duration is not to be perpetual;

(5) the name and address of the registered agent, if any; and

(6) the address of the registered office.

(b) The articles of the cooperative may include:

(1) a statement that assessments to members collected annually for common expenses
in excess of common expenses shall be refunded annually on the basis of patronage, which
may, upon resolution of the board of directors, be credited to the following year's
assessments; deleted text begin and
deleted text end

(2) if the cooperative is to be organized as a limited equity new text begin appreciation new text end cooperative, the
requirements set forth in section 308C.312 deleted text begin . deleted text end new text begin ; and
new text end

deleted text begin (c) The articles may contain deleted text end new text begin (3) new text end any other lawful provision.

deleted text begin (d) deleted text end new text begin (c) new text end The articles shall be signed by each new text begin incorporator or new text end organizer.

Sec. 29.

Minnesota Statutes 2024, section 308C.215, subdivision 3, is amended to read:

Subd. 3.

Effect of filing.

When the articles have been filed with the secretary of state
and the required fee has been paid to the secretary of state, it shall be presumed that:

(1) all conditions precedent that are required to be performed by the organizers have
been complied with;

(2) the incorporation of the cooperative has been chartered by the state as a separate
legal entity; and

(3) the secretary of state shall issue a certificate of deleted text begin organization deleted text end new text begin incorporation new text end to the
cooperative.

Sec. 30.

Minnesota Statutes 2024, section 308C.221, subdivision 1, is amended to read:

Subdivision 1.

Procedure.

(a) The articles of a cooperative shall be amended as follows:

(1) the board, by majority vote, shall pass a resolution stating the text of the proposed
amendment. The text of the proposed amendment and an attached deleted text begin mail deleted text end new text begin mailed new text end or alternative
ballot, if the board has provided for a mail or alternative ballot in the resolution, shall be
mailed or otherwise distributed with a regular or special meeting notice to each member.
The notice shall designate the time and place of the meeting for the proposed amendment
to be considered and voted on; and

(2) if a quorum of the members is registered as being present or represented by alternative
deleted text begin vote deleted text end new text begin ballot new text end at the meeting, the proposed amendment is adopted:

(i) if approved by a majority of the votes cast; or

(ii) for a cooperative with articles or bylaws requiring more than majority approval or
other conditions for approval, the amendment is approved by a proportion of the votes cast
or a number of total members as required by the articles or bylaws and the conditions for
approval in the articles or bylaws have been satisfied.

(b) After an amendment has been adopted by the members, the amendment shall be
signed by the president and secretary and a copy of the amendment filed with the secretary
of state.

Sec. 31.

Minnesota Statutes 2024, section 308C.221, subdivision 3, is amended to read:

Subd. 3.

Amendment by directors.

A majority of directors may amend the articles if
the cooperative does not have any members new text begin with voting rights new text end .

Sec. 32.

Minnesota Statutes 2024, section 308C.221, subdivision 4, is amended to read:

Subd. 4.

Amendment by the deleted text begin organizer deleted text end new text begin incorporator new text end .

The deleted text begin organizer deleted text end new text begin incorporator new text end or
a majority of the deleted text begin organizers deleted text end new text begin incorporators new text end may amend the articles if the cooperative does
not have directors or any members.

Sec. 33.

Minnesota Statutes 2024, section 308C.225, subdivision 1, is amended to read:

Subdivision 1.

Authority.

(a) A deleted text begin housing deleted text end cooperative organized under chapter 308A or
308B may convert and become exclusively subject to this chapter by amending the deleted text begin housing deleted text end
cooperative's organizational documents to conform to the requirements of this chapter and
filing a certificate of conversion that complies with this chapter.

(b) A deleted text begin housing deleted text end cooperative organized under chapter 308A or 308B that intends to convert
to a cooperative subject to this chapter must provide its members with a disclosure statement
of the rights and obligations of the members and the capital structure of the cooperative
before becoming subject to this chapter. A cooperative organized under chapter 308A or
308B upon distribution of the disclosure required in this subdivision must obtain the approval
of its members as necessary for amending its articles under chapter 308A or 308B.

Sec. 34.

Minnesota Statutes 2024, section 308C.225, subdivision 2, is amended to read:

Subd. 2.

Filings.

(a) A deleted text begin housing deleted text end cooperative organized under chapter 308A or 308B that
is converting to be subject to this chapter must file with the secretary of state and the
applicable county recorder:

(1) a certificate of conversion stating:

(i) the date on which the entity was first organized;

(ii) the name of the chapter 308A or 308B cooperative and, if the name is changed, the
name of the deleted text begin housing deleted text end cooperative to be governed under this chapter; and

(iii) the future effective date and time, which must be a date and time certain, that it will
be governed by this chapter, if the effective date and time is not to be the date and time of
filing; deleted text begin and
deleted text end

(2) a certificate of amendment amending the deleted text begin housing deleted text end cooperative's articles to conform
with the requirements of this chapter deleted text begin . deleted text end new text begin ; and
new text end

new text begin (3) for a cooperative subject to a common interest community declaration that is
converting to be subject to this chapter, a recordable certificate containing a statement that
the membership terminated the common interest community declaration and the date the
member meeting was held signed by the president and secretary and recorded in the county
recorder's office in the county where the cooperative's project is located.
new text end

(b) The conversion is effective new text begin and any common interest community declaration is
terminated new text end upon the filing with the secretary of state and upon the recording of the written
certificate in the county recorder's office.

Sec. 35.

Minnesota Statutes 2024, section 308C.225, subdivision 3, is amended to read:

Subd. 3.

Effect of being governed by this chapter.

The conversion of a deleted text begin housing deleted text end
cooperative organized new text begin and operating new text end under chapter 308A deleted text begin or deleted text end new text begin , new text end 308B new text begin , or 515B new text end to a cooperative
governed by this chapter does not affect any obligations or liabilities of the cooperative
before the conversion or the personal liability of any person incurred before the conversion.
When the conversion is effective, the rights, privileges, and powers of the cooperative; real
and personal property of the cooperative; debts due to the cooperative; and causes of action
belonging to the cooperative remain vested in the cooperative and are the property of the
cooperative as converted and governed by this chapter. Title to real property vested by deed
or otherwise in the deleted text begin housing deleted text end cooperative organized new text begin and operating new text end under chapters 308A deleted text begin and deleted text end new text begin , new text end
308B new text begin , and 515B new text end does not revert and is not impaired by reason of the cooperative being
converted and governed by this chapter. Rights of creditors and liens upon property of the
deleted text begin housing deleted text end cooperative under chapters 308A deleted text begin and deleted text end new text begin , new text end 308B new text begin , and 515B new text end are preserved unimpaired,
and debts, liabilities, and duties of the deleted text begin housing deleted text end cooperative under chapters 308A deleted text begin and deleted text end new text begin , new text end 308B new text begin ,
and 515B new text end remain attached to the deleted text begin housing deleted text end cooperative as converted and governed by this
chapter and may be enforced against the deleted text begin housing deleted text end cooperative to the same extent as if the
debts, liabilities, and duties had originally been incurred or contracted by the cooperative
as organized under this chapter. The rights, privileges, powers, and interests in property of
the cooperative under chapters 308A deleted text begin and deleted text end new text begin , new text end 308B new text begin , and 515B new text end , as well as the debts, liabilities,
and duties of the cooperative are not deemed, as a consequence of the conversion, to have
been transferred for any purpose of the laws of this state.

Sec. 36.

Minnesota Statutes 2024, section 308C.241, subdivision 1, is amended to read:

Subdivision 1.

Required.

A cooperative shall have bylaws deleted text begin governing the cooperative's
business affairs, structure, qualifications, and classification, and the rights and obligations
of members that are not otherwise provided in the articles or by this chapter deleted text end .

Sec. 37.

Minnesota Statutes 2024, section 308C.241, is amended by adding a subdivision
to read:

new text begin Subd. 1a. new text end

new text begin Adoption and amendment. new text end

new text begin (a) Except as provided in paragraph (b), the
bylaws of a cooperative may be adopted or amended by the members at a regular or special
member meeting if:
new text end

new text begin (1) the notice of the regular or special meeting contains a statement that the bylaws will
be voted upon and copies are included with the notice, or copies are available upon request
from the cooperative, and a summary statement of the proposed bylaws or amendment is
included with the notice;
new text end

new text begin (2) a quorum is registered as being present or represented by mail or alternative voting
method if the mail or alternative voting method is authorized by the board; and
new text end

new text begin (3) the bylaws or amendment is approved by a majority of votes cast, or for a cooperative
with articles or bylaws requiring more than majority approval or other conditions for
approval, the bylaws or amendment is approved by a proportion of the vote cast or a number
of the total members that are required by the articles or bylaws and the conditions for
approval in the articles or bylaws are satisfied.
new text end

new text begin (b) The initial bylaws of the cooperative shall be adopted by the cooperative's board of
directors. Until the first annual members meeting following admission of members to the
cooperative, the power to alter, amend, or repeal the bylaws or adopt new bylaws is vested
in the board of directors.
new text end

Sec. 38.

Minnesota Statutes 2024, section 308C.241, subdivision 2, is amended to read:

Subd. 2.

Contents.

deleted text begin (a) If not stated in the articles, the bylaws must state deleted text end new text begin The bylaws
may contain any provision relating to the management or regulation of the affairs of the
cooperative that is not inconsistent with law or the articles. At a minimum, the bylaws must
provide new text end :

(1) the purpose of the cooperative new text begin in accordance with this chapter new text end ;

(2) deleted text begin the capital structure of the cooperative to the extent not stated in the articles, including
a statement of the classes and relative rights, preferences, and restrictions granted to or
imposed upon each class of member interests, and the authority to issue membership interests,
which may be designated to be determined by the board deleted text end new text begin the qualifications for membership
in the cooperative and limitations on the number of memberships issuable new text end ;

(3) deleted text begin a provision designating the voting and governance rights, to the extent not stated in
the articles, including which membership interests have voting power and any limitations
or restrictions on the voting power, which shall be in accordance with the provisions of this
chapter deleted text end new text begin a statement that membership interests in the cooperative are personal property new text end ;

(4) deleted text begin a statement that occupant membership interests with voting power shall be restricted
to one vote for each member in the affairs of the cooperative or a statement describing the
allocation of voting power allocated as prescribed in this chapter deleted text end new text begin the manner of admission,
withdrawal, suspension, and expulsion of members new text end ;

(5) deleted text begin a statement that membership interests held by a member are transferable only with
the approval of the board or as provided in the bylaws deleted text end new text begin generally, the governance rights,
financial rights, assignability of governance and financial rights, and other rights, privileges,
and obligations of members and their membership interests, which may be further described
in member agreements new text end ; deleted text begin and
deleted text end

(6) deleted text begin if nonoccupant membership interests are authorized, a statement as to how profits
and losses will be allocated and cash will be distributed between occupant membership
interests collectively and nonoccupant membership interests collectively to the extent not
stated in the articles, a statement that net income allocated to an occupant membership
interest as determined by the board in excess of dividends and additions to reserves shall
be distributed on the basis of patronage, and a statement that the records of the cooperative
shall include occupant membership interests and, if authorized, nonoccupant membership
interests, which may be further described in the bylaws of any classes and in the reserves. deleted text end new text begin
property, voting, and other rights and privileges of members;
new text end

new text begin (7) the number of members of the board of directors and their respective terms of tenure;
new text end

new text begin (8) the manner of appointment or election of a president, vice-president, treasurer, and
secretary by the board of directors;
new text end

new text begin (9) the qualifications, powers and duties, terms of office, and manner of electing and
removing board members and officers and filling vacancies of the members and officers;
new text end

new text begin (10) the manner of appointment of committees and their authority;
new text end

new text begin (11) the time, place, and manner of calling, conducting, and giving notice of member,
board, and committee meetings, or of conducting mail ballots;
new text end

new text begin (12) the timeframe and manner for issuing reports and financial statements to members;
new text end

new text begin (13) that a meeting of the members must be held at least once each year and a specified
officer must give notice of the meeting as provided in section 308C.511;
new text end

new text begin (14) that an annual report must be prepared by the cooperative and a copy of the report
must be provided to each member at or before the annual meeting containing, at a minimum:
new text end

new text begin (i) a statement of any capital expenditures in excess of two percent of the current budget
or $5,000, whichever is greater, approved by the cooperative for the current fiscal year or
succeeding two fiscal years;
new text end

new text begin (ii) a statement of the cooperative's total replacement reserves, the components of the
cooperative for which the reserves are set aside, and the amounts of the reserves, if any,
that the board has allocated for the replacement of each of those components;
new text end

new text begin (iii) a copy of the statement of revenues and expenses for the cooperative's last fiscal
year and a balance sheet as of the end of that fiscal year;
new text end

new text begin (iv) a statement of the status of any pending litigation or judgments in which the
cooperative is a party;
new text end

new text begin (v) a detailed description of the insurance coverage provided by the cooperative; and
new text end

new text begin (vi) a statement of the total past due assessments on memberships or units current as of
not more than 60 days before the date of the meeting;
new text end

new text begin (15) any material restrictions on the use or occupancy of units, transfers or sale price of
a membership, or the amount that may be received by a member on sale, condemnation, or
casualty loss to the unit appurtenant to the membership;
new text end

deleted text begin (b) The bylaws may contain any provision relating to the management or regulation of
the affairs of the cooperative that are not inconsistent with law or the articles, and may
include the following:
deleted text end

deleted text begin (1) the number of directors and the qualifications, manner of election, powers, duties,
and compensation, if any, of directors;
deleted text end

deleted text begin (2) the qualifications of members and any limitations on their number;
deleted text end

deleted text begin (3) the manner of admission, withdrawal, suspensions, and expulsion of members;
deleted text end

deleted text begin (4) generally, the governance rights, financial rights, assignability of governance and
financial rights, and other rights, privileges, and obligations of members and their
membership interests, which may be further described in member agreements;
deleted text end

deleted text begin (5) deleted text end new text begin (16) new text end if the cooperative intends to deleted text begin operate as a limited equity cooperative, deleted text end new text begin use a transfer
value formula, the circumstances in which the cooperative will use the transfer value formula, new text end
the use and calculation of transfer value, including limits on the extent to which membership
interests may appreciate in value, and the extent, if any, of the cooperative's power to exercise
deleted text begin a right of first refusal or option to acquire deleted text end a member's interest new text begin or assign to a buyer approved
by the cooperative, the cooperative's right to purchase the membership of a deceased or
departing member, new text end and the conditions under which that power is exercised;

deleted text begin (6) deleted text end new text begin (17) new text end the basis for allocating common expenses, charges, outlays, and other
expenditures or payments of the cooperative among deleted text begin dwelling units deleted text end new text begin memberships new text end . Unless
limited in the bylaws, the board of directors may use any approach the board believes to be
fair and that is a reasonable reflection of use or consumption that may be utilized, provided
that the sum of each category of interests allocated at any time to all memberships under
any of the provisions must equal one if stated as a fraction, or 100 percent if stated as a
percentage;

deleted text begin (7) deleted text end new text begin (18) new text end the circumstances under which the board of directors may execute share loan
recognition agreements with lenders that provide members with loans to finance the purchase
of memberships in the cooperative, and the limitations of recognition agreements;

deleted text begin (8) deleted text end new text begin (19) new text end the circumstances under which liens are imposed against membership interests
and occupancy rights, how the liens are foreclosed by the cooperative, the process by which
the cooperative may remove the members and occupants from the deleted text begin dwelling deleted text end units, and the
circumstances and processes under which the cooperative may new text begin levy fines, suspend member
voting rights, and new text end terminate the membership and occupancy rights of its members new text begin and
transfer or dispose of a terminated member's membership new text end ;

deleted text begin (9) deleted text end new text begin (20) new text end a statement that the cooperative will observe the basic cooperative principles
that purchases and sales of memberships and rights under occupancy agreements are not
for speculative purposes, that investments in the cooperative by members are for the purpose
of securing homes for members' use and benefit, and that the policies established by the
cooperative will be designed to discourage and avoid speculation either in the sale and resale
of memberships and rights under occupancy agreements by members or by the cooperative;
and

deleted text begin (10) any provisions required by the articles to be in deleted text end new text begin (21) the method of amending new text end the
bylaws.

deleted text begin (c) Any other provision relating to the management or regulation of the affairs of the
cooperative that are not inconsistent with law or the cooperative's articles.
deleted text end

Sec. 39.

Minnesota Statutes 2024, section 308C.245, is amended to read:

308C.245 COOPERATIVE RECORDS.

new text begin Subdivision 1. new text end

new text begin Required records. new text end

deleted text begin (a) A cooperative shall retain as permanent records
minutes of all meetings of its members and of all board meetings, a record of all actions
taken by the members or the board without a meeting by a written unanimous consent in
lieu of a meeting, and a record of all waivers of notices of meetings of the members and of
the board.
deleted text end

deleted text begin (b) A cooperative shall maintain appropriate account records.
deleted text end

deleted text begin (c) A cooperative shall maintain its records in written form or in another form capable
of conversion into written form within a reasonable time.
deleted text end

deleted text begin (d) A cooperative shall retain a copy of each of the following records at its principal
office:
deleted text end

deleted text begin (1) articles and other governing instruments;
deleted text end

deleted text begin (2) bylaws or other similar instruments;
deleted text end

deleted text begin (3) a record of the names and addresses of its members, in a form that allows preparation
of an alphabetical list of members with each member's address;
deleted text end

deleted text begin (4) minutes of member meetings, and records of all actions taken by members without
a meeting by unanimous written consent in lieu of a meeting, for the prior three years;
deleted text end

deleted text begin (5) all written communications within the prior three years to members as a group;
deleted text end

deleted text begin (6) a list of the names and business addresses of its current board members and officers;
deleted text end

deleted text begin (7) a copy of its most recent periodic registration delivered to the secretary of state under
section 308C.121; and
deleted text end

deleted text begin (8) all financial statements prepared for periods ending during the last fiscal year.
deleted text end

new text begin The cooperative must keep adequate records of the cooperative's membership, members
meetings, board of directors meetings, committee meetings, contracts, proprietary leases,
and other agreements in which the cooperative is a party and material correspondence and
memoranda relating to the cooperative's operations. The cooperative must keep financial
records sufficiently detailed to enable the cooperative to comply with sections 308C.241,
subdivision 2, and 308C.612, subdivision 3.
new text end

new text begin Subd. 2. new text end

new text begin Examination of records. new text end

new text begin All records, except records relating to information
that was the basis for closing a board meeting under section 308C.425, subdivision 2, clause
(2), must be made reasonably available for examination by any member or the member's
authorized agent. The cooperative must provide copies in paper or electronic form as
requested by the member or the member's authorized agent, provided that the cooperative
is not required to provide copies in electronic form if the records are not maintained in that
form by the cooperative.
new text end

new text begin Subd. 3. new text end

new text begin Fees. new text end

new text begin The cooperative may require the member or the member's authorized
agent to pay a fee for copies that must not exceed:
new text end

new text begin (1) the actual costs of making or electronically transmitting the copies and searching for
and retrieving the requested records, including the cost of agent or employee time for
responding to the request; or
new text end

new text begin (2) if 100 or fewer pages of black and white, letter or legal size paper copies are requested,
no more than 25 cents for each page copied.
new text end

new text begin Subd. 4. new text end

new text begin Discretion; retention; disclosure. new text end

deleted text begin (e) deleted text end Except as otherwise limited by this
chapter, the board of a cooperative shall have discretion to determine what records are
appropriate for the purposes of the cooperative, the length of time records are to be retained,
and policies relating to the confidentiality, disclosure, inspection, and copying of the records
of the cooperative.

Sec. 40.

Minnesota Statutes 2024, section 308C.301, subdivision 1, is amended to read:

Subdivision 1.

deleted text begin Generally deleted text end new text begin Powers of the cooperative new text end .

In addition to other powers, a
cooperative as an agent or otherwise:

(1) may perform every act necessary or proper to the conduct of the cooperative's business
or the accomplishment of the purposes of the cooperative deleted text begin ; deleted text end new text begin , including but not limited to the
power to:
new text end

new text begin (i) sue and be sued in the cooperative's corporate name;
new text end

new text begin (ii) build and construct units;
new text end

new text begin (iii) purchase; take; receive; lease as lessee; take by gift, devise, or bequest; or otherwise
acquire and to own, hold, use, and otherwise deal in and with any real or personal property
or any interest therein;
new text end

new text begin (iv) sell, convey, mortgage, pledge, lease as lessor, and otherwise dispose of all or any
part of the cooperative's property and assets;
new text end

new text begin (v) make contracts and incur liabilities that may be appropriate to accomplish the
cooperative's purposes; borrow money at rates of interest determined by the cooperative;
issue notes, bonds, and other obligations; and secure obligations by mortgage, pledge, or
deed of trust for the cooperative's property;
new text end

new text begin (vi) elect or appoint officers and agents of the cooperative and define the duties and fix
the compensation of the officers and agents;
new text end

new text begin (vii) make and alter bylaws not inconsistent with the cooperative's articles or with the
laws of this state for the administration and regulation of the affairs of the cooperative;
new text end

new text begin (viii) dissolve and cease cooperative activities as provided in this chapter; and
new text end

new text begin (ix) have and exercise all powers necessary or convenient to effect the purposes for
which the cooperative is organized;
new text end

(2) has other rights, powers, or privileges granted by the laws of this state to other
cooperatives, except those that are inconsistent with the express provisions of this chapter;
and

(3) has the powers given in section 308C.201 and this section.

Sec. 41.

Minnesota Statutes 2024, section 308C.301, subdivision 2, is amended to read:

Subd. 2.

deleted text begin Legal capacity deleted text end new text begin Powers of the board new text end .

deleted text begin A cooperative may sue and be sued,
complain and defend and participate as a party or otherwise in any legal, administrative, or
arbitration proceeding, in its corporate name. deleted text end new text begin Subject to the provisions of the articles or
bylaws, the cooperative, through its board, has all the powers and duties necessary for the
administration of the affairs of the cooperative and may take action except as required by
law or to be done by the members in the bylaws, including but not limited to:
new text end

new text begin (1) adopt, amend, and revoke rules and regulations not inconsistent with the articles and
bylaws;
new text end

new text begin (2) adopt and amend budgets for revenues, expenditures, reserves, and maintenance and
levy and collect assessments from members;
new text end

new text begin (3) hire and discharge management agents and employees, agents, and independent
contractors;
new text end

new text begin (4) institute, defend, or intervene in litigation or administrative proceedings on behalf
of the cooperative or the cooperative's members on matters affecting the cooperative or the
cooperative's project;
new text end

new text begin (5) make contracts and incur liabilities;
new text end

new text begin (6) regulate the use, maintenance, repair, replacement, and modification to the common
elements and the units;
new text end

new text begin (7) cause improvements to be made to the common elements and the units;
new text end

new text begin (8) acquire, hold, encumber, and convey in the cooperative's name, any right, title, or
interest to the personal property of the cooperative;
new text end

new text begin (9) after securing the affirmative vote of the membership under this chapter, acquire,
hold, encumber, and convey in the cooperative's name, any right, title, or interest to the real
estate of the cooperative;
new text end

new text begin (10) grant easements for public utilities, public rights-of-way or other public purposes,
and cable television or other communications through, over, or under the project;
new text end

new text begin (11) impose charges, fines, or other sanctions, including the loss of voting rights, for
late payment of assessments and, after notice and opportunity to be heard, levy reasonable
fines or terminate the member's membership interest and appurtenant right of occupancy
for violations of the articles, bylaws, proprietary lease, rules, or policies of the cooperative;
new text end

new text begin (12) impose reasonable charges for the review and preparation of documents requested
by members, statements of unpaid assessments, or furnishing copies of cooperative records;
new text end

new text begin (13) provide for the indemnification of the cooperative's officers and directors and
maintain directors' and officers' liability insurance;
new text end

new text begin (14) provide for reasonable procedure for governing the conduct of meetings and election
of directors;
new text end

new text begin (15) exercise powers in relations with members, cooperatives, or business entities from
which the cooperative is constituted; and
new text end

new text begin (16) exercise all other powers necessary or convenient to effect the purposes for which
cooperatives are formed under this chapter.
new text end

Sec. 42.

Minnesota Statutes 2024, section 308C.311, is amended to read:

308C.311 deleted text begin OCCUPANCY AGREEMENTS AND deleted text end PROPRIETARY LEASES.

Subdivision 1.

Authority.

A cooperative and its deleted text begin occupant deleted text end members may make and
execute deleted text begin an occupancy agreement, deleted text end new text begin a new text end proprietary lease deleted text begin , deleted text end or other agreements that specify the
terms of the deleted text begin occupant deleted text end members' lease or occupancy of a unit deleted text begin or dwelling unit deleted text end .

Subd. 2.

Title to unit deleted text begin or dwelling unit deleted text end .

Title to cooperative property consisting of a
deleted text begin dwelling deleted text end unit deleted text begin or units deleted text end shall at all times remain the property of the cooperative. Title to any
manufactured home owned by a member placed in a manufactured home park owned by a
cooperative pursuant to a proprietary lease remains in the name of the member.

Subd. 3.

Damages for breach of contract.

The bylaws deleted text begin , an occupancy agreement, deleted text end or new text begin a
new text end proprietary lease may include the requirement of the member to pay liquidated damages to
the cooperative for breach of any provision of deleted text begin an occupancy agreement, deleted text end new text begin a new text end proprietary lease deleted text begin , deleted text end
or other agreement. The remedies for breach of contract are valid and enforceable in the
courts of this state.

Sec. 43.

Minnesota Statutes 2024, section 308C.312, is amended to read:

308C.312 LIMITED EQUITY new text begin APPRECIATION new text end COOPERATIVES.

