(a) A benefit limited liability company shall deliver to each member an annual benefit report including: (1) A description of: (i) The ways in which the benefit limited liability company pursued a general public benefit during the year and the extent to which the general public benefit was created; (ii) The ways in which the benefit limited liability company pursued any specific public benefit that its articles of organization or operating agreement states is the purpose of the benefit limited liability company to create and the extent to which that specific public benefit was created; and (iii) Any circumstances that have hindered the creation by the benefit limited liability company of the public benefit; and (2) An assessment of the societal and environmental performance of the benefit limited liability company prepared in accordance with a third-party standard applied consistently with the prior year's benefit report or accompanied by an explanation of the reasons for any inconsistent application. (b) The benefit report shall be delivered to each member within 120 days following the end of each fiscal year of the benefit limited liability company. (c) (1) A benefit limited liability company shall post its most recent benefit report on the public portion of its website, if any. (2) If a benefit limited liability company does not have a public website, the benefit limited liability company shall provide a copy of its most recent benefit report on demand and without charge to any person who requests a copy. §4A-12A-01. NOT IN EFFECT ** TAKES EFFECT OCTOBER 1, 2026 PER CHAPTERS 198 AND 199 OF 2025 ** (a) In this subtitle the following words have the meanings indicated. (b) "Assembly" means all members of a limited worker cooperative association who have voting rights under this subtitle and the limited worker cooperative association's cooperative agreement. (c) "Collective worker cooperative" means a limited worker cooperative association that has only one class of members consisting of worker members who manage all of the affairs of the association. (d) "Cooperative agreement" means the operating agreement of a limited worker cooperative association. (e) "Foreign worker cooperative" means an entity formed under the laws of a state other than this State that is similar to an entity formed under this subtitle. (f) "Investor member" means a member of a limited worker cooperative association who is not required or permitted to conduct patronage with the association in the member's capacity as an investor member in order to receive or retain the member's interest in the association. (g) "Limited worker cooperative association" means a Maryland limited liability company that elects to be a limited worker cooperative association in accordance with this subtitle. (h) "Patron member" means a member of a limited worker cooperative association who is required or permitted to conduct patronage with the association. (i) "Patronage" means business transactions between a limited worker cooperative association and a person that entitles the person to receive financial rights based on the value or quantity of business between the association and the person. (j) "Representative" means a person serving on the board of representatives of a limited worker cooperative association. (k) "Voting power" means the proportion of total votes entitled to be cast on a matter that are held by a particular member or a group or class of members. (l) "Worker member" means a patron member of a limited worker cooperative association who is a natural person and whose patronage consists of or includes labor contributed to or for the association. §4A-12A-02. NOT IN EFFECT ** TAKES EFFECT OCTOBER 1, 2026 PER CHAPTERS 198 AND 199 OF 2025 ** (a) The provisions of this subtitle apply to limited worker cooperative associations except to the extent that: (1) The context of a provision clearly requires otherwise; or (2) A specific provision of this title provides otherwise. (b) This subtitle applies only to a limited worker cooperative association. (c) (1) The existence of this subtitle does not of itself create any implication that a contrary or different rule of law is or would be applicable to a limited liability company that is not a limited worker cooperative association. (2) This subtitle does not affect any statute or rule of law as it applies to a limited liability company that is not a limited worker cooperative association. (d) A provision of the articles of organization or cooperative agreement of a limited worker cooperative association may not be inconsistent with any provision of this subtitle. §4A-12A-03. NOT IN EFFECT ** TAKES EFFECT OCTOBER 1, 2026 PER CHAPTERS 198 AND 199 OF 2025 ** Unless otherwise provided in this subtitle, the policy of this subtitle is to give maximum effect to the principle of democratic self-management of a limited worker cooperative association by its worker members. §4A-12A-04. NOT IN EFFECT ** TAKES EFFECT OCTOBER 1, 2026 PER CHAPTERS 198 AND 199 OF 2025 ** (a) A limited liability company may elect to be a limited worker cooperative association under this subtitle by including in its articles of organization a statement that the limited liability company is a limited worker cooperative association. (b) A limited liability company that has elected to be a limited worker cooperative association may further elect to be a collective worker cooperative by including in its articles of organization a statement that it is a collective worker cooperative. (c) Unless the limited worker cooperative association has elected to be a collective worker cooperative, the articles of organization of a limited