A cooperative formed under this chapter may organize as a limited equity new text begin appreciation
new text end cooperative in order to fulfill the public purpose of providing and preserving housing for
persons and households of low and moderate income at the time that they purchase their
memberships. In addition to safeguarding the foregoing public purpose, a limited equity
new text begin appreciation new text end cooperative shall meet the following requirements:

(1) the articles new text begin or bylaws new text end shall require that cooperative interests be sold at no more than
a transfer value determined by a limited equity formula contained in the articles new text begin or bylaws new text end .
That value shall be consistent with the object of maintaining long-term affordability of
membership interests for persons or households of low and moderate income;

(2) a limited equity formula, once established by a cooperative in its articles new text begin or bylaws new text end ,
may be amended only if that amendment does not make the cooperative membership
unaffordable for low or moderate income households for which the cooperative was originally
incorporated. A limited equity new text begin appreciation new text end cooperative once organized under this chapter
may not reorganize as other than a limited equity new text begin appreciation new text end cooperative without first
dissolving;

(3) a limited equity new text begin appreciation new text end cooperative shall not sell all or substantially all of its
assets if such sale is intended to circumvent the public purposes of this section;

(4) the articles new text begin or bylaws new text end shall require that the cooperative shall have deleted text begin the first right to
repurchase a member's cooperative interest deleted text end new text begin an option or first privilege to purchase the
membership or assign to a buyer approved by the cooperative, the cooperative's right to
purchase the membership of a deceased or departing member new text end ;

(5) the articles new text begin or bylaws new text end shall require that the total distribution out of capital to a member
shall not exceed the transfer value; and

(6) the articles new text begin or bylaws new text end shall require that upon dissolution of the cooperative, any assets
remaining after retirement of corporate debts and distribution to members shall be distributed
to a charitable organization described in section 501(c)(3) of the Internal Revenue Code of
1986, as amended, a public agency, or another limited equity new text begin appreciation new text end cooperative whose
formula for determining transfer value shall be no less restrictive than that of the cooperative
being dissolved.

Sec. 44.

new text begin [308C.313] MARKET RATE COOPERATIVES.
new text end

new text begin A cooperative formed under this chapter may organize as a market rate cooperative. A
market rate cooperative must meet the following requirements:
new text end

new text begin (1) the articles or bylaws must contain a reference as to whether the cooperative will
impose limitations on the valuation or sales price of a membership for sale or transfer
purposes;
new text end

new text begin (2) if limitations on the valuation or sales price of a membership for sale or transfer
purposes will be imposed, the articles or bylaws must:
new text end

new text begin (i) set forth a transfer value formula which defines the limits on appreciation, value, and
price of a membership for sales or transfer purposes; and
new text end

new text begin (ii) set forth whether the transfer value formula will govern all membership sales and,
if less than all membership sales, the circumstances or conditions under which a membership
sales price may be other than the membership's transfer value;
new text end

new text begin (3) the articles or bylaws may provide for an option or first privilege in favor of the
cooperative to purchase the membership or assign to a buyer approved by the cooperative
the cooperative's right to purchase the membership of a deceased or departing member; and
new text end

new text begin (4) the articles or bylaws shall require that upon dissolution of the cooperative, any assets
remaining after retirement of corporate debts shall be distributed to the members.
new text end

Sec. 45.

Minnesota Statutes 2024, section 308C.401, is amended to read:

308C.401 BOARD GOVERNS COOPERATIVE.

new text begin Subdivision 1. new text end

new text begin Board powers; generally. new text end

A cooperative shall be governed by its board,
which shall take all action for and on behalf of the cooperative, except those actions reserved
or granted to members new text begin in the cooperative's articles or bylaws, under subdivision 2, or under
other provisions of this chapter new text end . Board action shall be by the affirmative vote of a majority
of the directors voting at a duly called meeting unless a greater majority is required by the
articles or bylaws. A director individually or collectively with other directors does not have
authority to act for or on behalf of the cooperative unless authorized by the board. A director
may advocate interests of members or member groups to the board, but the duty of each
director is to represent the best interests of the cooperative and all members collectively.

new text begin Subd. 2. new text end

new text begin Exceptions to board powers. new text end

new text begin The board must not, without vote or agreement
of the members:
new text end

new text begin (1) amend the cooperative's articles or, except as set forth in section 308C.241,
subdivision 7, the cooperative's bylaws;
new text end

new text begin (2) terminate or dissolve the cooperative;
new text end

new text begin (3) convey or encumber the cooperative or the cooperative's project or subject the
cooperative or its project to a security interest, after the first annual members meeting
following admission of members to the cooperative;
new text end

new text begin (4) elect members of the board, but the board may fill vacancies in the board's
membership created other than by removal by the vote of the cooperative's members for
the unexpired portion of any term; or
new text end

new text begin (5) determine the qualifications, powers, duties, or terms of office of directors.
new text end

Sec. 46.

Minnesota Statutes 2024, section 308C.405, is amended to read:

308C.405 NUMBER OF DIRECTORS.

A board of directors must consist of three or more individuals, with the number specified
in or fixed in accordance with the articles or bylaws. new text begin Except for the first board and filling
vacancies pursuant to section 308C.415, new text end the power to elect or appoint directors is vested in
the members. If the number of directors is fewer than three, or such greater minimum number
set forth in the articles or bylaws, a majority of the directors in office may appoint or elect
the number of additional directors necessary to increase the board to three directors or such
greater minimum set forth in the articles or bylaws.

Sec. 47.

Minnesota Statutes 2024, section 308C.411, subdivision 1, is amended to read:

Subdivision 1.

First board.

Unless appointed by a developer, the deleted text begin organizer or organizers deleted text end new text begin
incorporator or incorporators new text end shall elect and obtain the acknowledgment of the first board
to serve until directors are elected by members. Until election by members, the first board
shall appoint directors to fill any vacancies. The first board may be named in the articles.

Sec. 48.

Minnesota Statutes 2025 Supplement, section 308C.411, subdivision 2, is amended
to read:

Subd. 2.

Generally.

(a) Directors shall be elected for the term, at the time, and in the
manner provided in this section and the bylaws.

(b) Except for the first board, all of the directors shall be members and shall be elected
exclusively by the members deleted text begin holding occupant membership interests deleted text end .

deleted text begin (c) The voting authority of the directors may be allocated according to equity
classifications of the cooperative provided that at least two-thirds of the voting power on
general matters of the cooperative shall be allocated to the directors who are members
holding occupant membership interests.
deleted text end

deleted text begin (d) deleted text end new text begin (c) new text end A director holds office for the term the director was elected and until a successor
is elected and has qualified, or until the earlier death, resignation, removal, or disqualification
of the director.

deleted text begin (e) deleted text end new text begin (d) new text end The expiration of a director's term with or without election of a qualified successor
does not make the prior or subsequent acts of the director or the board void or voidable.

deleted text begin (f) deleted text end new text begin (e) new text end Subject to any limitation in the articles or bylaws, directors shall not be
compensated, but may be reimbursed reasonable and necessary expenses incurred when
they are acting on behalf of the board of directors.

deleted text begin (g) Directors may be divided into or designated and elected by class or other distinction
as provided in the articles or bylaws.
deleted text end

deleted text begin (h) deleted text end new text begin (f) new text end A director may resign by giving written notice to the chair of the board or the
board. The resignation is effective without acceptance when the notice is given to the chair
of the board or the board unless a later effective time is specified in the notice.

Sec. 49.

Minnesota Statutes 2024, section 308C.415, subdivision 1, is amended to read:

Subdivision 1.

deleted text begin Occupant directors deleted text end new text begin Vacancy new text end .

If deleted text begin an occupant member deleted text end new text begin a new text end director's position
becomes vacant deleted text begin or a new director position is created for a director that was or is to be elected
by occupant members, the board, in consultation with the directors elected by occupant
members deleted text end , new text begin the directors new text end shall appoint deleted text begin an occupant deleted text end new text begin a new text end member deleted text begin of the cooperative deleted text end to fill the
director's position until the next regular or special members' meeting. deleted text begin If there are no directors
elected by occupant members on the board at the time of the vacancy, a special members'
meeting shall be called to fill the occupant member director vacancy. deleted text end new text begin At the next regular
or special meeting, the members must elect a director to fill the unexpired term of the vacant
director's position.
new text end

Sec. 50.

Minnesota Statutes 2024, section 308C.421, subdivision 3, is amended to read:

Subd. 3.

Removal by members.

Any one or all of the directors may be removed at any
time, with or without cause, by the affirmative vote of the holders of a majority of the entire
membership of record at any duly called annual meeting, or at any special meeting called
for the purpose of removing or electing directors deleted text begin ; provided that if a director has been elected
solely by the occupant members or the holders of a class or series of membership interests
as stated in the articles or bylaws, then that director may be removed only by the affirmative
vote of the holders of a majority of the voting power of the occupant members for a director
elected by the occupant members or of all membership interests of that class or series entitled
to vote at an election of that director deleted text end .

Sec. 51.

Minnesota Statutes 2024, section 308C.425, subdivision 2, is amended to read:

Subd. 2.

Open meetings.

new text begin (a) new text end Meetings of the board must be open to all members, subject
to the following requirements:

(1) to the extent practicable, the board shall give reasonable notice to the members of
the date, time, and place of each open board meeting. If the date, time, and place of meetings
are provided for in the bylaws, announced at a previous meeting of the board, posted in a
location accessible to the members and designated by the board from time to time, or if an
emergency requires immediate consideration of a matter by the board, notice is not required;

(2) meetings may be closed deleted text begin to discuss deleted text end new text begin for new text end the following new text begin purposes new text end :

(i) new text begin to discuss new text end personnel matters;

(ii) new text begin to discuss new text end pending or potential litigation, arbitration, or other potentially adversarial
proceedings between members or between the board or cooperative and members, or other
matters in which any member may have an adversarial interest if the board determines that
closing the meeting is necessary to discuss strategy or to otherwise protect the position of
the board or cooperative or the privacy of a member;

(iii) new text begin to discuss new text end criminal activity arising within the cooperative if the board determines
that closing the meeting is necessary to protect the privacy of the victim or that opening the
meeting would jeopardize investigation of the activity;

(iv) deleted text begin meetings deleted text end new text begin to meet new text end with deleted text begin legal counsel deleted text end new text begin the cooperative's attorney new text end for counsel and advice
on any matter of concern to the board; deleted text begin and
deleted text end

(v) new text begin to new text end review deleted text begin of deleted text end financial and other lawful information required by the board of directors
of all applicants for membership in the cooperative; deleted text begin and
deleted text end

new text begin (vi) to discuss contracts, leases, and other commercial transactions to purchase or provide
goods or services currently being negotiated, including the review of bids or proposals, if
premature general knowledge of those matters would place the cooperative at a disadvantage;
and
new text end

new text begin (vii) to prevent public knowledge of the matter to be discussed if the board determines
that public knowledge would violate the privacy of any person; and
new text end

(3) the minutes of any part of a meeting that is closed under this section may be kept
confidential at the discretion of the board.

new text begin (b) For purposes of this subdivision, a gathering of members of the board at which the
board members do not conduct cooperative business is not a meeting of the board. Board
members may not use incidental or social gatherings to evade the open meeting requirements
of this subdivision.
new text end

Sec. 52.

Minnesota Statutes 2024, section 308C.441, subdivision 1, is amended to read:

Subdivision 1.

Method.

An action required or permitted to be taken at a board meeting
may be taken by written action signed by all of the directors. If the articles or bylaws so
provide, any action, other than an action requiring member approval, may be taken by
written action signed by the number of directors that would be required to take the same
action at a meeting of the board at which all directors were present. deleted text begin If the board takes an
action without a meeting, the written action must be signed by all of the members of the
board, must state why the action was taken without a meeting, and must be placed in the
corporate records of the cooperative.
deleted text end

Sec. 53.

Minnesota Statutes 2024, section 308C.451, subdivision 1, is amended to read:

Subdivision 1.

Generally.

deleted text begin If the bylaws so provide, the board may establish committees. deleted text end
A resolution approved by the affirmative vote of a majority of the board may establish
committees having the authority of the board in the management of the business of the
cooperative only to the extent provided in the resolution. deleted text begin Committees may include a special
litigation committee consisting of one or more independent directors or other independent
persons to consider legal rights or remedies of the cooperative and whether those rights and
remedies should be pursued. Committees other than special litigation committees are subject
at all times to the direction and control of the board. deleted text end new text begin Committees authorized to exercise any
power reserved to the board must include at least three board members who have exclusive
voting power for that committee. Committees that are not so composed may not exercise
the authority of the board and are advisory only.
new text end

Sec. 54.

Minnesota Statutes 2024, section 308C.451, subdivision 2, is amended to read:

Subd. 2.

Membership.

Committee members must be deleted text begin natural persons deleted text end new text begin members of the
cooperative new text end . Unless the articles or bylaws provide for a different deleted text begin membership or deleted text end manner of
appointment, a committee consists of one or more persons deleted text begin , who need not be directors or
members, deleted text end appointed by affirmative vote of a majority of the directors present.

Sec. 55.

Minnesota Statutes 2024, section 308C.471, subdivision 4, is amended to read:

Subd. 4.

Prohibition or limit on indemnification or advances.

The articles or bylaws
either may prohibit indemnification or advances of expenses otherwise required by this
section or may impose conditions on indemnification or advances of expenses in addition
to the conditions contained in subdivisions 2 and 3, including, without limitation, monetary
limits on indemnification or advances of expenses if the conditions apply equally to all
persons or to all persons deleted text begin within a given class deleted text end . A prohibition or limit on indemnification or
advances of expenses may not apply to or affect the right of a person to indemnification or
advances of expenses with respect to any acts or omissions of the person occurring before
the effective date of a provision in the articles or the date of adoption of a provision in the
bylaws establishing the prohibition or limit on indemnification or advances of expenses.

Sec. 56.

Minnesota Statutes 2024, section 308C.471, subdivision 6, is amended to read:

Subd. 6.

Determination of eligibility.

(a) All determinations whether indemnification
of a person is required because the criteria set forth in subdivision 2 have been satisfied and
whether a person is entitled to payment or reimbursement of expenses in advance of the
final disposition of a proceeding as provided in subdivision 3 must be made:

(1) by the board by a majority of a quorum, if the directors who are, at the time, parties
to the proceeding are not counted for determining either a majority or the presence of a
quorum;

(2) if a quorum under clause (1) cannot be obtained by a majority of a committee of the
board consisting solely of two or more directors not at the time parties to the proceeding
duly designated to act in the matter by a majority of the full board, including directors who
are parties;

(3) if a determination is not made under clause (1) or (2) by special legal counsel selected
either by a majority of the board or a committee by vote under clause (1) or (2) or if the
requisite quorum of the full board cannot be obtained and the committee cannot be established
by a majority of the full board, including directors who are parties;

(4) if a determination is not made under clauses (1) to (3) by the affirmative vote of the
members, but the membership interests held by parties to the proceeding must not be counted
in determining the presence of a quorum, and are not considered to be present and entitled
to vote on the determination; or

(5) if an adverse determination is made under clauses (1) to (4) or paragraph (b), or if
no determination is made under clauses (1) to (4) or paragraph (b) within 60 days after (i)
the later to occur of the termination of a proceeding or a written request for indemnification
to the cooperative, or (ii) a written request for an advance of expenses, as the case may be,
by a court in this state, which may be the same court in which the proceeding involving the
person's liability took place upon application of the person and any notice the court requires.
The person seeking indemnification or payment or reimbursement of expenses under this
clause has the burden of establishing that the person is entitled to indemnification or payment
or reimbursement of expenses.

(b) With respect to a person who is not, and was not at the time of the acts or omissions
complained of in the proceedings; a director, general manager, or person possessing, directly
or indirectly, the power to direct or cause the direction of the management or policies of
the cooperative; the determination whether indemnification of this person is required because
the criteria set forth in subdivision 2 have been satisfied; and whether this person is entitled
to payment or reimbursement of expenses in advance of the final disposition of a proceeding
as provided in subdivision 3 may be made by an annually appointed committee of the board,
having at least deleted text begin one member deleted text end new text begin two members new text end who deleted text begin is a director deleted text end new text begin are directors new text end . The committee
shall report at least annually to the board concerning its actions.

Sec. 57.

Minnesota Statutes 2024, section 308C.475, subdivision 1, is amended to read:

Subdivision 1.

Required officers.

(a) The board shall elect:

(1) a president deleted text begin or chief executive officer deleted text end ;

(2) one or more vice presidents;

(3) a secretary; and

(4) a treasurer deleted text begin or chief financial officer deleted text end .

(b) The officers, other than the president deleted text begin or a general manager deleted text end , shall not have the authority
to bind the cooperative except as authorized by the board.

Sec. 58.

Minnesota Statutes 2024, section 308C.475, subdivision 5, is amended to read:

Subd. 5.

Election of officers.

Officers deleted text begin of the cooperative deleted text end shall be elected at such intervals
as the articles or bylaws authorize or require and will hold office at the pleasure of the board.

Sec. 59.

Minnesota Statutes 2024, section 308C.501, subdivision 1, is amended to read:

Subdivision 1.

Requirement.

A cooperative deleted text begin shall have one or more members deleted text end new text begin under this
chapter shall be organized on a membership basis without capital stock new text end .

Sec. 60.

Minnesota Statutes 2024, section 308C.501, subdivision 2, is amended to read:

Subd. 2.

deleted text begin Classes deleted text end new text begin One class new text end of members.

A cooperative deleted text begin may deleted text end new text begin must new text end have new text begin only new text end one class
of members, all of whom deleted text begin are occupant members or a cooperative may have more than one
class of members as long as one class of members are occupant members deleted text end new text begin shall occupy a
unit in the cooperative's project. The designation of that class and the rights of the members
shall be set forth in the articles of incorporation or the bylaws new text end .

Sec. 61.

Minnesota Statutes 2024, section 308C.501, is amended by adding a subdivision
to read:

new text begin Subd. 2a. new text end

new text begin Membership transfer rights. new text end

new text begin No member may transfer the member's
membership except as permitted in the articles or the bylaws.
new text end

Sec. 62.

new text begin [308C.503] MEMBER VIOLATIONS; COOPERATIVE REMEDIES.
new text end

new text begin Subdivision 1. new text end

new text begin Good cause required. new text end

new text begin The bylaws may provide for the levying of
reasonable fines against the member and member's membership, the suspension of voting
rights, or other remedial actions, including termination of the member's membership and
appurtenant right of occupancy if good cause is required. Good cause includes nonpayment
of loans, fees, costs, or assessments pertaining to the membership interest, or a material
violation of the articles, bylaws, proprietary lease, or the rules, regulations, or policies of
the cooperative that continues following reasonable notice and reasonable opportunity to
cure the alleged material violations.
new text end

new text begin Subd. 2. new text end

new text begin Notice to member. new text end

new text begin (a) Before a cooperative levies a fine or terminates the
membership and appurtenant occupancy right of a member for good cause, the cooperative
must issue a dated, written notice to the member that:
new text end

new text begin (1) in the case of a fine, states:
new text end

new text begin (i) the amount and reason for the fine;
new text end

new text begin (ii) the section of the articles, bylaws, proprietary lease, or rules, regulations, or policies
of the cooperative allegedly violated;
new text end

new text begin (iii) the date of the proposed levy;
new text end

new text begin (iv) any remaining period of time, if any, that the member may use to cure the alleged
violation and avoid the imposition of a fine and a description of the specific actions the
member must undertake to cure the violation; and
new text end

new text begin (v) that all unpaid fines are liens which, if not satisfied, could result in an increased fine,
imposition of attorney fees and other collection costs, foreclosure of the lien against the
member's membership, or termination of the member's membership and the member's
appurtenant right of occupancy;
new text end

new text begin (2) in the case of a termination of the member's membership and appurtenant right of
occupancy, states:
new text end

new text begin (i) the section of the articles, bylaws, proprietary lease, or rules, regulations, or policies
of the cooperative allegedly violated;
new text end

new text begin (ii) the reason for termination;
new text end

new text begin (iii) any remaining period of time, if any, that the member may use to cure the alleged
violation and avoid termination and a description of the specific actions the member must
undertake to cure the violation;
new text end

new text begin (iv) the intended manner and anticipated timing for transfer and disposition of the
membership upon its termination; and
new text end

new text begin (v) that upon termination of the member's appurtenant right of occupancy, the member
may be evicted; and
new text end

new text begin (3) provides the member with the opportunity to request a hearing before the board on
the issue and that provides the member with:
new text end

new text begin (i) the method the member must use to request the hearing;
new text end

new text begin (ii) any deadlines associated with the hearing process;
new text end

new text begin (iii) a statement that the member may submit a written communication or memorandum
to the board in lieu of a hearing and any deadlines for submitting the written communication;
and
new text end

new text begin (iv) the date the board will issue its determination to proceed with levying the proposed
fine or proceed with membership interest and occupancy right termination in the absence
of the member's timely request for a hearing or written submission.
new text end

new text begin (b) In addition to the member, the notice required under this subdivision must be sent
to any other person who has a recorded interest in the member's membership interest that
would be extinguished by the cooperative's termination and transfer of the membership
interest. The notice required under this subdivision may be sent to any address reasonable
under the circumstances.
new text end

new text begin Subd. 3. new text end

new text begin Loss of voting rights. new text end

new text begin A cooperative may suspend the voting rights of a member
due to nonpayment of a monetary obligation owed to the cooperative that is more than 60
days delinquent. A voting interest or consent right allocated to a membership which has
been suspended by the cooperative may not be counted toward the total number of voting
memberships for any purpose, including but not limited to the number of voting interests
necessary to constitute a quorum, the number of voting interests required to conduct an
election, or the number of voting interests required to approve an action under this chapter
or pursuant to the cooperative's governing documents, articles, or bylaws. The suspension
shall end upon full payment of all obligations currently due or overdue to the cooperative.
The notice and hearing requirements under subdivision 2 do not apply to a voting right
suspension under this section.
new text end

new text begin Subd. 4. new text end

new text begin Transfer of membership posttermination. new text end

new text begin In addition to the cooperative's
authority to accept a deed in lieu of foreclosure or to foreclose its lien against the membership
for a default in the member's obligation to pay assessments and dispose of the membership
as provided in section 308C.615, a membership terminated for good cause may be transferred
as provided in the bylaws, including through:
new text end

new text begin (1) the purchase of the membership for its book or transfer value by the cooperative or
a buyer to whom the cooperative assigns a purchase option reserved to the cooperative in
the bylaws; or
new text end

new text begin (2) the sale of the membership by the cooperative at a private sale for a price determined
between the cooperative and purchaser. The sale price need not be the membership's transfer
or book value, but every aspect of the sale, including the method, advertising, time, place,
sales price, and terms, must be reasonable.
new text end

Sec. 63.

Minnesota Statutes 2024, section 308C.505, is amended to read:

308C.505 MEMBER NOT LIABLE FOR COOPERATIVE DEBTS.

A member is not, merely on the account of that status, personally liable for the acts,
debts, liabilities, or obligations of a cooperative. A member is liable for any unpaid
subscription for the membership interest, unpaid membership fees or carrying deleted text begin charges deleted text end new text begin
assessments new text end , or a debt for which the member has separately contracted with the cooperative.

Sec. 64.

Minnesota Statutes 2024, section 308C.511, subdivision 1, is amended to read:

Subdivision 1.

Annual meeting.

Regular member meetings shall be held annually at a
time determined by the board, unless deleted text begin more frequent meetings are deleted text end new text begin otherwise new text end provided for in
the bylaws.

Sec. 65.

Minnesota Statutes 2024, section 308C.511, subdivision 3, is amended to read:

Subd. 3.

Business and fiscal reports.

Unless additional information is required by the
bylaws, the officers shall submit reports to the members at the regular member meetings
covering the business of the cooperative for the previous fiscal year that show the financial
condition of the cooperative at the close of the fiscal year. new text begin The report must contain, at a
minimum, the following:
new text end

new text begin (1) a statement of any capital expenditure in excess of two percent of the current budget
or $5,000, whichever is greater, approved by the cooperative for the current fiscal year or
succeeding two fiscal years;
new text end

new text begin (2) a statement of the balance of any reserve or replacement fund or any portion of the
fund designated for any specific project by the board of directors;
new text end

new text begin (3) a copy of the statement of revenues and expenses for the cooperative's last fiscal
year and a balance sheet as of the end of the fiscal year;
new text end

new text begin (4) the status of any pending litigation or judgments naming the cooperative as a party;
new text end

new text begin (5) a detailed description of the insurance coverage provided by the cooperative; and
new text end

new text begin (6) a statement of the total past due assessments on all memberships and units, current
as of not more than 60 days before the date of the annual meeting.
new text end

Sec. 66.

Minnesota Statutes 2024, section 308C.525, subdivision 1, is amended to read:

Subdivision 1.

Quorum.

deleted text begin At any annual or special meeting of the members, unless other
increased by the deleted text end new text begin Unless provided otherwise in the articles or new text end bylaws, a quorum necessary
for the transaction of business new text begin at any annual or special meeting of the members new text end shall be deleted text begin ten deleted text end new text begin
20 new text end percent of the total number of deleted text begin members deleted text end new text begin memberships and the subsequent departure of
members from the meeting at which a quorum was initially established shall not destroy a
quorum new text end .

Sec. 67.

Minnesota Statutes 2024, section 308C.531, subdivision 2, is amended to read:

Subd. 2.

Member meetings held solely by means of remote communication.

To the
extent authorized in the articles or the bylaws and determined by the board, a regular or
special meeting of members may be held solely by any combination of means of remote
communication through which the members may participate in the meeting, if notice of the
meeting is given to every owner of new text begin a new text end membership deleted text begin interests deleted text end new text begin interest new text end entitled to vote as would
be required by this chapter for a meeting, and if the membership interests held by the
members participating in the meeting would be sufficient to constitute a quorum at a meeting.
Participation by a member by that means constitutes presence at the meeting in person if
all the other requirements of this chapter for the meeting are met.

Sec. 68.

Minnesota Statutes 2024, section 308C.531, subdivision 6, is amended to read:

Subd. 6.

Revocation.

Any ballot, vote, authorization, or consent submitted by electronic
communication under this chapter may be revoked by the member submitting the ballot,
vote, authorization, or consent so long as the revocation is received by a director or the deleted text begin chief
executive officer deleted text end new text begin president new text end of the cooperative at or before the meeting or before an action
without a meeting is effective.

Sec. 69.

Minnesota Statutes 2024, section 308C.535, subdivision 1, is amended to read:

Subdivision 1.

Action of affirmative vote of members.

deleted text begin (a) deleted text end new text begin Unless otherwise provided
by this chapter, new text end the members shall take action by the affirmative vote of a majority of the
membership interests present and entitled to vote on that item of business new text begin , except as provided
under subdivision 2 new text end .

deleted text begin (b) If the articles or bylaws require a larger proportion than is required by this chapter
for a particular action, the articles or bylaws shall have control over the provisions of this
chapter.
deleted text end

Sec. 70.

Minnesota Statutes 2024, section 308C.535, subdivision 2, is amended to read:

Subd. 2.

Greater quorum or voting requirements.

(a) The articles or bylaws adopted
by the members may provide for a greater quorum or voting requirement for members deleted text begin or
voting groups deleted text end than is provided for by this chapter.

(b) An amendment to the articles or bylaws that adds, changes, or deletes a greater
quorum or voting requirement shall meet the same quorum requirement and be adopted by
the same vote deleted text begin and voting groups deleted text end required to take action under the quorum and voting
requirements then in effect or proposed to be adopted deleted text begin , whichever is greater deleted text end .

Sec. 71.

Minnesota Statutes 2024, section 308C.541, subdivision 1, is amended to read:

Subdivision 1.

Method.

An action required or permitted to be taken at a meeting of the
members may be taken by written action signed or consented to by authenticated electronic
communication, by a majority of the entire membership of record or such other percentage
of membership as is defined in the cooperative's articles deleted text begin of incorporation deleted text end or bylaws, that
would be required to take the same action at a meeting of the members at which all members
deleted text begin were deleted text end new text begin are new text end present.

Sec. 72.

Minnesota Statutes 2025 Supplement, section 308C.545, subdivision 1, is amended
to read:

Subdivision 1.

Generally.

One membership shall be issued by the cooperative for each
deleted text begin dwelling deleted text end unit deleted text begin or lot deleted text end in the project such that the resulting number of memberships outstanding
at all times is equal to the number of deleted text begin dwelling deleted text end units deleted text begin or lots deleted text end in the project. Each membership
shall have one vote in the affairs of the cooperative. deleted text begin If the cooperative has both occupant
and nonoccupant members, on any matter of the cooperative, the entire occupant members
voting power shall be voted collectively based upon the vote of the majority of occupant
members voting on the issue and the collective vote of the nonoccupant members shall be
a majority of the vote cast unless otherwise provided in the bylaws. The bylaws may not
reduce the collective occupant member vote to less than 15 percent of the total vote on
matters of the cooperative. A nonoccupant member has the voting rights in accordance with
nonoccupant membership interests as granted in the bylaws, subject to the provisions of
this chapter.
deleted text end

Sec. 73.

Minnesota Statutes 2024, section 308C.545, subdivision 3, is amended to read:

Subd. 3.

Voting method.

A member's vote at a member meeting shall be in person or
by mail if a mail vote is authorized by the board or by alternative method if authorized by
the board. new text begin Except as provided in subdivisions 6 and 7, a member's vote must not be made
by proxy.
new text end

Sec. 74.

Minnesota Statutes 2024, section 308C.545, subdivision 5, is amended to read:

Subd. 5.

deleted text begin Jointly owned membership interest deleted text end new text begin Unit occupied by more than one
member new text end .

If deleted text begin membership interest is owned by two or more individuals, any individual may
vote on a matter that is before the members, unless the cooperative receives written notice
denying the authority of an individual to vote on the behalf of the jointly owned membership
interest deleted text end new text begin a unit is occupied by more than one member, only one person may cast the vote for
the membership new text end . new text begin If the members fail to agree and notify the cooperative as to who shall cast
the vote, the vote must not be cast.
new text end

Sec. 75.

Minnesota Statutes 2024, section 308C.545, is amended by adding a subdivision
to read:

new text begin Subd. 6. new text end

new text begin Spouse may vote for member. new text end

new text begin If a vote of members is taken on any matter,
the spouse of the member may vote on behalf of the member unless the member has indicated
otherwise.
new text end

Sec. 76.

Minnesota Statutes 2024, section 308C.545, is amended by adding a subdivision
to read:

new text begin Subd. 7. new text end

new text begin Members represented by delegates, conservator, or attorney-in-fact. new text end

new text begin A
cooperative may provide in its articles or bylaws that a member is entitled to be represented
at member meetings by a delegate chosen by the member or by the conservator or
attorney-in-fact of the member, or another person in charge of the member's business affairs.
The delegate, conservator, or attorney-in-fact may vote on matters at the member meeting
in the same manner as the member.
new text end

Sec. 77.

Minnesota Statutes 2025 Supplement, section 308C.571, subdivision 1, is amended
to read:

Subdivision 1.

Member approval.

A cooperative, by affirmative vote of a majority of
the board present, may sell, lease, transfer, or otherwise dispose of all or substantially all
of its property and assets, including its good will, not in the usual and regular course of its
business, deleted text begin and grant a security interest in all or substantially all of the cooperatives property
and assets deleted text end whether or not in the usual and regular course of its business upon those terms
and conditions and for those considerations, which may be money, securities, or other
instruments for the payment of money or other property, as the board considers expedient,
when approved at a regular or special meeting of the members new text begin at which a quorum is present,
new text end by the affirmative vote of new text begin two-thirds of new text end the deleted text begin owners of a majority of the voting power of the
interests entitled to vote deleted text end new text begin entire membership of record new text end . Written notice of the meeting must
be given to all members deleted text begin whether or not they are entitled to vote at the meeting deleted text end . The written
notice must state that a purpose of the meeting is to consider the sale, lease, transfer, or
other disposition of all or substantially all of the property and assets of the cooperative.

Sec. 78.

new text begin [308C.572] GRANT OF A SECURITY INTEREST IN COOPERATIVE.
new text end

new text begin Subdivision 1. new text end

new text begin Generally. new text end

new text begin (a) Unless otherwise provided in the cooperative's articles or
bylaws, following the first annual meeting of the members, the cooperative may grant a
security interest in all or substantially all of the cooperative's property and assets upon those
terms and conditions and for those considerations as are recommended by the board and
approved by the affirmative vote of a majority of the entire membership of record, at a duly
called regular or special meeting of the members at which a quorum is present.
new text end

new text begin (b) Written notice of the meeting must be given to all members according to sections
308C.511 and 308C.515, as applicable. The written notice must state that the purpose of
the meeting is to consider the grant of a security interest in all or substantially all of the
cooperative's property and assets.
new text end

new text begin (c) Before the first annual meeting of the members, the power to grant a security interest
in all or substantially all of the cooperative's property and assets is vested in the cooperative's
initial board.
new text end

new text begin Subd. 2. new text end

new text begin Confirmatory documents. new text end

new text begin Confirmatory contracts, notes, security instruments,
mortgages, and other documents may be signed and delivered at any time in the name of
the cooperative by its current president of the board or authorized agents.
new text end

Sec. 79.

new text begin [308C.580] INSURANCE.
new text end

new text begin Subdivision 1. new text end

new text begin Insurance required. new text end

new text begin Beginning no later than the initial commencement
of project occupancy by members, the cooperative shall maintain, to the extent reasonably
available:
new text end

new text begin (1) subject to subdivision 2, property insurance on the common elements, for broad form
covered causes of loss, and in a total amount of not less than the full insurable replacement
cost of the insured property, less deductibles, at the time the insurance is purchased and at
each renewal date, exclusive of items normally excluded from property policies; and
new text end

new text begin (2) commercial general liability insurance against claims and liabilities arising in
connection to the ownership, existence, use, or management of the property in an amount
sufficient in the judgment of the board, insuring the board, the cooperative, the cooperative's
management agent, and their respective employees, agents, and all persons acting as agents.
The members shall be included as additional insureds. The insurance shall cover claims of
one or more insured parties against other insured parties.
new text end

new text begin Subd. 2. new text end

new text begin Specific coverage; member requirements. new text end

new text begin (a) The insurance maintained under
subdivision 1 shall include the units or structures within the units and the common elements.
The insurance shall cover the following items owned by the cooperative within the units:
new text end

new text begin (1) ceiling or wall finishing materials;
new text end

new text begin (2) finished flooring;
new text end

new text begin (3) cabinetry;
new text end

new text begin (4) finished millwork;
new text end

new text begin (5) electrical, heating, ventilating, and air conditioning equipment, and plumbing fixtures
serving a single unit;
new text end

new text begin (6) appliances; or
new text end

new text begin (7) other improvements and betterments owned and installed by the cooperative,
regardless of when installed by the cooperative.
new text end

new text begin (b) If any improvements and betterments are covered under this subdivision, increased
costs may be assessed by the cooperative against the units affected. The cooperative may
also, in the case of a claim for damage to a unit or units:
new text end

new text begin (1) pay the deductible amount as a common expense;
new text end

new text begin (2) assess the deductible amount against one or more of the units affected in any
reasonable manner;
new text end

new text begin (3) require the members of one or more of the units affected to pay the deductible amount
directly;
new text end

new text begin (4) require the members to maintain insurance commonly known as gap insurance for
their respective units; and
new text end

new text begin (5) direct members to report losses and pay deductibles before taking any other action
under this subdivision.
new text end

new text begin Subd. 3. new text end

new text begin Notice to members; other insurance. new text end

new text begin If the insurance described in subdivisions
1 and 2 is not reasonably available, the cooperative shall promptly send notice of that fact
to be hand-delivered or sent prepaid by United States mail to all members. The cooperative
may carry any other insurance it considers appropriate to protect the cooperative, the members
or officers of the cooperative, or directors or agents of the cooperative.
new text end

new text begin Subd. 4. new text end

new text begin Insurance policy provisions. new text end

new text begin Insurance policies carried pursuant to subdivisions
1 and 2 must provide that:
new text end

new text begin (1) each member and holder of any blanket mortgage on the project is an insured person
under the policy with respect to liability arising out of the member's use of the common
elements in the cooperative's project;
new text end

new text begin (2) the insurer waives its right to subrogation under the policy against any member and
members of the member's household and against the cooperative and members of the board
of directors;
new text end

new text begin (3) no act or omission by any member or secured party, unless acting within the scope
of authority on behalf of the cooperative, shall void the policy or be a condition to recovery
under the policy; and
new text end

new text begin (4) if at the time of loss under the policy there is other insurance in the name of a member
covering the same property covered by the policy, the cooperative's policy is the primary
insurance, but the board may nonetheless direct that a member report losses under the
member's gap insurance policy and pay deductibles as required by that policy.
new text end

new text begin Subd. 5. new text end

new text begin Insurance proceeds; trust. new text end

new text begin Any loss covered by the property policy under
subdivision 1 shall be adjusted by and with the cooperative. The insurance proceeds for the
loss shall be payable to the cooperative, or to an insurance trustee designated by the
cooperative for that purpose. The insurance trustee or the cooperative shall hold any insurance
proceeds in trust for members and secured parties as their interests may appear. The proceeds
shall be disbursed first for the repair or restoration of the damaged common elements and
units. If there is a surplus of proceeds after the common elements and units have been
completely repaired or restored or the cooperative is dissolved, the board may retain the
surplus for use by the cooperative or distribute the surplus among the members on an
equitable basis as determined by the board.
new text end

new text begin Subd. 6. new text end

new text begin Member's gap insurance. new text end

new text begin In addition to the insurance carried by the
cooperative, a member may obtain personal insurance coverage, commonly known as gap
insurance coverage, at the member's own expense, covering the building deductible under
property insurance maintained by the cooperative and fire insurance or other casualty
insurance for the interior of the unit, such as decorations, improvements, and betterments
installed by the member, to the member's personal property, including the replacement cost
of approved upgrades in excess of the replacement cost of the cooperative's standards for
such property items, and liability insurance on the interior of the unit as established by the
cooperative.
new text end

new text begin Subd. 7. new text end

new text begin Certificates. new text end

new text begin An insurer that has issued an insurance policy under this section
shall issue certificates or memoranda of insurance, upon request, to any member or secured
party. The insurance may not be canceled until 60 days after notice of the proposed
cancellation has been mailed to the cooperative, each member, and each secured party for
an obligation to whom certificates of insurance have been issued.
new text end

new text begin Subd. 8. new text end

new text begin Repairs. new text end

new text begin (a) Any portion of the project that is damaged or destroyed as the
result of a loss covered by the cooperative's insurance shall be promptly repaired or replaced
by the cooperative unless:
new text end

new text begin (1) the cooperative is dissolved;
new text end

new text begin (2) repair or replacement would be illegal under any state or local health or safety statute
or ordinance; or
new text end

new text begin (3) 80 percent of the members, including every member and holder of a security interest
in the member's membership that is appurtenant to a unit that will not be rebuilt, vote not
to rebuild.
new text end

new text begin (b) Subject to subdivision 2, the cost of repair or replacement of the common elements
and units in excess of insurance proceeds and reserves shall be paid as a common expense.
new text end

new text begin (c) If less than the entire project is repaired or replaced:
new text end

new text begin (1) the insurance proceeds attributable to the damaged common elements and units shall
be used to restore the damaged areas to a condition compatible with the remainder of the
cooperative's undamaged common elements and units;
new text end

new text begin (2) the insurance proceeds attributable to the units and common elements that are not
rebuilt shall be distributed to members whose memberships are appurtenant to those units,
and the secured parties relative to those units, as their interests may appear; and
new text end

new text begin (3) the remainder of the proceeds shall be distributed to all the members and secured
parties as their interests may appear in proportion to their common expense liability.
new text end

new text begin Subd. 9. new text end

new text begin Effect of dissolution. new text end

new text begin If the cooperative is dissolved, the insurance proceeds
not used for repair or replacement shall be distributed in the same manner as sales proceeds
pursuant to section 308C.905.
new text end

Sec. 80.

new text begin [308C.582] UPKEEP OF COOPERATIVE.
new text end

new text begin Subdivision 1. new text end

new text begin Division of responsibility. new text end

new text begin Except to the extent provided by the bylaws,
proprietary lease, subdivision 2, or section 308C.580:
new text end

new text begin (1) the cooperative is responsible for the maintenance, repair, and replacement of the
common elements, the units, and property owned by the cooperative within the units; and
new text end

new text begin (2) each member is responsible for:
new text end

new text begin (i) the maintenance, repair, and replacement of the member's personal property and
household goods in the member's unit; and
new text end

new text begin (ii) the replacement cost of approved upgrades within the unit in excess of the replacement
cost of the cooperative's standards for such property items.
new text end

new text begin Subd. 2. new text end

new text begin Damage by member, guest, or subtenant. new text end

new text begin Damage to the common elements
or any unit as a result of the negligent or intentional acts or omissions of a member or the
member's guest or subtenant is the responsibility of the member.
new text end

new text begin Subd. 3. new text end

new text begin Maintenance plan; modifications; copies. new text end

new text begin The cooperative's board shall, no
later than the cooperative's first annual meeting as provided in section 308C.603, prepare
and approve a balance sheet and a written preventative maintenance plan, maintenance
schedule, and maintenance budget for the common elements and units. The maintenance
budget may be included in the cooperative's annualized budget for the project. The
cooperative must follow the approved preventative maintenance plan. The cooperative's
board may amend, modify, or replace an approved preventative maintenance plan or an
approved maintenance schedule from time to time. The cooperative must provide all members
with a paper copy, electronic copy, or electronic access to the preventative maintenance
plan, the maintenance schedule, and any amendments or modifications to or replacements
of the preventative maintenance plan and the maintenance schedule.
new text end

new text begin Subd. 4. new text end

new text begin Access to units. new text end

new text begin The cooperative shall have access through and into each unit
for purposes of performing maintenance, repair, or replacement within the cooperative's
responsibility. The cooperative and any public safety personnel shall have access for purposes
of abating or correcting any condition in the unit that: (1) violates any state or local law,
ordinance, or regulation; (2) may cause material damage to or jeopardize the safety of the
cooperative's units, buildings, or project; or (3) may constitute a health or safety hazard for
occupants of the units.
new text end

Sec. 81.

Minnesota Statutes 2024, section 308C.601, is amended by adding a subdivision
to read:

new text begin Subd. 1a. new text end

new text begin Generally. new text end

new text begin A membership interest in a cooperative subject to this chapter is,
at all times, personal property. A member has no interest in specific cooperative property
except the right to occupy a unit pursuant to a proprietary lease and use of the common
elements. All property of the cooperative is property of the cooperative itself.
new text end

Sec. 82.

Minnesota Statutes 2024, section 308C.601, is amended by adding a subdivision
to read:

new text begin Subd. 1b. new text end

new text begin Number of membership interests. new text end

new text begin One membership shall be issued by the
cooperative for each unit in the project. The resulting number of memberships outstanding
at all times is equal to the number of units in the project.
new text end

Sec. 83.

Minnesota Statutes 2024, section 308C.601, subdivision 2, is amended to read:

Subd. 2.

Issuance of membership interests new text begin ; certificated new text end .

new text begin (a) new text end Authorized membership
interests may be issued on terms and conditions prescribed in the articles deleted text begin , deleted text end new text begin or new text end bylaws deleted text begin , or if
authorized in the articles or bylaws as determined by the board. The cooperative shall
disclose to any person or entity acquiring membership interests to be issued by the
cooperative, the organization, capital structure, and known business prospects and risks of
the cooperative, the nature of the governance and financial rights of the membership interest
being acquired and of other classes of membership and membership interests deleted text end .

new text begin (b) The membership interests of a cooperative must be certificated. The interest of each
individual member in the cooperative shall be evidenced by the issuance of a membership
certificate. The membership certificate is coupled with a possessory interest in the real and
personal property of the cooperative that entitles each member to a proprietary lease with
the cooperative under which the member has an exclusive possessory interest in a unit and
a possessory interest in common with all other members in that portion of the cooperative's
real and personal property not constituting units. The proprietary lease creates a legal
relationship of landlord and tenant between the cooperative and member.
new text end

new text begin (c) Membership certificates shall be issued upon certification of full payment by the
cooperative's secretary.
new text end

Sec. 84.

Minnesota Statutes 2024, section 308C.601, is amended by adding a subdivision
to read:

new text begin Subd. 2a. new text end

new text begin Signature; prima facie evidence. new text end

new text begin (a) Membership certificates must be signed
by an agent or officer authorized in the articles or bylaws to sign membership certificates
or, in the absence of an authorized agent or officer, by the president or vice president and
secretary of the cooperative. If a person signs or has a facsimile signature placed upon a
certificate in the presence of an authorized agent or officer, the certificate may be issued
by the cooperative with the same effect as if the agent or officer had authorization on the
date of the certificate's issuance if the agent or officer is not authorized when the certificate
is issued.
new text end

new text begin (b) A certificate signed as provided under this subdivision is prima facie evidence of
the ownership of the membership interest referred to in the certificate.
new text end

Sec. 85.

Minnesota Statutes 2024, section 308C.601, is amended by adding a subdivision
to read:

new text begin Subd. 2b. new text end

new text begin Form of certificate. new text end

new text begin A certificate representing a membership interest of a
cooperative shall contain on its face:
new text end

new text begin (1) the name of the cooperative;
new text end

new text begin (2) a statement that the cooperative is organized under the laws of the state and this
chapter;
new text end

new text begin (3) the name of the person to whom the certificate is issued and, in the case of a life
estate, trust, or transfer on death registration under section 308C.602, the name of the member
occupant and the remainderman, trustee, or transfer on death beneficiary, as applicable;
new text end

new text begin (4) statement that the membership represented by the certificate is, except as between
spouses, transferable only as an entirety and only to a natural person approved by the board
for membership in the cooperative;
new text end

new text begin (5) if the cooperative's articles or bylaws create an option or first privilege in favor of
the cooperative to purchase the membership of a deceased or departing member or assign
the cooperative's purchase option to a buyer approved by the cooperative for membership,
a statement of the option, which may be made by reference back to the articles or bylaws
that further describe the option, and a statement that any transfer of the membership
represented by the certificate is subject to the option;
new text end

new text begin (6) a statement of any other restrictions on transfer, including approval of the board;
new text end

new text begin (7) a statement that the cooperative has a lien on the membership and unit represented
by the certificate for all assessments due and to become due under the proprietary lease;
and
new text end

new text begin (8) a statement that the cooperative may refuse to consent to the transfer of the
membership presented by the member to the cooperative until all outstanding sums due
under the proprietary lease are paid or for other reasonable cause described in the bylaws.
new text end

Sec. 86.

Minnesota Statutes 2024, section 308C.601, subdivision 6, is amended to read:

Subd. 6.

Cooperative first right to purchase membership interests.

The articles or
bylaws may provide that the cooperative deleted text begin or the occupant members, individually or
collectively, have the deleted text end new text begin has an option or new text end first privilege of purchasing the membership interests
deleted text begin of any class of membership interests offered for sale deleted text end new text begin to be sold. The option or first privilege
may be exercised by the cooperative through (1) purchasing the membership, or (2) assigning
the cooperative's purchase option to a buyer approved by the board for membership in the
cooperative new text end . The new text begin cooperative's option or new text end first privilege to purchase membership interests
may be deleted text begin satisfied by notice to other members that the membership interests are for sale and
a procedure by which members may proceed to attempt to purchase and acquire the
membership interests. A membership interest acquired by the cooperative may be held to
be reissued or may be retired and canceled deleted text end new text begin exercised under the circumstances, conditions,
or limitations enumerated in the cooperative's bylaws or articles new text end .

Sec. 87.

Minnesota Statutes 2024, section 308C.602, is amended to read:

308C.602 TITLE TO MEMBERSHIP IN THE COOPERATIVE.

(a) Title to membership in a cooperative governed by this chapter may be held by:

(1) a deleted text begin natural person who satisfies the member restrictions set forth in this chapter deleted text end new text begin member
individually new text end ;

new text begin (2) members through joint tenancy or tenancy in the entirety or, to the extent not
prohibited by the articles or bylaws, tenancy in common;
new text end

new text begin (3) a member or members holding title as joint tenants, subject to a transfer on death
beneficiary registration in accordance with the Minnesota Uniform TOD Security Registration
Act, sections 524.6-301, et. seq., except as prohibited, limited, or otherwise provided by
the cooperative;
new text end

deleted text begin (2) deleted text end new text begin (4) new text end a natural person deleted text begin who does not satisfy the restrictions set forth in this chapter but deleted text end
who purchases a membership interest for a deleted text begin natural person who satisfies the restrictions set
forth in this chapter and who is a deleted text end member deleted text begin of the cooperative and shall, for purposes of this
section, be referred to as a "third-party purchaser" deleted text end new text begin , except as prohibited, limited, or otherwise
provided by the cooperative new text end ;

deleted text begin (3) deleted text end new text begin (5) new text end a natural person who is the trustee of a trust, except as prohibited, limited, or
otherwise provided by the cooperative. If title to a membership interest is held by a trustee
of a trust, deleted text begin a beneficiary of the trust must be a natural person who satisfies the restriction set
forth in this chapter and who exercises the right of occupancy appurtenant to membership.
In order to apply for membership in the cooperative following the death of a member or
members who occupied the cooperative under the trust's title, a successor beneficiary of the
trust must satisfy the restriction structure set forth in this chapter. The cooperative may
require successor beneficiaries who did not occupy the dwelling unit with the deceased
cooperative member or members to offer the membership interest back to the cooperative
for sale pursuant to any cooperative right of first refusal, cooperative purchase option, or
other membership sale requirements or restrictions established by the cooperative in its
bylaws or through the cooperative's policies, rules, or regulations deleted text end new text begin the members residing in
a unit must be beneficiaries of the trust and the member or spouse of the member must be
the grantor of the trust new text end ; new text begin and
new text end

deleted text begin (4) deleted text end new text begin (6) new text end an adult natural person remainderman, subject to a life estate retained by a deleted text begin natural
person who satisfies the restrictions set forth in this chapter and who exercises the right of
occupancy appurtenant to membership in the dwelling unit, except as prohibited, limited,
or otherwise provided by the bylaws. In order to apply for membership in the cooperative
following the death of the life tenant member or members of the cooperative, a remainderman
must satisfy the age restriction structure set forth in this chapter for membership in the
cooperative. Following the death of the life tenant member, a cooperative may require a
remainderman to offer the membership interest back to the cooperative for sale pursuant to
any cooperative right of first refusal, cooperative purchase option, or other membership
sale requirements or restrictions established by the cooperative in its bylaws or through the
cooperative's policies, rules, or regulations; deleted text end new text begin member, except as prohibited, limited, or
otherwise provided by the cooperative.
new text end

deleted text begin (5) transfer on death (TOD) beneficiaries upon the death of a member in the cooperative
and in accordance with the Minnesota Uniform TOD Security Registration Act, sections
524.6-301, et. seq., except as prohibited, limited, or otherwise provided by the cooperative.
A natural person who, as a TOD beneficiary, becomes the title holder of a membership
interest in the cooperative following the death of a member must satisfy the restriction
structure set forth in this chapter in order to apply for membership in the cooperative. A
cooperative may require a TOD beneficiary who becomes the title holder of a membership
interest in the cooperative following the death of a member to offer the membership interest
back to the cooperative for sale pursuant to any cooperative right of first refusal, cooperative
purchase option, or other membership sale requirements or restrictions the cooperative may
have developed in its bylaws or through the cooperative's policies, rules, or regulations;
and
deleted text end

deleted text begin (6) with respect to nonoccupant membership interest, any person as defined by this
chapter.
deleted text end

(b) In each instance in which title to a membership interest is held by a trustee,
remainderman, or third-party purchaser deleted text begin who purchases a membership interest for a member
who will occupy the cooperative deleted text end , the trustee, remainderman, or third-party purchaser shall
agree to abide by the cooperative's articles, bylaws, deleted text begin occupancy agreement or deleted text end proprietary
lease deleted text begin of deleted text end new text begin with new text end the member, deleted text begin and deleted text end rules, policies, and regulations deleted text begin of the cooperative, deleted text end and shall
not, by virtue of their status of holding title to the membership interest, have any voting
rights that a member of the cooperative would otherwise have by reason of being the holder
of a membership certificate. All voting rights shall be vested solely with the member who
occupies the cooperative.

new text begin (c) The cooperative may, through the cooperative's bylaws or articles:
new text end

new text begin (1) require the successor trustee, remainderman, third-party purchaser, or transfer on
death beneficiary to offer the membership interest back to the cooperative for sale, upon
the death of the member, pursuant to any cooperative option or first privilege to purchase
that is set forth in the cooperative's articles or bylaws or other membership sale requirements
or restrictions established by the cooperative in the cooperative's bylaws or through the
cooperative's policies, rules, or regulations; or
new text end

new text begin (2) allow the remainderman, third-party purchaser, transfer on death beneficiary or, in
the case of a trust, another beneficiary of the trust, to apply for membership in the cooperative
following the death of the member, provided:
new text end

new text begin (i) the remainderman, third-party purchaser, or transfer on death beneficiary satisfies
the restrictions under this chapter and the membership eligibility criteria; and
new text end

new text begin (ii) in the case of a trust, the current trustee of the trust agrees to continue to pay all
assessments levied against the membership if the trust beneficiary does not pay assessments
levied against the membership.
new text end

new text begin (d) For purposes of this section, "third-party purchaser" means a natural person under
paragraph (a), clause (4).
new text end

Sec. 88.