worker cooperative association shall include the names of those individuals who will serve as representatives until their successors are elected and qualify. (d) The name of a limited worker cooperative association shall comply with the requirements of Title 1, Subtitle 5 of this article. §4A-12A-05. NOT IN EFFECT ** TAKES EFFECT OCTOBER 1, 2026 PER CHAPTERS 198 AND 199 OF 2025 ** (a) This section does not apply to a collective worker cooperative. (b) After a limited worker cooperative association is formed: (1) If initial representatives are named in the articles of organization, the initial representatives shall hold an organizational meeting to adopt the cooperative agreement and carry on any other business necessary or proper to complete the organization of the association; or (2) If initial representatives are not named in the articles of organization, the person who has caused the articles to be executed and filed for record shall designate the initial representatives and call a meeting of the initial representatives to adopt an initial cooperative agreement and carry out any other business necessary and proper to complete the organization of the association. (c) Unless provided otherwise in the articles of organization, the initial representatives may cause the limited worker cooperative association to accept members. (d) Initial representatives of a limited worker cooperative association need not be members of the association. (e) An initial representative serves until: (1) A successor is elected and qualifies at an assembly meeting; or (2) The representative is removed. §4A-12A-06. NOT IN EFFECT ** TAKES EFFECT OCTOBER 1, 2026 PER CHAPTERS 198 AND 199 OF 2025 ** After a collective worker cooperative is formed, the initial worker members shall hold an organizational meeting to adopt the cooperative agreement and conduct any other business necessary or proper to complete the organization of the collective worker cooperative. §4A-12A-07. NOT IN EFFECT ** TAKES EFFECT OCTOBER 1, 2026 PER CHAPTERS 198 AND 199 OF 2025 ** Clear reference to the fact that a limited liability company is a limited worker cooperative association shall appear prominently: (1) At the head of the articles of organization or an amendment made to the articles of organization in which the election to be a limited worker cooperative association is made; (2) At the head of each subsequent articles of organization of the limited worker cooperative association; and (3) On each certificate representing outstanding membership interests in the limited worker cooperative association. §4A-12A-08. NOT IN EFFECT ** TAKES EFFECT OCTOBER 1, 2026 PER CHAPTERS 198 AND 199 OF 2025 ** (a) Subject to subsection (b) of this section, a limited worker cooperative association may terminate its status as a limited worker cooperative association by amending its articles of organization to delete the statements required by § 4A-12A- 04 of this subtitle. (b) Any termination of a limited worker cooperative association's status shall be subject to the approval of two-thirds of the voting power of worker members and two-thirds of all members entitled to vote on the matter. §4A-12A-09. NOT IN EFFECT ** TAKES EFFECT OCTOBER 1, 2026 PER CHAPTERS 198 AND 199 OF 2025 ** (a) The cooperative agreement of a limited worker cooperative association shall include: (1) A statement of the capital structure of the association; (2) The classes or other types of membership interests and relative rights, preferences, and restrictions granted to or imposed on each class or other type of membership interest, including: (i) A statement concerning: 1. The manner in which profits and losses are allocated and distributions are made among members; and 2. If investor members are authorized, the manner in which profits and losses are allocated and distributions are made among investor members; and (ii) A statement designating voting and other governance rights of each class or other type of membership interest, including which members have voting power and any restrictions on voting power; (3) A statement of the method of admission of members; (4) A statement that a membership interest is transferable, if it is to be transferable, and a statement of the conditions under which it may be transferred; (5) A statement concerning whether and how persons that are not members but conduct business with the association may be allowed to share in allocations of profits and losses and receive distributions; (6) A statement of the number and terms of representatives or the method by which the number and terms are determined; (7) A statement addressing members' contributions; and (8) A statement on whether the limited worker cooperative association will elect to be taxed as a partnership or a corporation for federal and State income tax purposes that includes an explanation of the tax implications of the election for the worker members. (b) The cooperative agreement of a limited worker cooperative association may contain any provision for managing and regulating the affairs of the association not inconsistent with its articles of organization or this title. (c) A person that becomes a member of a limited worker cooperative association is deemed to assent to the cooperative agreement of the association. (d) The cooperative agreement of a limited worker cooperative association may be entered into before, after, or at the time of filing of articles of organization and may be made effective as of: (1) The time of formation of the association; or (2) The time or date provided in the cooperative agreement. §4A-12A-10. NOT IN EFFECT ** TAKES EFFECT OCTOBER 1, 2026 PER CHAPTERS 198 