Minnesota Statutes 2024, section 308C.603, subdivision 1, is amended to read:

Subdivision 1.

Developer control.

If a developer causes a cooperative to be organized
under this chapter, the developer shall have the right to appoint an initial board of directors
consisting of three persons. The developer's control of the board shall terminate on the date
of the first annual meeting of members. The first annual meeting shall occur on or about deleted text begin 60 deleted text end new text begin
90 new text end days after the date of the certificate of occupancy issued for the project by the municipality
in which the project is situated deleted text begin and deleted text end new text begin , new text end subject to any requirements under the mortgage for
permanent financing related to the project.

Sec. 89.

Minnesota Statutes 2024, section 308C.603, subdivision 4, is amended to read:

Subd. 4.

Developer's obligation for assessments.

(a) Prior to the commencement of
occupancy of the project by the members, the developer shall pay all accrued expenses of
the cooperative.

(b) After the commencement of occupancy of the project by the members, the developer
shall deleted text begin pay all common expenses and payments to reserves allocated to the dwelling unit
appurtenant to the membership interests that have not been conveyed to members, and the
payment obligation shall remain in effect until each unissued membership interest has been
conveyed to a member deleted text end new text begin pay all assessments allocated to the unsold membership interests
and units appurtenant to the interests until the earlier of:
new text end

new text begin (1) five years from the date of the cooperative's first annual meeting under section
308C.603; or
new text end

new text begin (2) the date the last of the memberships remaining unsold on the date of the first annual
meeting are sold to the initial purchasers new text end .

Sec. 90.

Minnesota Statutes 2024, section 308C.603, is amended by adding a subdivision
to read:

new text begin Subd. 5. new text end

new text begin Developer's obligation to complete and restore. new text end

new text begin Except for improvements
labeled "NEED NOT BE BUILT", the developer shall complete all improvements depicted
on the plans and specifications for the project's construction and as-built survey with respect
to the project.
new text end

Sec. 91.

Minnesota Statutes 2024, section 308C.612, subdivision 1, is amended to read:

Subdivision 1.

Generally.

deleted text begin The senior housing deleted text end new text begin (a) A new text end cooperative organized under this
chapter shall provide to each deleted text begin subscriber for deleted text end new text begin prospective purchaser of new text end a membership in the
cooperative:

(1) deleted text begin an occupancy agreement or deleted text end new text begin a purchase agreement;
new text end

new text begin (2) a new text end proprietary lease;

deleted text begin (2) deleted text end new text begin (3) new text end the articles new text begin , bylaws, rules, regulations, and policies of the cooperative new text end ;

deleted text begin (3) the bylaws;
deleted text end

deleted text begin (4) an annualized budget for the current fiscal period; and
deleted text end

deleted text begin (5)(i) for the initial purchase of a membership interest to which a particular dwelling
unit is appurtenant, an information bulletin and a subscription agreement; and
deleted text end

deleted text begin (ii) deleted text end new text begin (4) new text end for deleted text begin any purchase of deleted text end new text begin the sale of any membership to the first purchaser and member,
an information bulletin; and
new text end

new text begin (5) for the resale of new text end a membership interest after deleted text begin its deleted text end new text begin the new text end initial purchase, a resale disclosure
deleted text begin statement and a membership purchase and sale agreement, all of which shall minimally
include the contents of the provisions set forth in subdivisions 2 to 6, as applicable deleted text end new text begin certificate new text end .

new text begin (b) A cooperative is not required to prepare or deliver an information bulletin or resale
disclosure certificate in the case of:
new text end

new text begin (1) a gratuitous transfer;
new text end

new text begin (2) a transfer pursuant to a court order;
new text end

new text begin (3) a transfer to a government agency;
new text end

new text begin (4) a transfer to a secured party by foreclosure or deed in lieu of foreclosure; or
new text end

new text begin (5) an option to purchase a membership, until exercised.
new text end

Sec. 92.

Minnesota Statutes 2024, section 308C.612, subdivision 2, is amended to read:

Subd. 2.

Information bulletin.

(a) With respect to an initial sale of a cooperative's
authorized membership interests deleted text begin to older persons deleted text end , each deleted text begin subscriber for deleted text end new text begin prospective purchaser
of a new text end membership shall be given an information bulletin that shall fully and accurately
disclose:

(1) the name and principal address of the cooperative;

(2) the number of deleted text begin dwelling deleted text end units in the project;

(3) a general description of the project, including, at a minimum:

(i) the number of buildings;

(ii) the number of deleted text begin dwellings deleted text end new text begin units new text end per building new text begin or per lot new text end ;

(iii) the type of construction;

(iv) whether the project involves new construction or rehabilitation;

(v) whether any building was wholly or partially occupied, for any purpose, before it
was added to the project and the nature of the occupancy;

(vi) a general description of any roads, trails, or utilities that are located on the common
elements and that the cooperative is required to maintain;

(vii) the name of the developer, the developer's credentials, and the credentials of the
persons constituting the initial board of directors of the cooperative; and

(viii) a statement that the developer shall new text begin pay and new text end be financially liable for all deleted text begin of the
common expenses and costs deleted text end new text begin assessments new text end allocated to the deleted text begin unsold deleted text end membership interests new text begin
remaining unsold on the date of the cooperative's first annual meeting, new text end and deleted text begin dwelling deleted text end new text begin the new text end
units appurtenant thereto new text begin , new text end until deleted text begin such membership interests are sold deleted text end new text begin the earlier of five years
from the date of the cooperative's first annual meeting under section 308C.603 or the date
upon which the last of the memberships remaining unsold on the date of the first annual
meeting are sold new text end to the initial purchasers thereof;

new text begin (4) the names of the cooperative's initial board members;
new text end

deleted text begin (4) deleted text end new text begin (5) new text end the cooperative's new text begin anticipated new text end schedule of commencement and completion of
construction of any buildings and other improvements that the cooperative new text begin or developer new text end is
obligated to build;

new text begin (6) a statement regarding whether the cooperative's units will be substantially completed
at the time the units are conveyed through execution of proprietary leases and issuance of
executed membership certificates and, if not substantially completed, the person responsible
to complete and pay for the construction of the units;
new text end

new text begin (7) the terms of any warranties provided by the developer, including copies of sections
308C.630 to 308C.633, and any other applicable statutory warranties and a statement of
any limitations on the enforcement of the applicable warranties or on damages;
new text end

new text begin (8) a statement that:
new text end

new text begin (i) within ten days after the receipt of an information bulletin, a purchaser may cancel
any contract for the purchase of a membership from the cooperative, provided that the right
to cancel terminates upon the earlier of the purchaser's:
new text end

new text begin (A) execution of a proprietary lease;
new text end

new text begin (B) acceptance of a membership certificate evidencing ownership of a membership in
the cooperative; or
new text end

new text begin (C) waiver of the right to cancel in the manner provided under this section;
new text end

new text begin (ii) if a purchaser receives a disclosure statement more than ten days before signing a
purchase agreement, the purchaser cannot cancel the purchase agreement;
new text end

new text begin (iii) if the cooperative is obligated to deliver an information bulletin and fails to deliver
to the purchaser an information bulletin that substantially complies with this chapter during
any period of time that the developer controls the cooperative's board pursuant to section
308C.603, the developer is liable to the purchaser in the amount of $5,000, in addition to
any damages or other amounts recoverable under this chapter or otherwise;
new text end

new text begin (iv) if after termination of the developer's control of the board pursuant to section
308C.603, the cooperative is obligated to deliver an information bulletin and fails to deliver
to the purchaser an information bulletin that substantially complies with this chapter, liability
to the purchaser for the amounts recoverable under section 308C.612, subdivision 4,
paragraph (d), as between the cooperative and developer, is assumed by the party who is
controlling the marketing and sales of any memberships to the initial purchasers;
new text end

new text begin (v) any action brought by a purchaser under this section shall be commenced within the
time period specified in section 308C.633; and
new text end

new text begin (vi) if a developer or the cooperative has, in good faith, attempted to comply with the
requirements of section 308C.612, subdivisions 1 and 2, and has substantially complied
with the disclosure requirements of this chapter, nonmaterial errors or omissions in the
disclosure materials are not actionable;
new text end

new text begin (9) a statement, with the name and address of the escrow agent, describing how earnest
money tendered by a purchaser in connection with the purchase of a membership will be
held in and disbursed from the escrow account, as set forth in section 308C.6121, and that
the earnest money will be returned to the purchaser if the purchaser cancels the purchase
agreement pursuant to this section;
new text end

deleted text begin (5) deleted text end new text begin (10) new text end any expenses or services not reflected in the budget that the cooperative pays
or provides that may become a common expense and the projected common expense
attributable to each of those expenses or services;

new text begin (11) any special fees or charges, separate from the members' monthly assessments, to
be paid by members for the use of common elements, including guest suites, banquet rooms,
or other facilities;
new text end

deleted text begin (6) deleted text end new text begin (12) new text end identification of any liens, defects, or encumbrances that will continue to affect
the title to a dwelling unit or to any real property owned by the cooperative after the
contemplated conveyance;

deleted text begin (7) deleted text end new text begin (13) new text end a statement disclosing to the extent of the cooperative's or an affiliate of a
cooperative's actual knowledge, after reasonable inquiry, any unsatisfied judgments or
lawsuits to which the cooperative is a party, and the status of those lawsuits which are
material to the project or the deleted text begin dwelling deleted text end unit appurtenant to a membership being purchased;

deleted text begin (8) deleted text end new text begin (14) new text end a summary of the insurance coverage provided by the cooperative for the benefit
of members, and a detailed description of the insurance coverage that members are
encouraged to purchase for their own benefit;

deleted text begin (9) deleted text end new text begin (15) new text end a statement describing:

(i) whether the members are entitled for federal and state tax purposes to deduct payments
made by the cooperative for real estate taxes and interest paid to the holder of a security
interest encumbering the cooperative;

(ii) deleted text begin a statement as to deleted text end the effect on the members if the cooperative fails to pay real estate
taxes or payments due the holder of a security interest encumbering the deleted text begin cooperative deleted text end new text begin
cooperative's project new text end ; deleted text begin and
deleted text end

(iii) the principal amount and a general description of the terms of any blanket mortgage
contract for deed, or other blanket security instrument encumbering the deleted text begin cooperative property deleted text end new text begin
cooperative's project new text end ; new text begin and
new text end

new text begin (iv) any other financial arrangements, including contingencies, that have been made to
provide for the completion of all improvements to be constructed on the cooperative's
project;
new text end

deleted text begin (10) deleted text end new text begin (16) new text end a statement:

(i) that real estate taxes for the deleted text begin dwelling deleted text end unit or any real property owned by the
cooperative are not delinquent, or if there are delinquent real estate taxes, describing the
property for which the taxes are delinquent, stating the amount of the delinquent taxes,
interest, and penalties, and stating the years for which taxes are delinquent; and

(ii) setting forth the amount of real estate taxes expected to be allocated to the deleted text begin dwelling deleted text end
units, including the amount of any special assessments certified for payment with the real
estate taxes, due and payable with respect to the deleted text begin dwelling deleted text end unit in the year in which the
information bulletin is given new text begin if real estate taxes were separately assessed against the unit new text end ;

deleted text begin (11) deleted text end new text begin (17) new text end any recorded covenants, conditions restrictions, and reservations affecting the
project; a statement that the deleted text begin occupancy agreement deleted text end new text begin proprietary lease new text end must be signed at the
closing; and a statement that members are required to abide by the bylaws, the articles deleted text begin of
incorporation deleted text end , and the rules, regulations, and policies of the cooperative, including
amendments from time to time;

deleted text begin (12) deleted text end new text begin (18) new text end a brief deleted text begin narrative deleted text end description of any material agreements entered into between
the cooperative and a governmental entity that affect the project;

deleted text begin (13) a budget prepared by the developer; and
deleted text end

deleted text begin (14) deleted text end new text begin (19) new text end a statement that purchase and sales of memberships and rights under deleted text begin occupancy
agreements deleted text end new text begin proprietary leases new text end are not for speculative purposes and that investments in the
cooperative by members are for the sole purpose of securing and acquiring a deleted text begin dwelling deleted text end unit
for their residential use and benefit deleted text begin . deleted text end new text begin ;
new text end

new text begin (20) a description of the circumstances under which the cooperative may impose liens
against membership interests and occupancy rights, how the cooperative forecloses on a
lien, the process the cooperative may use to remove a member and an occupant from a unit,
and the circumstances and processes under which the cooperative may levy fines, suspend
member voting rights, and terminate the membership and occupancy rights of a cooperative's
member and transfer or dispose of a terminated member's membership; and
new text end

new text begin (21) copies of the following documents:
new text end

new text begin (i) articles, bylaws, rules and regulations, and policies of the cooperative;
new text end

new text begin (ii) any recorded covenants, conditions, restrictions, or reservations affecting the
cooperative's project land;
new text end

new text begin (iii) any agreement excluding or modifying any implied warranties;
new text end

new text begin (iv) any agreement reducing the statute of limitations for enforcing warranties;
new text end

new text begin (v) the subscription agreement for the purchase of a membership from the cooperative;
new text end

new text begin (vi) the proprietary lease for occupancy of the member's unit;
new text end

new text begin (vii) a projected budget for the first year of the cooperative's operation;
new text end

new text begin (viii) a balance sheet, if developed at the time the information bulletin is issued, as
required under section 308C.582; and
new text end

new text begin (ix) an initial maintenance plan, initial maintenance schedule, and maintenance budget,
if developed at the time the information bulletin is issued, as required under section 308C.582.
new text end

new text begin (b) Copies of documents under paragraph (a), clause (21), may be provided in proposed
form if the closing on a construction loan or blanket mortgage that will finance the
construction of the cooperative's project has not yet occurred.
new text end

deleted text begin (b) deleted text end new text begin (c) new text end A cooperative shall promptly amend the information bulletin to reflect any material
change in the information required by this chapter.

Sec. 93.

Minnesota Statutes 2024, section 308C.612, subdivision 3, is amended to read:

Subd. 3.

Resale disclosure certificate.

(a) In the event of a resale of a membership
interest deleted text begin by either the departing member or by the cooperative deleted text end , the departing member deleted text begin or deleted text end new text begin ,
with the assistance of new text end the cooperative deleted text begin , as applicable deleted text end , shall furnish to the purchaser before
the execution of any purchase deleted text begin and sale deleted text end agreement deleted text begin for the applicable membership interest deleted text end
the following documents relating to the cooperative:

(1) copies of the articles deleted text begin and deleted text end new text begin , new text end bylaws, deleted text begin any deleted text end rules deleted text begin and deleted text end new text begin , new text end regulations, new text begin policies, new text end and any
amendments thereto; and

(2) a resale disclosure certificate new text begin that is dated not more than 90 days before the date of
the membership purchase and sale agreement or subscription agreement, new text end containing the
information set forth in paragraph (b).

(b) The resale disclosure certificate must provide the following information:

(1) the name new text begin and address new text end of the cooperative;

(2) the number of the deleted text begin dwelling deleted text end unit appurtenant to the subject membership interest new text begin ,
including the principal unit and any auxiliary units, such as garage stalls or storage lockers new text end ;

(3) the amount of the monthly deleted text begin common expense deleted text end assessments payable under the deleted text begin occupancy
agreement deleted text end new text begin proprietary lease new text end applicable to the subject deleted text begin dwelling deleted text end unit;

(4) the amount of other additional fees or charges payable by members, such as late
payment charges;

(5) extraordinary expenditures, if any, approved by the cooperative and not yet assessed
to members for the current and two succeeding fiscal years;

(6) the current balances in the cooperative's replacement reserve and the general operating
reserve, and any other reserves maintained by the cooperative;

(7) copies of the most current financial statements of the cooperative, including new text begin the
current annualized budget, maintenance plan, new text end balance sheet new text begin , new text end and income and expense
statements;

(8) a disclosure of any unsatisfied judgments against the cooperative;

(9) a statement that there are no pending lawsuits to which the cooperative is a party
deleted text begin except as specifically disclosed deleted text end new text begin or, if there are any pending lawsuits in which the cooperative
is a party, a statement of the case caption, case number, and court in which the lawsuit is
pending and a summary of the lawsuit's status new text end ;

new text begin (10) a description of the insurance coverages carried by the cooperative and a statement
of any insurance coverage that the cooperative requires or recommends the members procure;
new text end

new text begin (11) a description of the circumstances under which the cooperative may impose liens
against membership interests and occupancy rights, how the cooperative forecloses on a
lien, the process the cooperative may use to remove a member and an occupant from a unit,
and the circumstances and processes under which the cooperative may levy fines, suspend
member voting rights, and terminate the membership and occupancy rights of a cooperative's
member and transfer or dispose of a terminated member's membership;
new text end

deleted text begin (10) deleted text end new text begin (12) new text end a radon disclosure pursuant to the requirements of section 144.496; deleted text begin and
deleted text end

new text begin (13) a description of any restrictions on the transfer of the membership interest, including
but not limited to:
new text end

new text begin (i) a description of an option or first privilege of the cooperative to purchase the
membership or to assign the option to purchase to a prospective purchaser; and
new text end

new text begin (ii) any affordability or income, age, or other restrictions that would limit the prospective
purchasers to whom the membership may be sold or by whom the appurtenant unit may be
occupied;
new text end

new text begin (14) a description of any transfer value or other restrictions on the price for which the
membership can be sold and any conditions or limitations on the transfer value or other
sales price restriction; and
new text end

deleted text begin (11) deleted text end new text begin (15) new text end the resale disclosure certificate shall contain a certification by the subscribing
party that the information contained therein is true and correct as of the date of the
certification.

Sec. 94.

Minnesota Statutes 2024, section 308C.612, is amended by adding a subdivision
to read:

new text begin Subd. 7. new text end

new text begin Purchaser's right to cancel a purchase agreement after receipt of an
information bulletin. new text end

new text begin (a) A cooperative must provide at least one of the purchasers of the
membership with a copy of the information bulletin and all amendments before conveyance
of the membership, through issuance of a membership certificate, and conveyance of the
unit through execution of a proprietary lease. If the cooperative does not provide the
purchaser with an information bulletin more than ten days before execution of the purchase
agreement, the purchaser may, before conveyance of the membership and unit, cancel the
purchase agreement within ten days after first receiving the information bulletin. If the
cooperative provides the purchaser with the information bulletin more than ten days before
execution of the purchase agreement, the purchaser may not cancel the purchase agreement
pursuant to this section. The ten-day rescission period may be modified or waived, in writing,
by agreement of the purchaser of a membership to which the unit is appurtenant only after
the purchaser has received and had an opportunity to review the information bulletin. The
cooperative may not condition the sale of the membership on the purchaser agreeing to
modify or waive the purchaser's ten-day right of rescission, contractually obligate the
purchaser to modify or waive the purchaser's ten-day right of rescission, or include a
modification or waiver of the ten-day right of rescission in any purchase agreement for the
membership. To be effective, a modification or waiver of a purchaser's ten-day right of
rescission must be evidenced by an instrument separate from the purchase agreement signed
by the purchaser more than three days after the purchaser receives the disclosure statement.
new text end

new text begin (b) If an amendment to the information bulletin materially and adversely affects a
purchaser, the purchaser shall have ten days after delivery of the amendment to cancel the
purchase agreement in accordance with this section. The ten-day rescission period may be
modified or waived, in writing, by agreement of the purchaser of a membership only after
the purchaser has received and had an opportunity to review the amendment. To be effective,
a modification or waiver of a purchaser's ten-day right of rescission under this section must
be evidenced by a written instrument separate from the purchase agreement signed by the
purchaser more than three days after the purchaser receives the amendment.
new text end

new text begin (c) If a purchaser elects to cancel a purchase agreement pursuant to this section, the
purchaser may do so by giving the cooperative or the cooperative's agent written notice that
is effective:
new text end

new text begin (1) upon hand delivery;
new text end

new text begin (2) upon mailing if properly addressed with postage prepaid and deposited in the United
States mail; or
new text end

new text begin (3) if the cooperative or the cooperative's agent has provided an electronic address at
which the cooperative or cooperative's agent agrees to receive electronic communication
as defined in section 317A.011, subdivision 7a, by electronic communication sent to that
address.
new text end

new text begin Cancellation is without penalty, and all payments made by the purchaser before cancellation
shall be refunded promptly. Notwithstanding any provision in this section to the contrary,
the purchaser's cancellation rights under this section terminate upon the purchaser's
acceptance of a conveyance of the membership and unit.
new text end

new text begin (d) If the cooperative is obligated to deliver an information bulletin and fails to deliver
to the purchaser an information bulletin that substantially complies with this chapter during
any period of time that the developer controls the cooperative's board pursuant to section
308C.603, the developer is liable to the purchaser in the amount of $5,000, in addition to
any damages or other amounts recoverable under this chapter or otherwise. If, after
termination of the developer's control of the board pursuant to section 308C.603, the
cooperative is obligated to deliver an information bulletin and fails to deliver to the purchaser
an information bulletin which substantially complies with this chapter, liability to the
purchaser for the amounts recoverable under this subdivision, as between the cooperative
and developer, is assumed by the party controlling the marketing and sales of any
memberships to the initial purchasers. An action brought by a purchaser under this section
must be commenced within the time period specified in section 308C.633. If a developer
or the cooperative, in good faith, attempts to comply with the requirements of this subdivision
and has, in fact, substantially complied with the disclosure requirements of this chapter,
nonmaterial errors or omissions in the disclosure materials is not actionable.
new text end

Sec. 95.

Minnesota Statutes 2024, section 308C.612, is amended by adding a subdivision
to read:

new text begin Subd. 8. new text end

new text begin Purchaser's right to cancel a purchase agreement after receipt of a resale
disclosure certificate. new text end

new text begin (a) Unless a purchaser is given the information required to be delivered
by subdivision 3 more than ten days before the execution of the purchase agreement for a
membership interest appurtenant to the unit, the purchaser may, before the conveyance of
the unit through execution of a proprietary lease, cancel the purchase agreement within ten
days after receiving the information. The ten-day rescission period may be modified or
waived, in writing, by agreement of the purchaser only after the purchaser has received and
had an opportunity to review the information required to be delivered by subdivision 3. The
person required to deliver the information required under subdivision 3 may not condition
the sale of the membership interest on the purchaser agreeing to modify or waive the
purchaser's ten-day right of rescission, contractually obligate the purchaser to modify or
waive the purchaser's ten-day right of rescission, or include a modification or waiver of the
ten-day right of rescission in any purchase agreement for the membership interest. To be
effective, a modification or waiver of a purchaser's ten-day right of rescission must be
evidenced by an instrument separate from the purchase agreement signed by the purchaser
more than three days after the purchaser receives the resale disclosure certificate.
new text end

new text begin (b) A purchaser who elects to cancel a purchase agreement pursuant to paragraph (a),
may do so by giving written notice to the seller or the seller's agent that shall be effective:
new text end

new text begin (1) upon hand delivery;
new text end

new text begin (2) upon mailing if properly addressed with postage prepaid and deposited in the United
States mail; or
new text end

new text begin (3) if the seller or the seller's agent has provided an electronic address at which the seller
or seller's agent agrees to receive electronic communication as defined in section 317A.011,
subdivision 7a, by electronic communication sent to that address.
new text end

new text begin Cancellation is without penalty and all payments made by the purchaser shall be refunded
promptly.
new text end

Sec. 96.

Minnesota Statutes 2024, section 308C.612, is amended by adding a subdivision
to read:

new text begin Subd. 9. new text end

new text begin Required disclosure language to be incorporated into purchase
agreements. new text end

new text begin All purchase agreements must contain a provision which substantially conforms
with the following notices:
new text end

new text begin (1) "The following notice is required by Minnesota Statutes: The purchaser is entitled
to receive an information bulletin or resale disclosure certificate, as applicable. The
information bulletin or resale disclosure certificate contains important information regarding
the cooperative and the purchaser's cancellation rights."; and
new text end

new text begin (2) "Buyer's Right to Cancel. THE BUYER IS ENTITLED TO CANCEL THIS
AGREEMENT FOR ANY REASON WITHIN TEN (10) DAYS FROM AND AFTER
THE DATE THE BUYER ACTUALLY RECEIVED A COPY OF THE RESALE
DISCLOSURE CERTIFICATE OR, AS APPLICABLE, AN INFORMATION BULLETIN
UNLESS THE BUYER HAS CLOSED ON THE PURCHASE OF THE MEMBERSHIP
INTEREST WITHIN THE TEN (10) DAY PERIOD. IF THE BUYER ELECTS TO
CANCEL THIS PURCHASE AGREEMENT, PURSUANT TO THIS PROVISION, THE
BUYER MAY DO SO IN WRITING BY HAND DELIVERING THE NOTICE OF
CANCELLATION TO THE SELLER OR SELLER'S AGENT, OR BY MAILING SUCH
NOTICE BY POSTAGE PREPAID, UNITED STATES MAIL, TO THE SELLER OR
THE SELLER'S AGENT WITHIN THE TEN (10) DAY PERIOD. CANCELLATION IS
WITHOUT PENALTY AND ALL PAYMENTS MADE BY THE BUYER HEREUNDER
SHALL BE REFUNDED PROMPTLY."
new text end

Sec. 97.

new text begin [308C.6121] EARNEST MONEY; ESCROW ACCOUNT.
new text end

new text begin Subdivision 1. new text end

new text begin Escrow account required. new text end

new text begin (a) All earnest money paid or deposits made
in connection with the purchase or reservation of a membership from the cooperative or
from a member of the cooperative must be deposited in an escrow account controlled jointly
by the cooperative or the cooperative's management agent and the purchaser, or controlled
by:
new text end

new text begin (1) a licensed title insurer or the title insurer's agent;
new text end

new text begin (2) an attorney representing either the cooperative or the cooperative's managing agent;
new text end

new text begin (3) a licensed real estate broker;
new text end

new text begin (4) an independent bonded escrow company; or
new text end

new text begin (5) a government agency or instrumentality.
new text end

new text begin (b) The escrow account must be in an institution whose deposits are insured by a
government agency or instrumentality.
new text end

new text begin Subd. 2. new text end

new text begin Delivery of money. new text end

new text begin The money or deposits must be held in the escrow account
until:
new text end

new text begin (1) delivered to the cooperative or the cooperative's management agent at closing;
new text end

new text begin (2) delivered to the cooperative or the cooperative's management agent because of the
purchaser's default under a reservation agreement or a contract to purchase the unit;
new text end

new text begin (3) delivered to the purchaser pursuant to the provisions of section 308C.612, subdivision
5, or the provisions of a reservation agreement or a contract to purchase; or
new text end

new text begin (4) delivered for payment of construction costs pursuant to a written agreement between
the cooperative and the purchaser.
new text end

Sec. 98.

Minnesota Statutes 2024, section 308C.613, subdivision 1, is amended to read:

Subdivision 1.

Requirements.

The annual budget of a deleted text begin senior housing deleted text end cooperative formed
under this chapter shall include, without limitation:

(1) the amount included in the budget as a reserve for deleted text begin replacement deleted text end new text begin replacements new text end ;

(2) the amount included in the budget for the general operating reserve;

(3) the amount included in the budget for any other reserves;

(4) the projected common expense for each category of expenditures for the cooperative;
and

(5) the projected monthly common expense assessment for each type of deleted text begin dwelling deleted text end unit.

Sec. 99.

Minnesota Statutes 2024, section 308C.613, subdivision 2, is amended to read:

Subd. 2.

Replacement reserves.

The cooperative shall include in its annual deleted text begin budgets deleted text end new text begin
budget new text end replacement reserves projected by the board to be adequate, together with past and
future contributions thereto to fund the replacement of those components of the cooperative
that the cooperative is obligated to replace by reason of ordinary wear and tear or
obsolescence, subject to the following:

(1) the annual budgets need not include reserves for replacement of components that
have a remaining useful life of more than 30 years, unless required otherwise by the lender
or mortgage insurer relative to deleted text begin the cooperative's master mortgage deleted text end new text begin any blanket mortgage on
the cooperative's project new text end ;

(2) the cooperative shall keep the replacement reserves in an account or accounts separate
from the cooperative's operating funds, and shall not use or borrow from the replacement
reserves to fund the cooperative's operating expenses, except that this restriction shall not
affect the cooperative's authority to pledge the replacement reserves as security for a loan
to the cooperative; and

(3) the cooperative shall reevaluate the adequacy of the cooperative's budgeted
replacement reserves at least every third year after the filing of the cooperative's articles.

Sec. 100.

Minnesota Statutes 2024, section 308C.614, is amended to read:

308C.614 LIEN FOR ASSESSMENTS.

(a) A deleted text begin senior housing deleted text end cooperative formed under this chapter has a lien on a membership
interest, the appurtenant deleted text begin occupancy agreement deleted text end new text begin proprietary lease new text end , and the member's associated
occupancy rights for any assessment levied against that membership interest from the time
the assessment becomes due. If an assessment is payable in installments, the full amount
of the assessment is a lien from the time the first installment thereof becomes due. Unless
the bylaws provide otherwise, any fees, charges, or payments that members must regularly
pay to the cooperative are enforceable as assessments under this section. deleted text begin Other cooperatives
formed under this chapter may authorize a lien on a membership interest, occupancy
agreement, or a proprietary lease in the bylaws.
deleted text end

(b) A lien under this section is prior to all other liens and encumbrances on a membership
certificate except (i) liens, encumbrances, or mortgages which the cooperative creates,
assumes, or takes subject to, or (ii) any first security interest encumbering only the
membership interest. If a first security interest encumbering a membership interest which
is personal property is foreclosed, the secured party or the purchaser at the sale shall take
title to the membership interest subject to unpaid assessments. This paragraph shall not
affect the priority of mechanics' liens encumbering the project.

(c) Proceedings to enforce an assessment lien shall be instituted within three years after
the last installment of the assessment becomes payable, or shall be barred.

(d) The member and owner of the membership interest, at the time an assessment is due,
shall be personally liable to the cooperative for payment of the assessment levied against
the membership interest. If there are multiple owners of the membership interest, they shall
be jointly and severally liable.

(e) This section does not prohibit actions to recover sums for which paragraph (a) creates
a lien nor prohibit a cooperative from taking an assignment of the membership certificate
and deleted text begin occupancy agreement deleted text end new text begin proprietary lease new text end or other conveyance documents agreed upon
by the parties in lieu of foreclosure.

(f) The cooperative shall furnish to a member or the member's authorized agent upon
written request of the member or the authorized agent a statement setting forth the amount
of unpaid assessments currently levied against the member's interest. The statement shall
be furnished within ten business days after receipt of the request and is binding on the
cooperative and every member.

Sec. 101.

Minnesota Statutes 2024, section 308C.615, is amended to read:

308C.615 FORECLOSURE OF LIENS deleted text begin OR TO ACQUIRE OCCUPANCY RIGHTS
FOLLOWING MEMBERSHIP TERMINATION IN A SENIOR HOUSING
COOPERATIVE deleted text end .

(a) A deleted text begin senior housing deleted text end cooperative's lien shall be foreclosed by a private sale negotiated
by the cooperative, or by an acceptance by the cooperative of the subject membership interest
in full satisfaction of the secured indebtedness pursuant to the following:

(1) a notice of the sale or acceptance shall be served on the member 90 days prior to the
sale or acceptance;

new text begin (2) if the member was not previously provided notice and an opportunity to request a
hearing before the board pursuant to section 308C.501, the notice of sale or acceptance
must, in addition to the statement required under clause (5), include the notice, or the
cooperative must issue a separate written notice to the member providing an opportunity to
be heard before the board pursuant to section 308C.501;
new text end

deleted text begin (2) deleted text end new text begin (3) new text end the cooperative shall be entitled to its reasonable costs and attorney fees not
exceeding the amount provided by section 582.01, subdivision 1a;

deleted text begin (3) deleted text end new text begin (4) new text end the amount of the cooperative's lien shall be deemed to be adequate consideration
for the membership interest subject to sale or acceptance, notwithstanding the value of the
membership interest; and

deleted text begin (4) deleted text end new text begin (5) new text end the notice of sale or acceptance shall contain the following statement in capital
letters with the name of the cooperative or secured party filled in:

"THIS IS TO INFORM YOU THAT BY THIS NOTICE (fill in name of cooperative
or secured party) HAS BEGUN PROCEEDINGS UNDER MINNESOTA STATUTES,
CHAPTER 308C, TO FORECLOSE ON YOUR MEMBERSHIP INTEREST FOR THE
REASON SPECIFIED IN THIS NOTICE. YOUR MEMBERSHIP INTEREST AND
YOUR RIGHT TO OCCUPY THE deleted text begin DWELLING deleted text end UNIT APPURTENANT THERETO
WILL TERMINATE 90 DAYS AFTER SERVICE OF THIS NOTICE ON YOU UNLESS
BEFORE THEN:

(a) THE PERSON AUTHORIZED BY (fill in the name of cooperative or secured party)
AND DESCRIBED IN THIS NOTICE TO RECEIVE PAYMENTS RECEIVES FROM
YOU:

(1) THE AMOUNT THIS NOTICE SAYS YOU OWE; PLUS

(2) THE COSTS INCURRED TO SERVE THIS NOTICE ON YOU; PLUS

(3) $500 TO APPLY TO ATTORNEY FEES ACTUALLY EXPENDED OR
INCURRED; PLUS

(4) ANY ADDITIONAL AMOUNTS FOR YOUR MEMBERSHIP INTEREST
BECOMING DUE TO (fill in name of cooperative or secured party) AFTER THE DATE
OF THIS NOTICE; OR

(b) YOU SECURE FROM A DISTRICT COURT AN ORDER THAT THE
FORECLOSURE OF YOUR RIGHTS TO YOUR MEMBERSHIP INTEREST AND
YOUR RIGHT TO OCCUPY THE deleted text begin DWELLING deleted text end UNIT APPURTENANT THERETO BE
SUSPENDED UNTIL YOUR CLAIMS OR DEFENSES ARE FINALLY DISPOSED OF
BY TRIAL, HEARING, OR SETTLEMENT. YOUR ACTION MUST SPECIFICALLY
STATE THOSE FACTS AND GROUNDS THAT DEMONSTRATE YOUR CLAIMS
OR DEFENSES. IF YOU DO NOT TAKE ACTION AS PRESCRIBED IN PARAGRAPH
(A) OF THIS NOTICE WITHIN THE TIME PERIOD SPECIFIED IN THIS NOTICE,
YOUR OWNERSHIP RIGHTS IN YOUR MEMBERSHIP INTEREST AND YOUR
RIGHT TO OCCUPY THE deleted text begin DWELLING deleted text end UNIT APPURTENANT THERETO WILL
TERMINATE AT THE END OF THE PERIOD, YOU WILL LOSE ALL THE MONEY
YOU HAVE PAID FOR YOUR MEMBERSHIP INTEREST, YOU WILL LOSE YOUR
RIGHT TO POSSESSION AND OCCUPANCY OF YOUR deleted text begin DWELLING deleted text end UNIT, YOU
MAY LOSE YOUR RIGHT TO ASSERT ANY CLAIMS OR DEFENSES THAT YOU
MIGHT HAVE, AND YOU WILL BE EVICTED. IF YOU HAVE ANY QUESTIONS
ABOUT THIS NOTICE, CONTACT AN ATTORNEY IMMEDIATELY."

(b) If the member or occupant fails to redeem before the expiration of 90 days following
delivery of the notice to the member, the cooperative may bring an action for eviction against
the member and any persons occupying the deleted text begin dwelling deleted text end unit, and in that case section 504B.291
shall not apply.

(c) A cooperative may assign its lien rights in the same manner as any other secured
party.

Sec. 102.

Minnesota Statutes 2024, section 308C.625, subdivision 1, is amended to read:

Subdivision 1.

How imposed.

A restriction on the transfer or registration deleted text begin of transfer deleted text end of
membership interests of a cooperative deleted text begin may deleted text end new text begin shall new text end be imposed in the articles deleted text begin , in the deleted text end new text begin or new text end bylaws deleted text begin ,
by a resolution adopted by the members, or by an agreement among or other written action
by a number of members or holders of other membership interests or among them and the
cooperative. A restriction is not binding with respect to membership interests issued prior
to the adoption of the restriction, unless the holders of those membership interests are parties
to the agreement or voted in favor of the restriction deleted text end .

Sec. 103.

Minnesota Statutes 2024, section 308C.625, subdivision 2, is amended to read:

Subd. 2.

Restrictions permitted.

A written restriction on the transfer or registration deleted text begin of
transfer deleted text end of membership interests of a cooperative that is not manifestly unreasonable under
the circumstances may be enforced against the holder of the restricted membership interests
or a successor or transferee of the holder, including a pledgee or a legal representative, if
the restriction is either:

(1) noted conspicuously on the face or back of the certificate;

(2) included in this chapter or the articles or bylaws; or

(3) included in information sent to the holders of uncertificated membership interests.

Unless a restriction is in this chapter, the articles, bylaws, noted conspicuously on the
face or back of the certificate deleted text begin , or included in information sent to the holders of uncertificated
membership interests, deleted text end a restriction, even though permitted by this section, is ineffective
against a person without knowledge of the restriction. A restriction under this section is
deemed to be noted conspicuously and is effective if the existence of the restriction is stated
on the certificate and reference is made to a separate document creating or describing the
restriction.

Sec. 104.

new text begin [308C.630] EXPRESS WARRANTIES.
new text end

new text begin (a) Express warranties made by a developer to the purchaser of a membership, if
reasonably relied upon by the purchaser, are created under this section.
new text end

new text begin (b) An affirmation of fact or promise that relates to the unit to which the purchased
membership is appurtenant, use of the unit, rights appurtenant to the unit, improvements to
the project that would directly benefit the purchaser or the unit, or the right to use or have
the benefit of facilities that are not a part of the project creates an express warranty that the
unit and related rights and uses will conform to the affirmation or promise.
new text end

new text begin (c) A model or description of the physical characteristics of a unit or the project, including
plans and specifications of or for a unit or other improvements located in the project, creates
an express warranty that the unit and the project will conform to the model or description.
A notice prominently displayed on a model or included in a description shall prevent a
purchaser from reasonably relying upon the model or description to the extent of the
disclaimer set forth in the notice.
new text end

new text begin (d) A description of the quantity or extent of the real estate comprising the project,
including plats or surveys, creates an express warranty that the project will conform to the
description, subject to customary tolerances.
new text end

new text begin (e) The form of the word "warranty" or "guaranty," or a specific intention to make a
warranty, is not necessary to create an express warranty of quality, but a statement purporting
to be merely an opinion or commendation of the real estate or the value of the real estate
does not create a warranty.
new text end

new text begin (f) A conveyance of a membership to which a unit is appurtenant transfers all express
warranties to the purchaser.
new text end

Sec. 105.

new text begin [308C.631] IMPLIED WARRANTIES.
new text end

new text begin (a) A developer warrants to a purchaser that a unit will be in at least as good condition
at the earlier of the time of the conveyance or delivery of possession as the unit was at the
time of contracting with reasonable wear and tear excepted.
new text end

new text begin (b) A developer warrants to a purchaser that:
new text end

new text begin (1) a unit and the common elements in the project are suitable for the ordinary uses of
real estate of the unit's type; and
new text end

new text begin (2) any improvements subject to use rights by the purchaser or made or contracted for
by the developer or made by a person in contemplation of the creation of the cooperative's
building or project are:
new text end

new text begin (i) free from defective materials; and
new text end

new text begin (ii) constructed in accordance with applicable law, according to sound engineering and
construction standards, and in a workmanlike manner.
new text end

new text begin (c) A developer warrants to a purchaser of a membership to which a unit is appurtenant
and available for residential use that the residential use will not violate applicable law at
the earlier of the time of conveyance or delivery of possession.
new text end

new text begin (d) Warranties imposed by this section may be excluded or modified only as specified
in section 308C.632.
new text end

new text begin (e) For purposes of this section, improvements made or contracted for by an affiliate of
a developer are made or contracted for by the developer.
new text end

new text begin (f) A conveyance of a membership to which a unit is appurtenant transfers all implied
warranties to the purchaser.
new text end

new text begin (g) This section does not in any manner abrogate the provisions of chapter 327A relating
to statutory warranties for housing or affect any other cause of action under a statute or
common law.
new text end

Sec. 106.

new text begin [308C.632] EXCLUSION OR CHANGE OF IMPLIED WARRANTIES.
new text end

new text begin (a) When a unit is available for residential use, no general disclaimer of implied warranties
is effective, but a developer may disclaim liability in an instrument separate from the purchase
agreement signed by the purchaser for a specified defect or specified failure to comply with
applicable law if the defect or failure entered into and became a part of the basis of the
bargain.
new text end

new text begin (b) With respect to a unit restricted to nonresidential use, implied warranties:
new text end

new text begin (1) may be excluded or modified by agreement of the parties; and
new text end

new text begin (2) are excluded by expression of disclaimer, including "as is," "with all faults," or other
language that in common understanding calls the purchaser's attention to the exclusion of
warranties.
new text end

Sec. 107.

new text begin [308C.633] STATUTE OF LIMITATIONS; BREACH; WARRANTIES.
new text end

new text begin (a) A judicial proceeding for breach of an obligation arising under section 308C.612
shall be commenced within 12 months after execution of a proprietary lease that conveys
the right of occupancy in the unit.
new text end

new text begin (b) A judicial proceeding for breach of an obligation arising under section 308C.630 or
308C.631 must be commenced within six years after the cause of action accrues, but the
parties may agree to reduce the period of limitation to no less than two years. An agreement
reducing the period of limitation signed by one purchaser of a membership to which a unit
is appurtenant is binding on any copurchasers of the membership. If an agreement reducing
the period of limitations is recorded in compliance with applicable law, the agreement is
binding on the purchaser's and copurchaser's successors in title to the membership interest.
With respect to a unit that may be occupied for residential use, an agreement to reduce the
period of limitation must be evidenced by an instrument separate from the purchase
agreement signed by the purchaser of the membership to which the unit is appurtenant.
new text end

new text begin (c) A cause of action under section 308C.630 or 308C.631, regardless of the purchaser's
lack of knowledge of the breach, accrues:
new text end

new text begin (1) as to the unit, at the earlier of:
new text end

new text begin (i) the time of execution of a proprietary lease which conveys the right of occupancy in
the unit by the developer or cooperative to a bona fide purchaser; or
new text end

new text begin (ii) the time a purchaser enters into possession of the unit; and
new text end

new text begin (2) as to each common element, the latest of:
new text end

new text begin (i) the time the common element is completed; or
new text end

new text begin (ii) the time the first membership interest appurtenant to a unit in the cooperative's project
is conveyed to a member with the unit's appurtenant right of occupancy.
new text end

Sec. 108.

Minnesota Statutes 2024, section 308C.801, as amended by Laws 2025, chapter
20, section 245, is amended to read:

308C.801 MERGER AND CONSOLIDATION.

Subdivision 1.

Authorization.

Unless otherwise prohibited, cooperatives organized
under deleted text begin the laws of this state, including cooperatives organized under deleted text end this chapter deleted text begin or chapter
308A or 308B, deleted text end may merge or consolidate with each other deleted text begin , a Minnesota limited liability
company under the provisions of sections 322C.1001 to 322C.1015, or other business entities
organized under the laws of another state by complying with the provisions of this section
and the law of the state where the surviving or new business entity will exist. A cooperative
may not merge or consolidate with a business entity organized under the laws of this state,
other than a cooperative organized under chapter 308A or 308B, unless the law governing
the business entity expressly authorizes merger or consolidation with a cooperative deleted text end .

Subd. 2.

Plan.

To initiate a merger or consolidation of a cooperative, a written plan of
merger or consolidation shall be prepared by the board or by a committee selected by the
board to prepare a plan. The plan shall state:

(1) the names of the deleted text begin constituent domestic deleted text end cooperatives deleted text begin , the name of any Minnesota
limited liability company deleted text end that deleted text begin is deleted text end new text begin are new text end a party to the merger deleted text begin , to the extent authorized under
sections 322C.1001 to 322C.1005 and 322C.1015, and any foreign business entities deleted text end ;

(2) the name of the surviving or new deleted text begin domestic deleted text end cooperative deleted text begin , Minnesota limited liability
company as required by section 322C.1002, or other foreign business entity deleted text end ;

(3) the manner and basis of converting membership deleted text begin or ownership deleted text end interests of the
constituent deleted text begin domestic deleted text end cooperatives deleted text begin , the surviving Minnesota limited liability company as
provided in section 322C.1002, or foreign business entities deleted text end into membership deleted text begin or ownership deleted text end
interests in the surviving or new deleted text begin domestic deleted text end cooperative deleted text begin , the surviving Minnesota limited
liability company as authorized in section 322C.1002, or foreign business entity deleted text end ;

(4) the terms of the merger or consolidation;

(5) the proposed effect of the consolidation or merger on the deleted text begin members and occupant deleted text end
members of each constituent deleted text begin domestic deleted text end cooperative; and

(6) for a consolidation, the plan shall contain the articles of deleted text begin the entity or organizational
documents to be filed with the state in which the entity is organized or, if deleted text end the surviving
deleted text begin organization is a Minnesota limited liability company, the articles of organization deleted text end new text begin entity new text end .

Subd. 3.

Notice.

deleted text begin The following shall apply to notice:
deleted text end

deleted text begin (1) deleted text end The board shall mail or otherwise transmit or deliver notice of the merger or
consolidation to each member. The notice shall contain the full text of the plan, and the
time and place of the meeting at which the plan will be considered deleted text begin ; and deleted text end new text begin .
new text end

deleted text begin (2) a cooperative with more than 200 members deleted text end new text begin The board new text end may provide the notice in the
same manner as a regular members' meeting notice.

Subd. 4.

Adoption of plan.

(a) A plan of merger or consolidation shall be adopted by
a deleted text begin domestic deleted text end cooperative as provided in this subdivision.

(b) A plan of merger or consolidation is adopted if:

(1) a quorum of the members eligible to vote is registered as being present or represented
by mail vote or alternative ballot at the meeting; and

(2) the plan is approved by deleted text begin the occupant members, or if otherwise provided in the articles
or bylaws is approved by a majority of the votes cast in each class of votes cast, deleted text end new text begin two-thirds
of all outstanding memberships of record, new text end or for a deleted text begin domestic deleted text end cooperative with articles or
bylaws requiring deleted text begin more than a majority deleted text end new text begin a greater proportion new text end of the votes cast or other
conditions for approval, the plan is approved by a proportion of the votes cast or a number
of total members as required by the articles or bylaws and the conditions for approval in
the articles or bylaws have been satisfied.

(c) After the plan has been adopted, articles of merger or consolidation stating the plan
and that the plan was adopted according to this subdivision shall be signed by the deleted text begin chair,
vice chair, records officer, or documents officer deleted text end new text begin president and secretary new text end of each cooperative
merging or consolidating.

(d) The articles of merger or consolidation shall be filed in the Office of the Secretary
of State.

(e) For a merger, the articles of the surviving deleted text begin domestic deleted text end cooperative subject to this chapter
are deemed amended to the extent provided in the articles of merger.

(f) Unless a later date is provided in the plan, the merger or consolidation is effective
when the articles of merger or consolidation are filed in the Office of the Secretary of State
deleted text begin or the appropriate office of another jurisdiction deleted text end .

(g) The secretary of state shall issue a certificate of organization of the merged or
consolidated cooperative.

Subd. 5.

Effect of merger.

deleted text begin For a merger that does not involve a Minnesota limited
liability company, the following shall apply to the effect of a merger:
deleted text end

deleted text begin (a) After the effective date, the domestic cooperative, Minnesota limited liability
company, if party to the plan, and any foreign business entity that is a party to the plan
become a single entity. For a merger, the surviving business entity is the business entity
designated in the plan. For a consolidation, the new domestic cooperative, the Minnesota
limited liability company, if any, and any foreign business entity is the business entity
provided for in the plan. Except for the surviving or new domestic cooperative, Minnesota
limited liability company, or foreign business entity, the separate existence of each merged
or consolidated domestic or foreign business entity that is a party to the plan ceases on the
effective date of the merger or consolidation.
deleted text end

deleted text begin (b) deleted text end The surviving or new deleted text begin domestic deleted text end cooperative deleted text begin , Minnesota limited liability company,
or foreign business entity deleted text end possesses all of the rights and property of each of the merged or
consolidated business entities and is responsible for all their obligations. The title to property
of the merged or consolidated deleted text begin domestic deleted text end cooperative deleted text begin or foreign business deleted text end entity is vested in
the surviving or new deleted text begin domestic deleted text end cooperative deleted text begin , Minnesota limited liability company, or foreign
business entity deleted text end without reversion or impairment of the title caused by the merger or
consolidation.

deleted text begin (c) If a merger involves a Minnesota limited liability company, this subdivision is subject
to the provisions of section 322C.1002.
deleted text end

Sec. 109.

Minnesota Statutes 2024, section 308C.835, is amended to read:

308C.835 ABANDONMENT.

Subdivision 1.

Abandonment by members before plan effective date.

After a plan of
merger has been approved by the members deleted text begin entitled to vote on the approval of the plan deleted text end and
before the effective date of the plan, the plan may be abandoned by the same vote that
approved the plan.