AND 199 OF 2025 ** (a) A limited worker cooperative association may include multiple classes of members whose rights and membership interests shall be determined by the cooperative agreement. (b) To begin business, a limited worker cooperative association must have at least three worker members unless the sole member is a limited worker cooperative association. (c) A person becomes a member of a limited worker cooperative association: (1) As provided in the articles of organization or cooperative agreement; (2) As the result of a merger under Subtitle 7 of this title; (3) As a result of a conversion under this article, in which another entity elects to be a limited worker cooperative association under this subtitle; or (4) With the consent of all of the worker members. (d) A member may not act for or bind the limited worker cooperative association solely by reason of being a member. (e) Unless the articles of organization provide otherwise, a debt, an obligation, or any other liability of a limited worker cooperative association is solely that of the association and is not the debt, obligation, or liability of a member. (f) (1) The organization of a limited worker cooperative association under this subtitle does not create a presumption that worker members are employees of the association for any purpose. (2) If a limited worker cooperative association is taxed as a partnership for federal and State income tax purposes, that fact may not be construed to require that a worker member be considered an employee under any State law. §4A-12A-11. NOT IN EFFECT ** TAKES EFFECT OCTOBER 1, 2026 PER CHAPTERS 198 AND 199 OF 2025 ** (a) In this section, "actual payroll value" means the total amount of money paid to an employee after taxes and deductions and includes the base salary, bonuses, overtime, leave benefits, commissions, and tips. (b) An insurer, as defined in § 1-101 of the Insurance Article, that provides workers' compensation insurance to members of a limited worker cooperative association formed under this subtitle shall calculate premiums for members who are covered employees: (1) In accordance with Title 11, Subtitle 3 and Title 19, Subtitle 4 of the Insurance Article; and (2) Based on the covered employee's actual payroll value. (c) The Maryland Insurance Commissioner shall enforce this section. (d) This section may not be construed to prohibit a limited worker cooperative association from acquiring other forms of insurance. §4A-12A-12. NOT IN EFFECT ** TAKES EFFECT OCTOBER 1, 2026 PER CHAPTERS 198 AND 199 OF 2025 ** (a) A limited worker cooperative association shall have an assembly as constituted by the body of all voting members. (b) An individual is not an agent of a limited worker cooperative association solely by being a member of the assembly. (c) A debt, an obligation, or any other liability of a limited worker cooperative association is solely that of the association and is not a debt, an obligation, or a liability of a member of the assembly solely by reason of being a voting member. §4A-12A-13. NOT IN EFFECT ** TAKES EFFECT OCTOBER 1, 2026 PER CHAPTERS 198 AND 199 OF 2025 ** (a) The assembly shall meet annually at a time: (1) Provided in the articles of organization or cooperative agreement; or (2) Set by the board of representatives that is consistent with the articles of organization or cooperative agreement. (b) Except as otherwise provided in the cooperative agreement, members may attend or conduct the annual assembly meeting through any means of communication if all members attending the meeting are able to communicate with each other during the meeting. (c) The board of representatives shall report, or cause to be reported, at the annual assembly meeting the association's business and financial condition as of the close of the most recent fiscal year. (d) Except as otherwise provided in the cooperative agreement, the board of representatives shall designate the presiding officer of the annual assembly meeting. (e) Failure to hold an annual assembly meeting does not affect the validity of any action taken by the limited worker cooperative association. (f) (1) Subject to paragraph (2) of this subsection, a limited worker cooperative association shall notify each member of the time, date, and place of a meeting of the members at least 10 and not more than 60 days before the annual assembly meeting. (2) If the notice is of a meeting of the members in one or more classes of members, the notice shall be given only to members in those classes. §4A-12A-14. NOT IN EFFECT ** TAKES EFFECT OCTOBER 1, 2026 PER CHAPTERS 198 AND 199 OF 2025 ** (a) (1) A special meeting of the assembly may be called only: (i) As provided for in the cooperative agreement; (ii) By a majority of votes of the board of representatives on a proposal stating the purpose of the special meeting; or (iii) By demand in a record signed by members holding at least 20% of the voting power of the persons entitled to vote on the matter that is the purpose of the special meeting. (2) A demand under paragraph (1)(iii) of this subsection shall be submitted to: (i) The officer of the limited worker cooperative association charged with keeping the records of the association; or (ii) If no officer has been charged with keeping the records of the association, a representative. (3) Any voting member may withdraw the member's demand under paragraph (1)(iii) of this subsection before receipt by the limited worker cooperative association of demands sufficient to require a special meeting of the assembly. (b) Except as otherwise provided in the cooperative agreement, members may attend or conduct the special assembly meeting