Subd. 2.

deleted text begin Generally deleted text end new text begin Abandonment after plan of merger filed but before plan of
merger effective date new text end .

deleted text begin (a) A merger may be abandoned:
deleted text end

deleted text begin (1) if the members of each of the constituent domestic cooperatives entitled to vote on
the approval of the plan have approved the abandonment at a meeting by the affirmative
vote of the holders of a majority of the voting power of the membership interests entitled
to vote; if the merger is with a domestic cooperative and a Minnesota limited liability
company or foreign business entity, if abandonment is approved in such manner as may be
required by section 322C.1003 for the involvement of a Minnesota limited liability company,
or for a foreign business entity by the laws of the state under which the foreign business
entity is organized; and the members of a constituent domestic cooperative are not entitled
to vote on the approval of the plan, the board of the constituent domestic cooperative has
approved the abandonment by the affirmative vote of a majority of the directors present;
deleted text end

deleted text begin (2) if the plan itself provides for abandonment and all conditions for abandonment set
forth in the plan are met; or
deleted text end

deleted text begin (3) under paragraph (b).
deleted text end

deleted text begin (b) A plan of merger may be abandoned before the effective date of the plan by a
resolution of the board of any constituent domestic cooperative abandoning the plan of
merger approved by the affirmative vote of a majority of the directors present, subject to
the contract rights of any other person under the plan. If a plan of merger is with a domestic
or foreign business entity, the plan of merger may be abandoned before the effective date
of the plan by a resolution of the foreign business entity adopted according to the laws of
the state under which the foreign business entity is organized, subject to the contract rights
of any other person under the plan. If the plan of merger is with a Minnesota limited liability
company, the plan of merger may be abandoned by the Minnesota limited liability company
as provided in section 322C.1003, subject to the contractual rights of any other person under
the plan.
deleted text end

deleted text begin (c) deleted text end If articles of merger have been filed with the secretary of state, but have not yet
become effective, the constituent deleted text begin organizations, in the case of abandonment under paragraph
(a), clause (1), the constituent organizations or any one of them, in the case of abandonment
under paragraph (a), clause (2), or the abandoning organization in the case of abandonment
under paragraph (b), deleted text end new text begin cooperatives new text end shall file with the secretary of state articles of abandonment
that contain:

(1) the names of the constituent deleted text begin organizations deleted text end new text begin cooperatives new text end ; new text begin and
new text end

deleted text begin (2) the provisions of this section under which the plan is abandoned; and
deleted text end

deleted text begin (3) if the plan is abandoned under paragraph (b), deleted text end new text begin (2) new text end the text of the resolution abandoning
the plan.

Sec. 110.

Minnesota Statutes 2024, section 308C.902, subdivision 2, is amended to read:

Subd. 2.

Approval.

The proposed dissolution must be submitted for approval at deleted text begin the deleted text end new text begin a new text end
member meeting. The dissolution must be started if a quorum is present and the proposed
dissolution is approved at a meeting by the affirmative vote of two-thirds of the entire
membership of record, or for a cooperative with articles or bylaws requiring a greater
proportion of the votes cast or other conditions for approval, the dissolution is approved by
the proportion of votes cast or the number of total members required by the articles or
bylaws, and if the conditions for approval in the articles or bylaws are satisfied.

Sec. 111.

new text begin [308C.9031] BUSINESS AFTER DISSOLUTION BEGINS.
new text end

new text begin After the notice of intent to dissolve has been filed with the Office of the Secretary of
State, the cooperative may carry on the business only to the extent necessary for winding
up the cooperative unless the members revoke the dissolution proceedings. The existence
of the cooperative continues to the extent necessary to wind up the affairs of the cooperative
until the dissolution proceedings are revoked or articles of dissolution are filed with the
Office of the Secretary of State.
new text end

Sec. 112.

new text begin [308C.9032] REMEDIES CONTINUED.
new text end

new text begin The filing with the Office of the Secretary of State of notice of intent to dissolve does
not affect a remedy in favor of the cooperative or a remedy against the cooperative or the
cooperative's directors, officers, or members in their capacities, except as provided in section
308C.975.
new text end

Sec. 113.

Minnesota Statutes 2024, section 308C.905, subdivision 1, is amended to read:

Subdivision 1.

Collection and payment of debts.

After the notice of intent to dissolve
has been filed with the secretary of state, the board, or the officers acting under the direction
of the board, shall proceed as soon as possible:

(1) to collect or make provision for the collection of all debts due or owing to the
cooperative, including unpaid deleted text begin subscriptions for shares deleted text end new text begin assessments or unpaid downpayments
for the purchase of a membership interest new text end ; and

(2) to pay or make provision for the payment of all debts, obligations, and liabilities of
the cooperative according to their priorities.

Sec. 114.

Minnesota Statutes 2024, section 308C.925, is amended to read:

308C.925 APPLICATION FOR COURT-SUPERVISED VOLUNTARY
DISSOLUTION.

After a notice of intent to dissolve has been filed with the secretary of state and before
a certificate of dissolution has been issued, the cooperative or, for good cause shown, a
member or creditor may apply to a court within the county where the registered office is
located to have the dissolution conducted or continued under the supervision of the courts new text begin
as provided in section 308C.935 new text end .

Sec. 115.

Minnesota Statutes 2024, section 308C.935, subdivision 2, is amended to read:

Subd. 2.

Action after hearing.

After a hearing is completed, upon notice to parties to
the proceedings and to other parties in interest designated by the court, the court may appoint
a receiver to collect the cooperative's assets, including amounts owing to the cooperative
by deleted text begin subscribers on account of an unpaid portion of the consideration for the issuance of
shares. deleted text end new text begin :
new text end

new text begin (1) third parties;
new text end

new text begin (2) members, including but not limited to unpaid assessments; and
new text end

new text begin (3) subscribers or purchasers on account of unpaid portions of the consideration for the
issuance of a membership interest.
new text end

In addition to the powers set forth in chapter 576, a receiver has authority, subject to the
order of the court, to continue the business of the cooperative and to sell, lease, transfer, or
otherwise dispose of the property and assets of the cooperative either at public or private
sale.

Sec. 116.

Minnesota Statutes 2024, section 308C.941, subdivision 2, is amended to read:

Subd. 2.

Powers.

A receiver may sue and defend all actions as receiver of the cooperative. new text begin
The court appointing the receiver has exclusive jurisdiction over the cooperative, the receiver,
and all receivership property under section 576.23.
new text end

Sec. 117.

Minnesota Statutes 2024, section 515B.1-102, is amended to read:

515B.1-102 APPLICABILITY.

(a) Except as provided in this section, this chapter, and not chapters 515 and 515A,
applies to all common interest communities created within this state on and after June 1,
1994.

(b) The applicability of this chapter to common interest communities created prior to
June 1, 1994, shall be as follows:

(1) This chapter shall apply to condominiums created under chapter 515A with respect
to events and circumstances occurring on and after June 1, 1994; provided (i) that this
chapter shall not invalidate the declarations, bylaws or condominium plats of those
condominiums, and (ii) that chapter 515A, and not this chapter, shall govern all rights and
obligations of a declarant of a condominium created under chapter 515A, and the rights and
claims of unit owners against that declarant.

(2) The following sections in this chapter apply to condominiums created under chapter
515: 515B.1-104 (Variation by Agreement); 515B.1-105 (Separate Titles and Taxation);
515B.1-106 (Applicability of Local Requirements); 515B.1-107 (Eminent Domain);
515B.1-108 (This Chapter Prevails; Supplemental Law); 515B.1-109 (Construction Against
Implicit Repeal); 515B.1-112 (Unconscionable Agreement or Term of Contract); 515B.1-113
(Obligation of Good Faith); 515B.1-114 (Remedies to be Liberally Administered);
515B.1-115 (Notice); 515B.1-116 (Recording); 515B.2-103 (Construction and Validity of
Declaration and Bylaws); 515B.2-104 (Description of Units); 515B.2-108 (d) (Allocation
of Interests); 515B.2-109 (f) (Common Elements and Limited Common Elements);
515B.2-112 (Subdivision, Combination, or Conversion of Units); 515B.2-113 (Alteration
of Units); 515B.2-114 (Relocation of Boundaries Between Adjoining Units); 515B.2-115
(Minor Variations in Boundaries); 515B.2-118 (Amendment of Declaration); 515B.2-119
(Termination of Common Interest Community); 515B.3-102 (Powers of Unit Owners'
Association); 515B.3-103 (a), (b), and (g) (Board of Directors, Officers, and Declarant
Control); 515B.3-107 (Upkeep of Common Interest Community); 515B.3-108 (Meetings);
515B.3-109 (Quorums); 515B.3-110 (Voting; Proxies); 515B.3-111 (Tort and Contract
Liability); 515B.3-112 (Conveyance of, or Creation of Security Interests in, Common
Elements); 515B.3-113 (Insurance); 515B.3-114 (Replacement Reserves); 515B.3-115 (c),
(e), (f), (g), (h), and (i) (Assessments for Common Expenses); 515B.3-116 (Lien for
Assessments); 515B.3-117 (Other Liens); 515B.3-118 (Association Records); 515B.3-119
(Association as Trustee); 515B.3-121 (Accounting Controls); 515B.4-107 (Resale of Units);
515B.4-108 (Purchaser's Right to Cancel Resale); and 515B.4-116 (Rights of Action;
Attorney's Fees). Section 515B.1-103 (Definitions) shall apply to the extent necessary in
construing any of the sections referenced in this section. Sections 515B.1-105, 515B.1-106,
515B.1-107, 515B.1-116, 515B.2-103, 515B.2-104, 515B.2-118, 515B.3-102, 515B.3-110,
515B.3-111, 515B.3-113, 515B.3-116, 515B.3-117, 515B.3-118, 515B.3-121, 515B.4-107,
515B.4-108, and 515B.4-116 apply only with respect to events and circumstances occurring
on and after June 1, 1994. All other sections referenced in this section apply only with
respect to events and circumstances occurring after July 31, 1999. A section referenced in
this section does not invalidate the declarations, bylaws or condominium plats of
condominiums created before August 1, 1999. But all sections referenced in this section
prevail over the declarations, bylaws, CIC plats, rules and regulations under them, of
condominiums created before August 1, 1999, except to the extent that this chapter defers
to the declarations, bylaws, CIC plats, or rules and regulations issued under them.

(3) This chapter shall not apply to cooperatives and planned communities created prior
to June 1, 1994, or to planned communities that were created on or after June 1, 1994, and
before August 1, 2006, and that consist of more than two but fewer than 13 units; except
by election pursuant to subsection (d), and except that sections 515B.1-116, subsections
(a), (c), (d), and (e), 515B.4-107, and 515B.4-108, apply to all planned communities and
cooperatives regardless of when they are created, unless they are exempt under subsection
(e).

(c) This chapter shall not invalidate any amendment to the declaration, bylaws or
condominium plat of any condominium created under chapter 515 or 515A if the amendment
was recorded before June 1, 1994. Any amendment recorded on or after June 1, 1994, shall
be adopted in conformity with the procedures and requirements specified by those instruments
and by this chapter. If the amendment grants to any person any rights, powers or privileges
permitted by this chapter, all correlative obligations, liabilities and restrictions contained
in this chapter shall also apply to that person.

(d) Any condominium created under chapter 515, any planned community or cooperative
which would be exempt from this chapter under subsection (e), or any planned community
or cooperative created prior to June 1, 1994, or any planned community that was created
on or after June 1, 1994, and prior to August 1, 2006, and that consists of more than two
but fewer than 13 units, may elect to be subject to this chapter, as follows:

(1) The election shall be accomplished by recording a declaration or amended declaration,
and a new or amended CIC plat where required, and by approving bylaws or amended
bylaws, which conform to the requirements of this chapter, and which, in the case of
amendments, are adopted in conformity with the procedures and requirements specified by
the existing declaration and bylaws of the common interest community, and by any applicable
statutes.

(2) In a condominium, the preexisting condominium plat shall be the CIC plat and an
amended CIC plat shall be required only if the amended declaration or bylaws contain
provisions inconsistent with the preexisting condominium plat. The condominium's CIC
number shall be the apartment ownership number or condominium number originally
assigned to it by the recording officer. In a cooperative in which the unit owners' interests
are characterized as real estate, a CIC plat shall be required. In a planned community, the
preexisting plat or registered land survey recorded pursuant to chapter 505, 508, or 508A,
or the part of the plat or registered land survey upon which the common interest community
is located, shall be the CIC plat.

(3) The amendment shall comply with section 515B.2-118(a)(3) and (c); except that the
unanimous consent of the unit owners shall not be required for (i) a clarification of the unit
boundary description if the clarified boundary description is substantially consistent with
the preexisting CIC plat, or (ii) changes from common elements to limited common elements
that occur by operation of section 515B.2-109(c) and (d).

(4) Except as permitted by paragraph (3), no declarant, affiliate of declarant, association,
master association nor unit owner may acquire, increase, waive, reduce or revoke any
previously existing warranty rights or causes of action that one of said persons has against
any other of said persons by reason of exercising the right of election under this subsection.

(5) A common interest community which elects to be subject to this chapter may, as a
part of the election process, change its form of ownership by complying with section
515B.2-123.

(e) Except as otherwise provided in this subsection, this chapter shall not apply, except
by election pursuant to subsection (d), to the following:

(1) a planned community which consists of two units, which utilizes a CIC plat complying
with section 515B.2-110(d)(1) and (2), or section 515B.2-1101(d)(1) and (2), which is not
subject to any rights to subdivide or convert units or to add additional real estate, and which
is not subject to a master association;

(2) a common interest community that consists solely of platted lots or other separate
parcels of real estate designed or utilized for detached single family dwellings or agricultural
purposes, with or without common property, where no association or master association
has an obligation to maintain any building containing a dwelling or any agricultural building
located or to be located on such platted lots or parcels; except that section 515B.4-101(e)
shall apply to the sale of such platted lots or parcels of real estate if the common interest
community is or will be subject to a master declaration;

(3) a cooperative where, at the time of creation of the cooperative, the unit owners'
interests in the dwellings as described in the declaration consist solely of proprietary leases
having an unexpired term of fewer than 20 years, including renewal options;

(4) planned communities utilizing a CIC plat complying with section 515B.2-110(d)(1)
and (2), or section 515B.2-1101(d)(1) and (2), and cooperatives, which are limited by the
declaration to nonresidential uses; or

(5) real estate subject only to an instrument or instruments filed primarily for the purpose
of creating or modifying rights with respect to access, utilities, parking, ditches, drainage,
or irrigation.

(f) Section 515B.4-101(e) applies to any platted lot or other parcel of real estate that is
subject to a master declaration and is not subject to or is exempt from this chapter.

(g) Section 515B.1-106and section 515B.2-118, subsections (a)(5), (a)(7), and (d), shall
apply to all common interest communities.

(h) Sections 515B.1-103(33a), 515B.2-110, 515B.3-105, 515B.3-115, 515B.4-102, and
515B.4-115 apply only to common interest communities created before August 1, 2010.
Sections 515B.1-103 (33b), 515B.2-1101, 515B.3-1051, 515B.3-1151, 515B.4-1021, and
515B.4-1151 apply only to common interest communities created on or after August 1,
2010.

(i) Section 515B.3-114 applies to common interest communities only for the association's
fiscal years commencing before January 1, 2012. Section 515B.3-1141 applies to common
interest communities only for the association's fiscal years commencing on or after January
1, 2012.

(j) Section 515B.3-104 applies only to transfers of special declarant rights that are
effective before August 1, 2010. Section 515B.3-1041, subsections (a) through (i), apply
only to transfers of special declarant rights that are effective on or after August 1, 2010.
Section 515B.3-1041, subsections (j) and (k), apply only to special declarant rights reserved
in a declaration that is first recorded on or after August 1, 2010.

new text begin (k) This chapter does not apply to cooperatives organized under chapter 308C.
new text end

Sec. 118.

Minnesota Statutes 2025 Supplement, section 515B.3-101, is amended to read:

515B.3-101 ORGANIZATION OF UNIT OWNERS' ASSOCIATION.

A common interest community shall be administered by an association. The association
shall be incorporated no later than the date the common interest community is created. The
membership of the association at all times consists exclusively of all unit owners or, following
termination of the common interest community, of all former unit owners entitled to
distributions of proceeds under section 515B.2-119 or their heirs, successors, or assigns.
The association shall be organized as a Minnesota profit or nonprofit corporation, or may,
in the case of a cooperative, be organized under chapter deleted text begin 308A, deleted text end 308B deleted text begin , or 308C deleted text end . In the event
of a conflict between this chapter and any other chapter under which the association is
incorporated, this chapter shall control.

Sec. 119.

Minnesota Statutes 2025 Supplement, section 515B.3-103, is amended to read:

515B.3-103 BOARD OF DIRECTORS, OFFICERS AND DECLARANT
CONTROL.

(a) An association shall be governed by a board of directors whose appointment or
election shall occur no later than the date of creation of the common interest community
and shall be reflected in the association's records. Except as expressly prohibited by the
declaration, the articles of incorporation, bylaws, subsection (b), or other provisions of this
chapter, the board may act in all instances on behalf of the association. In the performance
of their duties, the officers and directors are required to exercise (i) if appointed by the
declarant, the care required of fiduciaries of the unit owners and (ii) if elected by the unit
owners, the care required of a director by section 302A.251, 308B.455, deleted text begin 308C.455, deleted text end or
317A.251, as applicable. The officers and directors appointed by the declarant shall have
a duty to fulfill, and to cause the association to fulfill, their respective obligations under the
declaration, bylaws, articles of incorporation, and this chapter and to enforce the provisions
of the declaration, bylaws, articles of incorporation, and this chapter against all unit owners,
including the declarant and its affiliates, in a uniform and fair manner. The standards of
conduct for officers and directors set forth in this subsection shall also apply to the officers
and directors of master associations in the exercise of their duties on behalf of the master
association.

(b) The board may not act unilaterally to amend the declaration, to terminate the common
interest community, to elect directors to the board, or to determine the qualifications, powers
and duties, or terms of office of directors, but the board may fill vacancies in its membership
created other than by removal by the vote of the association members for the unexpired
portion of any term.

(c) The declaration may provide for a period of declarant control of the association,
during which a declarant, or persons designated by the declarant, may appoint and remove
the officers and directors of the association. The period of declarant control begins on the
date of creation of the common interest community and terminates upon the earliest of the
following events: (i) five years after the date of the first conveyance of a unit to a unit owner
other than a declarant in the case of a flexible common interest community or three years
in the case of any other common interest community, (ii) the declarant's voluntary surrender
of control by giving written notice to the unit owners pursuant to section 515B.1-115, or
(iii) the conveyance of 75 percent of the units to unit owners other than a declarant.

(d) The board shall cause a meeting of the unit owners to be called, as follows:

(1) If the period of declarant control has terminated pursuant to subsection (c), a meeting
of the unit owners shall be called and held within 60 days after said termination, at which
the board shall be appointed or elected by all unit owners, including declarant, subject to
the requirements of subsection (e).

(2) If 50 percent of the units that a declarant is authorized by the declaration to create
have been conveyed prior to the termination of the declarant control period, a meeting of
the unit owners shall be called and held within 60 days thereafter, at which not less than
33-1/3 percent of the members of the board shall be elected by unit owners other than a
declarant or an affiliate of a declarant.

(3) If the board fails or refuses to cause a meeting of the unit owners required to be called
pursuant to subsection (d), then the unit owners other than a declarant and its affiliates may
cause the meeting to be called pursuant to the applicable provisions of the law under which
the association was created. The declarant and its affiliates shall be deemed to be present
at the meeting for purposes of establishing a quorum regardless of their failure to attend the
meeting.

(e) Following the termination of any period of declarant control, the unit owners shall
appoint or elect the board. All unit owners, including the declarant and its affiliates, may
cast the votes allocated to any units owned by them. The board shall thereafter be subject
to the following:

(1) Unless otherwise approved by a vote of unit owners other than the declarant or an
affiliate of the declarant, a majority of the directors shall be unit owners or a natural person
designated by a unit owner that is not a natural person, other than a declarant or an affiliate
of a declarant. The remaining directors need not be unit owners unless required by the
articles of incorporation or bylaws.

(2) Subject to the requirements of subsection (e)(1), the articles of incorporation or
bylaws may authorize the declarant or a person designated by the declarant to appoint one
director, who need not be a member. The articles of incorporation or bylaws shall not be
amended to change or terminate the authorization to appoint one director without the written
consent of the declarant or other person possessing the power to appoint.

(3) Subject to the requirements of subsection (e)(1), the articles of incorporation or
bylaws may authorize special classes of directors and director voting rights, as follows: (i)
classes of directors, (ii) the appointment or election of directors in certain classes by certain
classes of members, or (iii) class voting by classes of directors on issues affecting only a
certain class or classes of members, units, or other parcels of real estate, or to otherwise
protect the legitimate interest of such class or classes. No person may utilize such special
classes or class voting for the purpose of evading any limitation imposed on declarants by
this chapter.

(4) The board shall elect the officers. The directors and officers shall take office upon
election.

(f) In determining whether the period of declarant control has terminated under subsection
(c), or whether unit owners other than a declarant are entitled to elect members of the board
of directors under subsection (d), the percentage of the units conveyed shall be calculated
using as a numerator the number of units conveyed and as a denominator the number of
units subject to the declaration plus the number of units which the declarant is authorized
by the declaration to create on any additional real estate. The percentages referred to in
subsections (c) and (d) shall be calculated without reference to units that are auxiliary to
other units, such as garage units or storage units. A person shall not use a master association
or other device to evade the requirements of this section.

(g) Except as otherwise provided in this subsection, meetings of the board of directors
must be open to the unit owners. To the extent practicable, the board shall give reasonable
notice to the unit owners of the date, time, and place of a board meeting. If the date, time,
and place of meetings are provided for in the declaration, articles, or bylaws, announced at
a previous meeting of the board, posted in a location accessible to the unit owners and
designated by the board from time to time, or if an emergency requires immediate
consideration of a matter by the board, notice is not required. "Notice" has the meaning
given in section 317A.011, subdivision 14. Meetings may be closed to discuss the following:

(1) personnel matters;

(2) pending or potential litigation, arbitration or other potentially adversarial proceedings,
between unit owners, between the board or association and unit owners, or other matters in
which any unit owner may have an adversarial interest, if the board determines that closing
the meeting is necessary to discuss strategy or to otherwise protect the position of the board
or association or the privacy of a unit owner or occupant of a unit; or

(3) criminal activity arising within the common interest community if the board
determines that closing the meeting is necessary to protect the privacy of the victim or that
opening the meeting would jeopardize investigation of the activity.

Nothing in this subsection imposes a duty on the board to provide special facilities for
meetings. The failure to give notice as required by this subsection shall not invalidate the
board meeting or any action taken at the meeting. The minutes of any part of a meeting that
is closed under this subsection may be kept confidential at the discretion of the board.

Sec. 120. new text begin REPEALER.
new text end

new text begin (a) new text end new text begin Minnesota Statutes 2024, sections 308C.003, subdivision 3; 308C.005, subdivisions
8, 20, 32, 34, 36, 37, 38, 42, and 44; 308C.241, subdivisions 3, 4, 5, and 6; 308C.301,
subdivisions 3, 4, 5, 6, 7, 10, 11, and 12; 308C.411, subdivisions 5 and 6; 308C.415,
subdivision 2; 308C.501, subdivisions 3 and 4; 308C.502; 308C.601, subdivisions 1, 3, 5,
and 7; 308C.605; 308C.611; 308C.612, subdivisions 4, 5, and 6; 308C.616; 308C.627;
308C.701; 308C.705; 308C.711; 308C.715; 308C.721, subdivision 1; 308C.725; and
308C.805, new text end new text begin are repealed.
new text end

new text begin (b) new text end new text begin Minnesota Statutes 2025 Supplement, sections 308C.301, subdivisions 8, 9, and 13;
and 308C.721, subdivision 2, new text end new text begin are repealed.
new text end

APPENDIX

Repealed Minnesota Statutes: 26-07582

308C.003 APPLICATION OF OTHER STATUTES.

Subd. 3.

Chapter 515B prevails.

In the event of a conflict between this chapter and chapter 515B, chapter 515B shall control.

308C.005 DEFINITIONS.

Subd. 8.

Chapter.

"Chapter" means sections 308C.001 to 308C.975.

Subd. 20.

Housing cooperative.

"Housing cooperative" means a housing cooperative governed by this chapter to provide housing on a not-for-profit and cooperative basis in accordance with the organizational purposes contemplated in this chapter.

Subd. 32.

Minnesota limited liability company.

"Minnesota limited liability company" means a limited liability company governed by chapter 322C.

Subd. 34.

Nonoccupant membership interest.

"Nonoccupant membership interest" means a membership interest that does not require the holder to be an occupant or resident of the cooperative.

Subd. 36.

Occupant membership interest.

"Occupant membership interest" means the composite ownership of both a membership certificate issued by the cooperative and a possessory right of occupancy of a dwelling unit or lot pursuant to an occupancy agreement or proprietary lease, including a member's financial rights and a member's governance rights.

Subd. 37.

Occupancy agreement.

"Occupancy agreement" means the agreement between the member and the cooperative describing the terms and conditions under which the member will occupy the dwelling unit or lot appurtenant to the member's membership interest.

Subd. 38.

Older persons.

"Older persons" means natural persons who are age 55 and older in accordance with the applicable provisions of the Fair Housing Act, Title VIII of the Civil Rights Act of 1968, as amended; United States Code, title 42, chapter 3607, section 807(a)(b)(1)(2), and the rules and regulations of the United States Department of Housing and Urban Development applicable with respect to housing for older persons contained in Code of Federal Regulations, title 24, subtitle B, chapter I, subpart E, section 100.300-308.

Subd. 42.

Resident.

"Resident" means any occupant of space owned by the cooperative or an owner of a manufactured home who rents a lot in a manufactured home park and includes the members of the resident's household.

Subd. 44.

Senior housing cooperative.

"Senior housing cooperative" means a housing cooperative governed by this chapter to provide housing on a not-for-profit and cooperative basis to older persons in accordance with the applicable provisions of the Fair Housing Act, Title VIII of the Civil Rights Act of 1968, as amended; United States Code, title 42, chapter 3607, section 807(a)(b)(1)(2), and the rules and regulations of the United States Department of Housing and Urban Development applicable with respect to housing for older persons contained in Code of Federal Regulations, title 24, subtitle B, chapter I, subpart E, section 100.300-308.

308C.241 BYLAWS.

Subd. 3.

Adoption.

(a) Bylaws may be adopted by the organizer or a nonoccupant member if, at the time of adoption, the cooperative does not have any occupant members.

(b) The bylaws of a cooperative may be adopted or amended by the members at a regular or special member meeting if:

(1) the notice of the regular or special meeting contains a statement that the bylaws or restated bylaws will be voted upon and copies are included with the notice, or copies are available upon request from the cooperative, and a summary statement of the proposed bylaws or amendment is included with the notice;

(2) a quorum is registered as being present or represented by mail or alternative voting method if the mail or alternative voting method is authorized by the board; and

(3) the bylaws or amendment is approved by a majority vote cast, or for a cooperative with articles or bylaws requiring more than majority approval or other conditions for approval, the bylaws or amendment is approved by a proportion of the vote cast or a number of the total members are required by the articles or bylaws and the conditions for approval in the articles or bylaws have been satisfied.

(c) Until the next annual or special members' meeting, the majority of directors may adopt and amend bylaws for the cooperative that are consistent with subdivisions 4 to 6, which may be further amended or repealed by the members at an annual or special members' meeting.

Subd. 4.

Amendment of bylaws by board or members.

(a) The board may amend the bylaws at any time to add, change, or delete a provision, unless:

(1) this chapter, the articles, or the bylaws reserve the power exclusively to the members in whole or in part; or

(2) a particular bylaw expressly prohibits the board from doing so.

(b) Any amendment of the bylaws by the board must be distributed to the members no later than ten days after adoption and the notice of the annual meeting of the members must contain a notice and summary or the actual amendments to the bylaws adopted by the board.

(c) The members may amend the bylaws even though the bylaws may also be amended by the board.

Subd. 5.

Bylaw changing quorum or voting requirement for members.

(a) The members may amend the bylaws to fix a greater quorum or voting requirement for members, or voting groups of members, than is required under this chapter. An amendment to the bylaws to add, change, or delete a greater quorum or voting requirement for members shall meet the same quorum requirement and be adopted by the same vote and voting groups required to take action under the quorum and voting requirements then in effect or proposed to be adopted, whichever is greater.

(b) A bylaw that fixes a greater quorum or voting requirement for members under paragraph (a) may not be adopted and shall not be amended by the board.

Subd. 6.

Bylaw changing quorum or voting requirement for directors.

(a) A bylaw that fixes a greater quorum or voting requirement for the board may be amended: (1) if adopted by the members, only by the members; or (2) if adopted by the board, either by the members or by the board.

(b) A bylaw adopted or amended by the members that fixes a greater quorum or voting requirement for the board may provide that the bylaw may be amended only by a specified vote of either the members or the board, but if the bylaw is to be amended by a specified vote of the members, the bylaw must be adopted by the same specified vote of the members.

(c) Action by the board under paragraph (a), clause (2), to adopt or amend a bylaw that changes the quorum or voting requirement for the board shall meet the same quorum requirement and be adopted by the same vote required to take action under the quorum and voting requirement then in effect or proposed to be adopted, whichever is greater.

308C.301 POWERS.

Subd. 3.

Contracts with members.

A cooperative may enter into or become a party to a contract or agreement for the cooperative or for the cooperative's members or others or between the cooperative and its members.

Subd. 4.

Holding and transactions of real and personal property.

(a) A cooperative may purchase and hold, lease, mortgage, encumber, sell, exchange, insure, and convey as a legal entity real, personal, and intellectual property, including real estate, buildings, personal property, patents, and copyrights as the business of the cooperative may require, including the sale or other disposition of assets required by the business of the cooperative as determined by the board.

(b) A cooperative may take, receive, and hold real and personal property, including the principal and interest of money or other funds and rights in a contract, in trust for any purpose not inconsistent with the purposes of the cooperative in its articles or bylaws and may exercise fiduciary powers in relation to taking, receiving, and holding the real and personal property.

Subd. 5.

Buildings.

A cooperative may erect buildings or other structures or facilities on the cooperative's owned or leased property or on a right-of-way legally acquired by the cooperative.

Subd. 6.

Debt instruments.

A cooperative may issue bonds, debentures, or other evidence of indebtedness and may borrow money, may secure any of its obligations by mortgage of or creation of a security interest in or other encumbrances or assignment of all or any of its property, franchises, or income, and may issue guarantees for any legal purpose. The cooperative may form special purpose business entities to secure assets of the cooperative.

Subd. 7.

Advances to occupants.

A cooperative may make advances to its members.

Subd. 8.

Deposits.

A cooperative may accept donations or deposits of money or real personal property from other cooperatives, associations, organizations, agencies, municipalities, and local, state, and federal governments.

Subd. 9.

Lending, borrowing, investing.

A cooperative may loan or borrow money to or from members, other cooperatives, associations, organizations, agencies, municipalities, and local, state, and federal governments with security that it considers sufficient. A cooperative may invest and reinvest its funds.

Subd. 10.

Pensions and benefits.

A cooperative may pay pensions, retirement allowances, and compensation for past services to and for the benefit of; and establish, maintain, continue, and carry out, wholly or partially at the expense of the cooperative, employee or incentive benefit plans, trust, and provisions to or for the benefit of any or all of its and its related organizations' officers, managers, directors, governors, employees, and agents; and in the case of a related organization that is a cooperative, members who provide services to the cooperative, and any of their families, dependents, and beneficiaries. It may indemnify and purchase and maintain insurance for and on behalf of a fiduciary of any of these employee benefit and incentive plans, trusts, and provisions.

Subd. 11.

Insurance.

A cooperative may provide for its benefit life insurance and other insurance with respect to the services of any or all of its members, managers, directors, employees, and agents, or on the life of a member for the purpose of acquiring at the death of the member any or all membership interests in the cooperative owned by the member.

Subd. 12.

Ownership interests in other entities.

(a) A cooperative may purchase, acquire, hold, or dispose of the ownership interests of another business entity or organize business entities whether organized under the laws of this state or another state or the United States and assume all rights, interests, privileges, responsibilities, and obligations arising out of the ownership interest.

(b) A cooperative may purchase, own, and hold ownership interests, including stock and other equity interests, memberships, interests in nonstock capital, and evidences of indebtedness of any domestic business entity or foreign business entity.

Subd. 13.

Fiduciary powers.

A cooperative may exercise any and all fiduciary powers in relations with members, other cooperatives, associations, organizations, agencies, municipalities, and local, state, and federal governments.

308C.411 ELECTION OF DIRECTORS.

Subd. 5.

Business entity members may nominate persons for director.

If a member of a cooperative is not a natural person, and the bylaws do not provide otherwise, the member may appoint or elect one or more natural persons to be eligible for election as a director.

Subd. 6.

Acts not void or voidable.

The expiration of a director's term with or without the election of a qualified successor does not make prior or subsequent acts of the director void or voidable.

308C.415 FILLING VACANCIES.

Subd. 2.

Nonoccupant directors.

If the vacating director was not elected by the occupant members or a new director position is created, unless otherwise provided in the articles or bylaws, the board shall appoint a director to fill the vacant position by majority vote of the remaining or then serving directors even though less than a quorum. At the next regular or special members' meeting, the members shall elect a director to fill the unexpired term of the vacant director's position.

308C.501 MEMBERS.

Subd. 3.

Member violations.

(a) A member who knowingly, intentionally, or repeatedly violates a provision of the articles, bylaws, occupancy agreement, proprietary lease or rules, policies, and procedures promulgated by the board may be required by the board to surrender the member's membership interest and occupancy rights or any other financial rights of membership interests of any class owned by a member, or both.

(b) The cooperative shall refund to the member for the surrendered membership interest at the lesser of the book value or the price paid the member for the membership interest payable in not more than seven years from the date of surrender.

(c) Membership interests required to be surrendered may be reissued or be retired and canceled by the board.

(d) The board may establish a procedure for members to dispute the basis for an alleged violation.

Subd. 4.

Inspection of cooperative records by member.

(a) A member is entitled to inspect and copy, at the member's expense, during regular business hours at a reasonable location specified by the cooperative, any of the records described in section 308C.245 if the member meets the requirements of paragraph (b) and gives the cooperative written demand at least five business days before the date on which the member wishes to inspect and copy the records. Notwithstanding the provisions of this subdivision or any provisions of section 308C.245, a cooperative may limit a member's right to inspect or copy any records of the cooperative relating to the amount of equity capital in the cooperative held by any person or any accounts receivable or other amounts due the cooperative from any person, or any personnel records or employment records of any employee.

(b) To be entitled to inspect and copy permitted records, the member shall meet the following requirements:

(1) the demand is made in good faith and for a proper cooperative business purpose;

(2) the member describes with reasonable particularity the purpose and the records the member desires to inspect; and

(3) the records are directly connected with the described purpose.

(c) The right of inspection granted by this subdivision shall not be abolished or limited by the articles, bylaws, or any actions of the board or the members.

(d) This subdivision does not affect:

(1) the right of a member to inspect records to the same extent as any other litigant if the member is in litigation with the cooperative; or

(2) the power of a court to compel the production of the cooperative's records for examination.

(e) Notwithstanding any other provision in this subdivision, if the records to be inspected or copied are in active use or storage and, therefore, not available at the time otherwise provided for inspection or copying, the cooperative shall notify the member and shall set a date and hour within three business days of the date otherwise set in this subdivision for the inspection or copying.

(f) A member's agent or attorney has the same inspection and copying rights as the member. The right to copy records under this subdivision includes, if reasonable, the right to receive copies made by photographic copying, xerographic copying, or other means. The cooperative may impose a reasonable charge, covering the costs of labor and material, for copies of any documents provided to the member. The charge may not exceed the estimated cost of production and reproduction of the records.

(g) If a cooperative refuses to allow a member, or the member's agent or attorney, who complies with this subdivision to inspect or copy any records that the member is entitled to inspect or copy within a prescribed time limit or, if none, within a reasonable time, the district court of the county in this state where the cooperative's principal office is located or, if it has no principal office in this state, the district court of the county in which its registered office is located may, on application of the member, summarily order the inspection or copying of the records demanded at the cooperative's expense.

(h) If a court orders inspection or copying of the records demanded, unless the cooperative proves that it refused inspection or copying in good faith because it had a reasonable basis for doubt about the right of the member or the member's agent or attorney to inspect or copy the records demanded:

(1) the court may order the losing party to pay the prevailing party's reasonable costs, including reasonable attorney fees;

(2) the court may order the losing party to pay the prevailing party for any damages the prevailing party shall have incurred by reason of the subject matter of the litigation;

(3) if inspection or copying is ordered under this paragraph, the court may order the cooperative to pay the member's inspection and copying expenses;

(4) the court may grant either party any other remedy provided by law; and

(5) the court may impose reasonable restrictions on the use or distribution of the records by the demanding member.

308C.502 MEMBER RESTRICTIONS.

Subdivision 1.

Older persons.

In accordance with the applicable provisions of the Fair Housing Act, Title VIII of the Civil Rights Act of 1968, as amended; United States Code, title 42, chapter 3607, section 807(a)(b)(1)(2), and the rules and regulations of the United States Department of Housing and Urban Development applicable with respect to housing for older persons contained in Code of Federal Regulations, title 24, subtitle B, chapter I, subpart E, section 100.300-308, membership and housing in a cooperative governed by this chapter may be age restricted to older persons. As used in this section, "housing for older persons" means housing:

(1) intended for, and solely occupied by, persons 62 years of age or older, except that:

(i) as to joint holders of a membership, only one person need be age 62 or older; and

(ii) as to a trust that is the holder of a membership pursuant to the requirements of this chapter, only one beneficiary who intends to occupy the cooperative as a member need be age 62 or older; or

(2) intended and operated for occupancy by persons 55 years of age or older, and:

(i) at least 80 percent of the occupied units are occupied by at least one person who is 55 years of age or older;

(ii) the housing facility or community publishes and adheres to policies and procedures that demonstrate the intent required under this clause; and

(iii) the housing facility or community complies with rules issued by the secretary of housing and urban development for verification of occupancy, which shall:

(A) provide for verification by reliable surveys and affidavits; and

(B) include examples of the types of policies and procedures relevant to a determination of compliance with the requirement of item (ii). Such surveys and affidavits shall be admissible in administrative and judicial proceedings for the purposes of such verification.

Subd. 2.

Persons of low or moderate income.

In accordance with the applicable provisions of the Fair Housing Act, Title VIII of the Civil Rights Act of 1968, as amended; United States Code, title 42, chapter 3607, section 807(a)(b)(1)(2), membership and housing in a cooperative governed by this chapter may be restricted to persons of low or moderate income.

Subd. 3.

Persons by activity.

Membership and housing in a cooperative governed by this chapter may be restricted to persons engaged in a specific activity or persons who meet a specified characteristic based on past activity provided such restriction does not violate any provision of the Fair Housing Act, Title VIII of the Civil Rights Act of 1968, as amended; United States Code, title 42, chapter 3607, section 807(a)(b)(1)(2).

Subd. 4.

Additional restrictions.

Cooperatives governed by this chapter may impose the same age or income restrictions on any nonmember occupants the board may permit to reside at the housing cooperative.

308C.601 MEMBERSHIP INTERESTS.

Subdivision 1.

Amounts and divisions of membership interests.

The authorized amount and divisions of occupant membership interests and, if authorized, nonoccupant membership interests may be increased, decreased, established, or altered, in accordance with the restrictions in this chapter by amending the articles or bylaws at a regular members' meeting or at a special members' meeting called for the purpose of the amendment.

Subd. 3.

Occupant membership interests.

The occupant membership interests collectively shall have not less than 60 percent of the cooperative's financial rights to profit allocations and distributions. If authorized in the original articles as filed, or articles or bylaws adopted by an affirmative vote of the occupant members, or the articles or bylaws are amended by the affirmative vote of occupant members, then the cooperative's financial rights to profit allocations and distributions to occupant members collectively may be not less than 15 percent.

Subd. 5.

Nonoccupant membership interests.

If authorized by the articles, the cooperative may solicit and issue nonoccupant membership interests on terms and conditions determined by the board and disclosed in the articles, bylaws, or by separate disclosure to the members. Each member acquiring nonoccupant membership interests shall sign a member control agreement or agree to the conditions of the bylaws, either of which shall describe the rights and obligations of the member as it relates to the nonoccupant membership interests, the financial and governance rights, the transferability of the nonoccupant membership interests, the division and allocations of profits and losses among the membership interests and membership classes, and financial rights upon liquidation. If the articles or bylaws do not otherwise provide for the allocation of the profits and losses between occupant membership interests and nonoccupant membership interests, then the allocation of profits and losses among nonoccupant membership interests individually and occupant membership interests collectively shall be allocated on the basis of the value of contributions to capital made according to the occupant membership interests collectively and the nonoccupant membership interests individually to the extent the contributions have been accepted by the cooperative. Distributions of cash or other assets of the cooperative shall be allocated among the membership interests as provided in the articles and bylaws, subject to the provisions of this chapter. If not otherwise provided in the articles or bylaws, distributions shall be made on the basis of value of the capital contributions of the occupant membership interests collectively and the nonoccupant membership interests to the extent the contributions have been accepted by the cooperative.

Subd. 7.

Payment for nonoccupant membership interests.

Subject to the provisions in the articles and bylaws, a member may dissent from and obtain payment for the fair value of the member's nonoccupant membership interests in the cooperative if the articles or bylaws are amended in a manner that materially and adversely affects the rights and preferences of the nonoccupant membership interests of the dissenting member. The dissenting member shall file a notice of intent to demand fair value of the membership interest with the records officer of the cooperative within 30 days after the amendment of the bylaws and notice of the amendment to members, otherwise the right of the dissenting member to demand payment of fair value for the membership interest is waived. If a proposed amendment of the articles or bylaws must be approved by the members, a member who is entitled to dissent and who wishes to exercise dissenter's rights shall file a notice to demand fair value of the membership interest with the records officer of the cooperative before the vote on the proposed action and shall not vote in favor of the proposed action, otherwise the right to demand fair value for the membership interest by the dissenting member is waived. After receipt of the dissenting member's demand notice and approval of the amendment, the cooperative has 60 days to rescind the amendment or otherwise the cooperative shall remit the fair value for the member's interest to the dissenting member by 180 days after receipt of the notice. Upon receipt of the fair value for the membership interest, the member has no further member rights in the cooperative.

308C.605 ASSIGNMENT OF FINANCIAL RIGHTS.

Subdivision 1.

Assignment of financial rights permitted.

Except as provided in subdivision 3, a member's financial rights are transferable in whole or in part.

Subd. 2.

Effect of assignment of financial rights.

An assignment of a member's financial rights entitles the assignee to receive, to the extent assigned, only the share of profits and losses and the distributions, if any, to which the assignor would otherwise be entitled. An assignment of a member's financial rights does not dissolve the cooperative and does not entitle or empower the assignee to become a member, to exercise any governance rights, to receive any notices from the cooperative, or to cause dissolution. The assignment shall not allow the assignee to control the member's exercise of governance or voting rights.

Subd. 3.

Restrictions of assignment of financial rights.

(a) A restriction on the assignment of financial rights may be imposed in the articles, in the bylaws, in an operating agreement, by a resolution adopted by the members, by an agreement among or other written action by the members, or by an agreement among or other written action by the members and the cooperative. A restriction is not binding with respect to financial rights reflected in the required records before the adoption of the restriction, unless the owners of those financial rights are parties to the agreement or voted in favor of the restriction.

(b) Subject to paragraph (c), a written restriction on the assignment of financial rights that is not manifestly unreasonable under the circumstances and is noted conspicuously in the required records may be enforced against the owner of the restricted financial rights or a successor or transferee of the owner, including a pledgee or a legal representative. Unless noted conspicuously in the required records, a restriction, even though permitted by this section, is ineffective against a person without knowledge of the restriction.

(c) With regard to restrictions on the assignment of financial rights, a would-be assignee of financial rights is entitled to rely on a statement of membership interest issued by the cooperative. A restriction on the assignment of financial rights, which is otherwise valid and in effect at the time of the issuance of a statement of membership interest but which is not reflected in that statement, is ineffective against an assignee who takes an assignment in reliance on the statement.

(d) Notwithstanding any provision of law, articles, bylaws, operating agreement, other agreement, resolution, or action to the contrary, a security interest in a member's financial rights may be foreclosed and otherwise enforced, and a secured party may assign a member's financial rights in accordance with chapter 336, without the consent or approval of the member whose financial rights are subject to the security interest.

308C.611 NATURE OF A MEMBERSHIP INTEREST AND STATEMENT OF INTEREST OWNED.

Subdivision 1.

Generally.

A membership interest is personal property. A member has no interest in specific cooperative property except the right to occupy a dwelling unit pursuant to an occupancy agreement, the proprietary lease, and use of the common elements. All property of the cooperative is property of the cooperative itself.

Subd. 2.

Lien on membership interest.

The cooperative may take a lien on the membership interest and any dwelling unit represented by the membership certificate for all sums due and to become due under the articles, bylaws, occupancy agreement, and propriety lease whether by means of assessments or otherwise. The board may refuse consent to the transfer of the membership interest represented by the membership certificate until all outstanding sums due under the occupancy agreement are paid or for other reasonable cause described in the bylaws.

Subd. 3.

Terms of membership interests.

All the membership interests of a cooperative must:

(1) be of one class, without series, unless the articles or bylaws establish or authorize the board to establish more than one class or series within classes;

(2) be occupant membership interests and if authorized nonoccupant membership interest subject to this chapter entitled to vote as provided in section 308C.545, and have equal rights and preferences in all matters not otherwise provided for by the board and to the extent that the articles or bylaws have fixed the relative rights and preferences of different classes and series; and

(3) if applicable due to the nature of the cooperative, share profits and losses and are entitled to distributions as provided in sections 308C.721 and 308C.725.

Subd. 4.

Rights of judgment creditor.

On application to a court of competent jurisdiction by any judgment creditor of a member, the court may charge a member with payment of the unsatisfied amount of the judgment with interest. To the extent so charged, the judgment creditor has only the rights of an assignee of a member's financial rights, if any. This chapter does not deprive any member or a judgment creditor who is an assignee of financial rights of the benefit of any exemption laws applicable to the membership interest. This section is the sole and exclusive remedy of a judgment creditor with respect to the judgment debtor's membership interest.

Subd. 5.

Procedure for fixing terms.

(a) Subject to any restrictions in the articles or bylaws, the power granted in this subdivision may be exercised by a resolution or resolutions establishing a class or series, setting forth the designation of the class or series, and fixing the relative rights and preferences of the class or series. Any of the rights and preferences of a class or series established in the articles, bylaws, or by resolution of the board:

(1) may be made dependent upon facts ascertainable outside the articles or bylaws or outside the resolution or resolutions establishing the class or series, if the manner in which the facts operate upon the rights and preferences of the class or series is clearly and expressly set forth in the articles or bylaws or in the resolution or resolutions establishing the class or series; and

(2) may include by reference some or all of the terms of any agreements, contracts, or other arrangements entered into by the cooperative in connection with the establishment of the class or series if the cooperative retains at its principal executive office a copy of the agreements, contracts, or other arrangements or the portions will be included by reference.

(b) A statement setting forth the name of the cooperative and the text of the resolution and certifying the adoption of the resolution and the date of adoption must be given to the members before the acceptance of any contributions for which the resolution creates rights or preferences not set forth in the articles or bylaws. Where the members have received notice of the creation of membership interests with rights or preferences not set forth in the articles or bylaws before the acceptance of the contributions with respect to the membership interests, the statement may be filed any time within one year after the acceptance of the contributions. The resolution is effective three days after delivery to the members is deemed effective by the board, or, if the statement is not required to be given to the members before the acceptance of contributions, on the date of its adoption by the directors.

Subd. 6.

Specific terms.

Without limiting the authority granted in this section, a cooperative may have membership interests of a class or series:

(1) subject to the right of the cooperative to redeem any of those membership interests at the price fixed for their redemption by the articles or bylaws or by the board;

(2) entitling the members to cumulative, partially cumulative, or noncumulative distributions;

(3) having preference over any class or series of membership interests for the payment of distributions of any or all kinds;

(4) convertible into membership interests of any other class or any series of the same or another class; or

(5) having full, partial, or no voting rights, except as provided in section 308B.555.

Subd. 7.

Grant of a security interest.

For the purpose of any law relating to security interests, membership interests, governance or voting rights, and financial rights are each to be characterized as provided in section 336.8-103, paragraph (c).

Subd. 8.

Powers of estate of a deceased or incompetent member.

(a) If a member who is an individual dies or a court of competent jurisdiction adjudges the member to be incompetent to manage the member's person or property, or an order for relief under the bankruptcy code is entered with respect to the member, the member's executor, administrator, guardian, conservator, trustee, or other legal representative may exercise all of the member's rights for the purpose of settling the estate or administering the member's property. If a member is a business entity, trust, or other entity and is dissolved, terminated, or placed by a court in receivership or bankruptcy, the powers of that member may be exercised by its legal representative or successor.

(b) If an event referred to in paragraph (a) causes the termination of a member's membership interest and the termination does not result in dissolution, then subject to the articles and bylaws:

(1) as provided in section 308C.605, the terminated member's interest will be considered to be merely that of an assignee of the financial rights owned before the termination of membership; and

(2) the rights to be exercised by the legal representative of the terminated member will be limited accordingly.

Subd. 9.

Liability of subscribers and members with respect to membership interests.

A subscriber for membership interests or a member of a cooperative is under no obligation to the cooperative or its creditors with respect to the membership interests subscribed for or owned, except to pay to the cooperative the full consideration for which the membership interests are issued or to be issued.

308C.612 SENIOR HOUSING COOPERATIVE OFFERING DOCUMENTS; GENERAL PROVISIONS.

Subd. 4.

Subscription agreement for new project.

The subscription agreement must include the following provisions:

(1) a statement that all subscription funds received from applicants shall be deposited promptly without deduction in an escrow account at a bank or banks whose deposits are insured by an agency of the federal government. The escrow account shall be controlled by a licensed title insurance company or agent thereof. Money in the account shall be held solely for the benefit of the subscribers until transferred to the account of the cooperative as provided in clauses (2) and (5). The escrow account may be interest bearing, in which event interest earnings shall accrue to the benefit of subscribers, except that subscription funds and interest earned, if any, may be used solely to pay the escrow agent to administer the escrow account and to pay costs and expenses associated with the offering;

(2) a statement of any subscription funds due and payable upon execution of the subscription agreement and, where less than all of the subscription funds are due and payable upon execution of the subscription agreement, a statement of the balance due and payable and the estimated time frame within which that balance must be paid;

(3) a statement of the estimated monthly carrying charges with respect to the membership interest being subscribed for;

(4) a statement that refundable subscription funds shall be immediately refunded by the escrow agent to an applicant whose subscription agreement is terminated pursuant to the agreement and a statement whether the return of subscription funds shall be with or without accrued interest earned on the escrow;

(5) a statement concerning the deadline when sufficient subscribers and loan commitments must be obtained, and a statement that if the deadline is not attained, the subscribers' escrowed funds will be released;

(6) a statement that the entire escrow account and accrued interest earned, if any, shall be immediately paid to the cooperative if sufficient subscribers and loan commitments are obtained by the disclosed end date and the cooperative proceeds with the project;

(7) a statement that:

(i) within ten days after the receipt of an information bulletin, a purchaser may cancel the subscription agreement for the purchase of a membership in a cooperative, provided that the right to cancel terminates upon the purchaser's voluntary acceptance of a conveyance of the membership interest from the cooperative or by the purchaser agreeing to modify or waive the right to cancel by a separate writing from the subscription agreement and signed by the purchaser more than three days after the purchaser receives the information bulletin; and

(ii) if a purchaser receives an information bulletin more than ten days before signing a subscription agreement, the purchaser cannot cancel the subscription agreement pursuant to this ten-day cancellation.

Subd. 5.

Membership purchase and sale agreements.

In the event of a resale of a membership interest by either the departing member or by the cooperative, a membership purchase and sale agreement shall be utilized as the contract for purchase of the membership interest rather than a subscription agreement. A membership purchase and sale agreement must contain the following provisions:

(1) a statement disclosing the identities of the selling and purchasing parties;

(2) a statement acknowledging that the purchase of a membership interest in the cooperative constitutes personal property and not an interest in real estate;

(3) a statement of the purchase price for the membership interest, including any earnest money due and payable, the date on which the membership interest is due and payable, and any sum which may be due and payable upon closing;

(4) a schedule of any items of personal property owned by the seller that the buyer is purchasing as part of the membership interest;

(5) a statement acknowledging that the seller and the cooperative have furnished the buyer with copies of the cooperative's articles of incorporation, bylaws, rules, and policies currently in effect and a resale disclosure statement;

(6) a statement that:

(i) within ten days after the receipt of a copy of the documents set forth in clause (5), a purchaser may cancel the purchase agreement for the purchase of a membership in a cooperative, without penalty and with a full and prompt refund of all payments made under the purchase agreement, unless within that ten-day period the buyer has closed on the purchase of the membership interest; and

(ii) if the buyer elects to cancel the purchase agreement pursuant to this provision, the buyer may do so in writing by hand delivering the notice of cancellation to the seller or seller's agent, or by mailing such notice by postage prepaid United States mail, to the seller or the seller's agent within the ten-day period;

(7) a statement outlining any contingencies or conditions precedent to closing on the purchase of the membership interest and the impact of a failure of one or more of the articulated contingencies on the refund of any earnest money to the buyer;

(8) a statement of the monthly carrying charges allocable to the dwelling unit appurtenant to the membership interest being purchased and any adjustments or prorations of carrying charges due and payable in the month of closing as between the seller and buyer;

(9) a statement of any dwelling alterations that will be permitted prior to closing, the conditions under which those alterations may be made, and the parties financially responsible for any such alterations;

(10) a statement of the anticipated closing date for the purchase of the membership interest;

(11) a statement of the remedies available to the seller or buyer as a result of a default by the other party in its obligation to close on the purchase of the subject membership interest;

(12) a schedule of the items to be delivered at closing which shall include:

(i) the seller's delivery of seller's membership certificate to the buyer, duly assigned to the buyer;

(ii) the seller's delivery to the buyer of a bill of sale in a form reasonably acceptable to the buyer, conveying to the buyer free and clear of all encumbrances any personal property purchased by the buyer pursuant to clause (4);

(iii) the buyer's delivery to the seller of funds representing any balance of the purchase price due and payable; and

(iv) the buyer's delivery to the cooperative of an occupancy agreement duly executed by the buyer; and

(13) a statement regarding the impact of destruction of the subject dwelling unit prior to the closing date on the buyer's purchase obligations and refund of any earnest money paid.

Subd. 6.

Occupancy agreement contents.

The occupancy agreement must include the following provisions:

(1) a statement of the monthly carrying charges due and payable by the member to the cooperative representing the member's proportionate share of the sum that the cooperative's board of directors' estimates are required to meet the cooperative's annual expenses, and the method of calculating the same;

(2) a statement of when the payment of carrying charges will commence;

(3) a statement of the circumstances under which the cooperative may issue any patronage refunds or credits to members;

(4) a statement that the term of the occupancy agreement is coextensive with membership in the cooperative, a statement regarding any automatic renewal of the occupancy agreement term, and a statement of any other terms, conditions, or requirements for renewal of the occupancy agreement term;

(5) a statement of the terms under which the member or cooperative may terminate a member's occupancy agreement;

(6) a statement that the member may occupy the member's dwelling unit solely as a private residential dwelling unit;

(7) a statement outlining the member's rights, duties, and obligations under the occupancy agreement and as a member of the cooperative;

(8) a statement outlining member acts prohibited by the occupancy agreement, articles, bylaws, or the rules, regulations, and policies of the cooperative;

(9) a statement regarding the circumstances under which assignment of the occupancy agreement or subletting is to be permitted or prohibited;

(10) a statement outlining the circumstances and manner in which a membership interest can be transferred, assigned, or sold;

(11) a statement outlining the manner in which the cooperative will manage the cooperative property and operate and administer the cooperative's business, including the payment of all taxes and assessments levied against the cooperative to the extent not billed by the taxing authority directly to the member;

(12) a statement outlining the separate insurance obligations of the cooperative and the member, and should minimally include the separate insurance requirements set forth in this chapter;

(13) a statement concerning the circumstances and extent to which the cooperative must repair, maintain, and replace property owned by the cooperative and the circumstances, if any, under which the cooperative may hold the member responsible for repairing, maintaining, or replacing property owned by the cooperative;

(14) a statement defining events of default under the occupancy agreement, the effects of default, and the remedies available to the cooperative;

(15) a statement through which the member covenants that the member and the member's guests and subtenants, if any, must preserve and promote the cooperative ownership principles of the cooperative and abide by the cooperative's articles, bylaws, and rules, policies and regulations;

(16) a statement that representatives of any mortgagee holding a mortgage on the property of the cooperative, the officers and employees of the cooperative, and, with the approval of the cooperative, the employees of any contractor, utility company, municipal agency, or others, has the right to enter the member's dwelling unit and make inspections at any reasonable hour of the day with reasonable notice and at any time in the event of emergency; and

(17) a statement that the cooperative will not discriminate against any person because of race, color, religion, sex, handicap, or national origin.

308C.616 CERTIFICATED MEMBERSHIP INTERESTS.

Subdivision 1.

Certificated; uncertificated.

The membership interests of a cooperative shall be either certificated or uncertificated. Each holder of certificated membership interests issued is entitled to a certificate of membership interest.

Subd. 2.

Signature required.

Certificates shall be signed by an agent or officer authorized in the articles or bylaws to sign share certificates or, in the absence of an authorization, by the chair or records officer of the cooperative.

Subd. 3.

Signature valid.

If a person signs or has a facsimile signature placed upon a certificate while the chair, an officer, transfer agent, or records officer of a cooperative, the certificate may be issued by the cooperative, even if the person has ceased to have that capacity before the certificate is issued, with the same effect as if the person had that capacity at the date of its issue.

Subd. 4.

Form of certificate.

A certificate representing membership interests of a cooperative shall contain on its face:

(1) the name of the cooperative;

(2) a statement that the cooperative is organized under the laws of this state and this chapter;

(3) the name of the person to whom the certificate is issued;

(4) the number and class of membership interests, and the designation of the series, if any, that the certificate represents;

(5) a statement that the membership interests in the cooperative are subject to the articles and bylaws of the cooperative; and

(6) any restrictions on transfer, including approval of the board, if applicable, first rights of purchase by the cooperative, and other restrictions on transfer, which may be stated by reference to the back of the certificate or to another document.

Subd. 5.

Limitations set forth.

A certificate representing membership interest issued by a cooperative authorized to issue membership interests of more than one class or series shall set forth upon the face or back of the certificate, or shall state that the cooperative will furnish to any member upon request and without charge, a full statement of the designations, preferences, limitations, and relative rights of the membership interests of each class or series authorized to be issued, so far as they have been determined, and the authority of the board to determine the relative rights and preferences of subsequent classes or series.

Subd. 6.

Prima facie evidence.

A certificate signed as provided in subdivision 2 is prima facie evidence of the ownership of the membership interests referred to in the certificate.

Subd. 7.

Uncertificated membership interests.

Unless uncertificated membership interests are prohibited by the articles or bylaws, a resolution approved by the affirmative vote of a majority of the directors present may provide that some or all of any or all classes and series of its membership interests will be uncertificated membership interests. The resolution does not apply to membership interests represented by a certificate until the certificate is surrendered to the cooperative. Within a reasonable time after the issuance or transfer of uncertificated membership interests, the cooperative shall send to the new member the information required by this section to be stated on certificates. This information is not required to be sent to the new holder by a publicly held cooperative that has adopted a system of issuance, recordation, and transfer of its membership interests by electronic or other means not involving an issuance of certificates if the system complies with section 17A of the Securities Exchange Act of 1934. Except as otherwise expressly provided by statute, the rights and obligations of the holders of certificated and uncertificated membership interests of the same class and series are identical.

308C.627 OPERATING AGREEMENT.

Subdivision 1.

Authorization.

A written agreement among persons who are then members, including a sole member, or who have signed subscription or contribution agreements, relating to the control of any phase of the business and affairs of the cooperative, its liquidation, dissolution and termination, or the relations among members or persons who have signed subscription or contribution agreements is valid as provided in subdivision 2. Wherever this chapter provides that a particular result may or must be obtained through a provision in the articles or bylaws, the same result can be accomplished through an operating agreement valid under this section or through a procedure established by an operating agreement valid under this section.

Subd. 2.

Valid execution.

Other than occupant member voting control under section 308C.545 and occupant member allocation and distribution provisions under sections 308C.721 and 308C.725, a written agreement among persons described in subdivision 1 that relates to the control of or the liquidation, dissolution, and termination of the cooperative; the relations among them; or any phase of the business and affairs of the cooperative, including, without limitation, the management of its business; the declaration and payment of distributions; the sharing of profits and losses; the election of directors; the employment of members by the cooperative; or the arbitration of disputes, is valid, if the agreement is signed by all persons who are then the members of the cooperative, whether or not the members all have voting power, and all those who have signed contribution agreements, regardless of whether those signatories will, when members, have voting power.

Subd. 3.

Other agreements not affected.

This section does not apply to, limit, or restrict agreements otherwise valid, nor is the procedure set forth in this section the exclusive method of agreement among members or between the members and the cooperative with respect to any of the matters described.

308C.701 AUTHORIZATION, FORM, AND ACCEPTANCE OF CONTRIBUTIONS.

Subdivision 1.

Board of directors may authorize.

Subject to any restrictions in this chapter regarding occupant and nonoccupant membership interests or in the articles or bylaws, and only when authorized by the board, a cooperative may accept contributions, which may be occupant or nonoccupant membership contributions as determined by the board under subdivisions 2 and 3, make contribution agreements under section 308C.711, and make contribution allowance agreements under section 308C.715.

Subd. 2.

Permissible forms.

A person may make a contribution to a cooperative:

(1) by paying money or transferring the ownership of an interest in property to the cooperative or rendering services to or for the benefit of the cooperative; or

(2) through a written obligation signed by the person to pay money or transfer ownership of an interest in property to the cooperative or to perform services to or for the benefit of the cooperative.

Subd. 3.

Acceptance of contributions.

No purported contribution is to be treated or considered as a contribution, unless:

(1) the board accepts the contribution on behalf of the cooperative and in that acceptance describes the contribution, including terms of future performance, if any, and states the value being accorded to the contribution; and

(2) the fact of contribution and the contribution's accorded value are both reflected in the required records of the cooperative.

Subd. 4.

Valuation.

The determinations of the board as to the amount or fair value or the fairness to the cooperative of the contribution accepted or to be accepted by the cooperative or the terms of payment or performance, including under a contribution agreement in section 308C.711, and a contribution allowance agreement in section 308C.715, are presumed to be proper if they are made in good faith and on the basis of accounting methods, or a fair valuation or other method, reasonable in the circumstances. Directors who are present and entitled to vote, and who, intentionally or without reasonable investigation, fail to vote against approving a consideration that is unfair to the cooperative, or overvalue property or services received or to be received by the cooperative as a contribution, are jointly and severally liable to the cooperative for the benefit of the then members who did not consent to and are damaged by the action, to the extent of the damages of those members. A director against whom a claim is asserted under this subdivision, except in case of knowing participation in a deliberate fraud, is entitled to contribution on an equitable basis from other directors who are liable under this subdivision.

308C.705 RESTATEMENT OF VALUE OF PREVIOUS CONTRIBUTIONS.

Subdivision 1.

Definition.

As used in this section, an "old contribution" is a contribution reflected in the required records of a cooperative for a nonoccupant membership interest before the time the cooperative accepts a new contribution for a nonoccupant membership interest.

Subd. 2.

Restatement required.

Whenever a cooperative accepts a new contribution for a nonoccupant membership interest, the board shall restate, as required by this section, the value of all old contributions.

Subd. 3.

Restatement as to particular series or class to which new contribution pertains.

(a) Unless otherwise provided in the articles or bylaws, this subdivision sets forth the method of restating the value of old contributions that pertain to the same series or class to which the new contribution pertains. To restate the value:

(1) state the value the cooperative has accorded to the new contribution under section 308C.701, subdivision 3, clause (1);

(2) determine what percentage the value stated under clause (1) will constitute, after the restatement required by this subdivision, of the total value of all contributions that pertain to the particular series or class to which the new contribution pertains;

(3) divide the value stated under clause (1) by the percentage determined under clause (2), yielding the total value, after the restatement required by this subdivision, of all contributions pertaining to the particular series or class;

(4) subtract the value stated under clause (1) from the value determined under clause (3), yielding the total value, after the restatement required by this subdivision, of all the old contributions pertaining to the particular series or class;

(5) subtract the value, as reflected in the required records before the restatement required by this subdivision, of the old contributions from the value determined under clause (4), yielding the value to be allocated among and added to the old contributions pertaining to the particular series or class; and

(6) allocate the value determined under clause (5) proportionally among the old contributions pertaining to the particular series or class, add the allocated values to those old contributions, and change the required records accordingly.

(b) The values determined under paragraph (a), clause (5), and allocated and added under paragraph (a), clause (6), may be positive, negative, or zero.

Subd. 4.

Restatement method for other series or class.

Unless otherwise provided in the articles or bylaws, this subdivision sets forth the method of restating the value of old contributions that do not pertain to the same series or class to which the new contribution pertains. To restate the value:

(1) determine the percentage by which the restatement under subdivision 3 has changed the total contribution value reflected in the required records for the series or class to which the new contribution pertains; and

(2) as to each old contribution that does not pertain to the same series or class to which the new contribution pertains, change the value reflected in the required records by the percentage determined under clause (1). The percentage determined under clause (1) may be positive, negative, or zero.

Subd. 5.

New contributions may be aggregated.

If a cooperative accepts more than one contribution pertaining to the same series or class at the same time, then for the purpose of the restatement required by this section, the cooperative may consider all the new contributions a single contribution.

308C.711 CONTRIBUTION AGREEMENTS.

Subdivision 1.

Signed writing.

A contribution agreement, whether made before or after the formation of the cooperative, is not enforceable against the would-be contributor unless it is in writing and signed by the would-be contributor.

Subd. 2.

Irrevocable period.

Unless otherwise provided in the contribution agreement, or unless all of the would-be contributors and, if in existence, the cooperative, consent to a shorter or longer period, a contribution agreement is irrevocable for a period of six months.

Subd. 3.

Current and deferred payment.

A contribution agreement, whether made before or after the formation of a cooperative, must be paid or performed in full at the time or times, or in the installments, if any, specified in the contribution agreement. In the absence of a provision in the contribution agreement specifying the time at which the contribution is to be paid or performed, the contribution must be paid or performed at the time or times determined by the board, but a call made by the board for payment or performance on contributions must be uniform for all membership interests of the same class or for all membership interests of the same series.

Subd. 4.

Failure to pay remedies.

(a) Unless otherwise provided in the contribution agreement, in the event of default in the payment or performance of an installment or call when due, the cooperative may proceed to collect the amount due in the same manner as a debt due the cooperative. If a would-be contributor does not make a required contribution of property or services, the cooperative shall require the would-be contributor to contribute cash equal to that portion of the value, as stated in the cooperative required records, of the contribution that has not been made.

(b) If the amount due under a contribution agreement remains unpaid for a period of 20 days after written notice of demand for payment has been given to the delinquent would-be contributor, the membership interests that were subject to the contribution agreement may be offered for sale by the cooperative for a price in money equaling or exceeding the sum of the full balance owed by the delinquent would-be contributor plus the expenses incidental to the sale.

If the membership interests that were subject to the contribution agreement are sold according to this paragraph, the cooperative shall pay to the delinquent would-be contributor or to the delinquent would-be contributor's legal representative the lesser of:

(1) the excess of net proceeds realized by the cooperative over the sum of the amount owed by the delinquent would-be contributor plus the expenses incidental to the sale, less any penalty stated in the contribution agreement, which may include forfeiture of the partial contribution; and

(2) the amount actually paid by the delinquent would-be contributor.

If the membership interests that were subject to the contribution agreement are not sold according to this paragraph, the cooperative may collect the amount due in the same manner as a debt due the cooperative or cancel the contribution agreement according to paragraph (c).

(c) If the amount due under a contribution agreement remains unpaid for a period of 20 days after written notice of demand for payment has been given to the delinquent would-be contributor and the membership interests that were subject to the defaulted contribution agreement have not been sold according to paragraph (b), the cooperative may cancel the contribution agreement, the cooperative may retain any portion of the contribution agreement price actually paid as provided in the contribution agreement, and the cooperative shall refund to the delinquent would-be contributor or the delinquent would-be contributor's legal representatives any portion of the contribution agreement price as provided in the contribution agreement.

Subd. 5.

Restrictions on assignment.

Unless otherwise provided in the articles or bylaws, a would-be contributor's rights under a contribution agreement may not be assigned, in whole or in part, to a person who was not a member at the time of the assignment, unless all the members approve the assignment by unanimous written consent.

308C.715 CONTRIBUTION RIGHTS AGREEMENTS.

Subdivision 1.

Agreements permitted.

Subject to any restrictions in the articles or bylaws, a cooperative may enter into contribution rights agreements under the terms, provisions, and conditions fixed by the board.

Subd. 2.

Writing required and terms to be stated.

Any contribution rights agreement must be in writing and the writing must state in full, summarize, or include by reference all the agreement's terms, provisions, and conditions of the rights to make contributions.

Subd. 3.

Restrictions on assignment.

Unless otherwise provided in the articles or bylaws, a would-be contributor's rights under a contribution rights agreement may not be assigned, in whole or in part, to a person who was not a member at the time of the assignment, unless all the members approve the assignment by unanimous written consent.

308C.721 ALLOCATIONS AND DISTRIBUTIONS TO MEMBERS.

Subdivision 1.

Allocation of profits and losses.

If applicable to the specific type of housing cooperative formed under this chapter, the bylaws or operating agreement shall prescribe the allocation of profits and losses between occupant membership interests collectively and any other membership interests. If the bylaws or operating agreement do not otherwise provide, the profits and losses between occupant membership interests collectively and other membership interests shall be allocated on the basis of the value of contributions to capital made by the occupant membership interests collectively and other membership interests and accepted by the cooperative. The allocation of profits to the occupant membership interests collectively shall not be less than 50 percent of the total profits in any fiscal year, except that if authorized in the original articles as filed or in articles or bylaws that are adopted by an affirmative vote of the occupant members or the articles or bylaws are amended by the affirmative vote of the occupant members, the allocation of profits to the occupant membership interests collectively may not be less than 15 percent of the total profits in any fiscal year.

Subd. 2.

Distribution of cash or other assets.

The bylaws or operating agreement shall prescribe the distribution of cash or other assets of the cooperative among the membership interests of the cooperative. If not otherwise provided in the bylaws, distribution shall be made to the occupant membership interests collectively and other members on the basis of the value of contributions to capital made and accepted by the cooperative, by the occupant membership interests collectively, and other membership interests. The distributions to occupant membership interests collectively shall not be less than 50 percent of the total distributions in any fiscal year, except that if authorized in the articles or bylaws adopted by the affirmative vote of the occupant members, or the articles or bylaws are amended by the affirmative vote of the occupant members, the distributions to occupant membership interests collectively shall not be less than 15 percent of the total distributions in any year.

308C.725 ALLOCATIONS AND DISTRIBUTIONS TO OCCUPANT MEMBERS.

Subdivision 1.

Distribution of net income.

A cooperative may set aside a portion of net income allocated to the occupant membership interests as the board determines advisable to create or maintain a capital reserve.

Subd. 2.

Reserves.

In addition to a capital reserve, the board may, for occupant membership interests:

(1) set aside an amount not to exceed five percent of the annual net income of the cooperative for promoting and encouraging cooperative organization; and

(2) establish and accumulate reserves for common area items, buildings, depreciation, losses, and other proper purposes.

Subd. 3.

Occupant distributions.

Any net income allocated to occupant members in excess of dividends on equity and additions to reserves shall be distributed to occupant members on the basis of patronage of cooperative. A cooperative may establish allocation units, whether the units are functional, divisional, departmental, or otherwise and pooling arrangements and may account for and distribute net income to occupants on the basis of allocation units and pooling arrangements. A cooperative may offset the net loss of an allocation unit or pooling arrangement against the net income of other allocation units or pooling arrangements.

Subd. 4.

Frequency of distribution.

Distribution of net income may be made at least annually. The board shall present to the members at their annual meeting a report covering the operations of the cooperative during the preceding fiscal year.

Subd. 5.

Form of distribution.

A cooperative may distribute net income to occupant members in cash, capital credits, allocated patronage equities, revolving fund certificates, or its own or other securities.

308C.805 MERGER OF SUBSIDIARY.

Subdivision 1.

When authorized; contents of plan.

(a) For purposes of this section, "subsidiary" means a domestic cooperative, a Minnesota limited liability company, or a foreign cooperative, and "cooperative" means a domestic cooperative. A Minnesota limited liability company may only participate in a merger under this section to the extent authorized under section 322C.1002. A parent domestic cooperative or a subsidiary that is a domestic cooperative may complete the merger of a subsidiary as provided in this section, provided however, if either the parent or the subsidiary is a business entity organized under the laws of this state, the merger of the subsidiary is not authorized under this section unless the law governing the business entity expressly authorizes merger with a cooperative. A parent cooperative owning at least 90 percent of the outstanding ownership interests of each class and series of a subsidiary directly, or indirectly through related organizations, other than classes or series that, absent this section, would otherwise not be entitled to vote on the merger, may merge the subsidiary into itself or into any other subsidiary at least 90 percent of the outstanding ownership interests of each class and series of which is owned by the parent cooperative directly, or indirectly through related organizations, other than classes or series that, absent this section, would otherwise not be entitled to vote on the merger, without a vote of the members of itself or any subsidiary or may merge itself, or itself and one or more of the subsidiaries, into one of the subsidiaries under this section. A resolution approved by the affirmative vote of a majority of the directors of the parent cooperative present shall set forth a plan of merger that contains:

(1) the name of the subsidiary or subsidiaries, the name of the parent, and the name of the surviving cooperative;

(2) the manner and basis of converting the membership interests of the subsidiary or subsidiaries or parent into securities of the parent, subsidiary, or of another cooperative or, in the whole or in part, into money or other property;

(3) if the parent is a constituent cooperative but is not the surviving cooperative in the merger, a provision for the pro rata issuance of membership interests of the surviving cooperative to the holders of membership interests of the parent on surrender of any certificates for shares of the parent; and

(4) if the surviving cooperative is a subsidiary, a statement of any amendments to the articles of the surviving cooperative that will be part of the merger.

(b) If the parent is a constituent cooperative and the surviving cooperative in the merger, it may change its cooperative name, without a vote of its members, by the inclusion of a provision to that effect in the resolution of merger setting forth the plan of merger that is approved by the affirmative vote of a majority of the directors of the parent present. Upon the effective date of the merger, the name of the parent shall be changed.

(c) If the parent is a constituent cooperative but is not the surviving cooperative in the merger, the resolution is not effective unless it is also approved by the affirmative vote of the holders of a majority of the voting power of all membership interests of the parent entitled to vote at a regular or special meeting if the parent is a cooperative, or in accordance with the laws under which it is organized if the parent is a foreign business entity or cooperative.

Subd. 2.

Notice to members of subsidiary.

Notice of the action, including a copy of the plan of merger, shall be given to each member, other than the parent and any subsidiary of each subsidiary that is a constituent cooperative in the merger before, or within ten days after, the effective date of the merger.

Subd. 3.

Articles of merger; contents of articles.

Articles of merger shall be prepared that contain:

(1) the plan of merger;

(2) the number of outstanding membership interests of each series and class of each subsidiary that is a constituent cooperative in the merger, other than the series or classes that, absent this section, would otherwise not be entitled to vote on the merger, and the number of membership interests of each series and class of the subsidiary or subsidiaries, other than series or classes that, absent this section, would otherwise not be entitled to vote on the merger, owned by the parent directly, or indirectly through related organizations; and

(3) a statement that the plan of merger has been approved by the parent under this section.

Subd. 4.

Articles signed, filed.

The articles of merger shall be signed on behalf of the parent and filed with the secretary of state.

Subd. 5.

Certificate.

The secretary of state shall issue a certificate of merger to the parent or its legal representative or, if the parent is a constituent cooperative but is not the surviving cooperative in the merger, to the surviving cooperative or its legal representative.

Subd. 6.

Nonexclusivity.

A merger among a parent and one or more subsidiaries or among two or more subsidiaries of a parent may be accomplished under section 308C.801 instead of this section, in which case this section does not apply.