through any means of communication if all members attending the meeting are able to communicate with each other during the meeting. (c) Only business within the purposes stated in the notice of special meeting may be conducted at the meeting. (d) Except as otherwise provided in the cooperative agreement, the presiding officer of a special meeting shall be designated by the board of representatives. §4A-12A-15. NOT IN EFFECT ** TAKES EFFECT OCTOBER 1, 2026 PER CHAPTERS 198 AND 199 OF 2025 ** (a) The articles of organization or cooperative agreement may allocate voting power among members on the basis of one or more of the following: (1) One member, one vote; (2) If a member is a cooperative, the number of its members; or (3) Subject to subsection (b) of this section, use or patronage. (b) If voting power is allocated on the basis of use or patronage and a worker member would be denied a vote because the worker member did not use the limited worker cooperative association or conduct patronage with it, the worker member shall be allocated a vote equal to at least the minimum voting power allocated to worker members who used the association or conducted patronage with it. (c) The articles of organization or cooperative agreement may provide for the allocation of member voting power by class. (d) Investor members are not entitled to vote unless the articles of organization or cooperative agreement provides otherwise. (e) (1) This subsection does not apply where this title or the articles of organization or cooperative agreement require a higher voting threshold than is required by paragraph (2) of this subsection. (2) Notwithstanding any provision of the articles of organization or cooperative agreement, all representatives shall be elected and all other decisions within the authority of the assembly shall be made by a majority vote of: (i) The worker members of the association; and (ii) The voting power of members entitled to vote on the election or decision. §4A-12A-16. NOT IN EFFECT ** TAKES EFFECT OCTOBER 1, 2026 PER CHAPTERS 198 AND 199 OF 2025 ** (a) This section does not apply to a collective worker cooperative. (b) A limited worker cooperative association shall have a board of representatives consisting of at least three individuals. (c) (1) The affairs of a limited worker cooperative association shall be managed by the board of representatives or individuals to whom the board delegates such duties. (2) The board of representatives may adopt policies and procedures consistent with the articles of organization, the cooperative agreement, or this title. (d) An individual is not an agent of a limited worker cooperative association solely by being a representative. (e) A debt, an obligation, or any other liability of a limited worker cooperative association is solely that of the association and is not a debt, an obligation, or a liability of a representative solely by reason of being a representative. (f) Representatives shall be elected for terms determined by the cooperative agreement. §4A-12A-17. NOT IN EFFECT ** TAKES EFFECT OCTOBER 1, 2026 PER CHAPTERS 198 AND 199 OF 2025 ** (a) A limited worker cooperative association is dissolved and shall commence the winding up of its affairs on the first to occur of the following: (1) At the time or on the happening of the events specified in the articles of organization or the cooperative agreement; (2) Unless a higher threshold is stated in the cooperative agreement, at the time specified by: (i) A two-thirds vote of the worker members; and (ii) A two-thirds vote of the voting power of all members of the assembly; (3) At the time of the entry of a decree of judicial dissolution under § 4A-903 of this title; or (4) Unless otherwise agreed or as provided in subsection (b) of this section, at the time the limited worker cooperative association has had no members for a period of 90 consecutive days. (b) (1) A limited worker cooperative association may not be dissolved or required to wind up its affairs if within 90 days after there are no remaining members of the limited worker cooperative association or within the period of time provided in the cooperative agreement: (i) The last remaining member's successor or assignee agrees in writing to continue the limited worker cooperative association and to be admitted as a member or to appoint a designee as a member to be effective as of the time the last remaining member ceased to be a member; or (ii) A member is admitted to the limited worker cooperative association in the manner set forth in the cooperative agreement to be effective as of the time the last remaining member ceased to be a member under a provision in the cooperative agreement that provides for the admission of a member after there are no remaining members. (2) If a new member is not admitted to the limited worker cooperative association in accordance with paragraph (1) of this subsection, and the last remaining member ceased to be a member under § 4A-606(5) of this title, the last remaining member's personal representative or guardian shall automatically be admitted as a new member of the limited worker cooperative association, effective immediately on the happening of the event described in § 4A-606(5) of this title, unless within 90 days after the personal representative or guardian first has knowledge of the event, the personal representative or guardian: (i) Renounces that admission in writing; or (ii) Designates a person to become a new member, and the designee accepts the designee's admission in writing or by electronic communication to the personal representative or guardian. (c) A cooperative agreement may provide that the last remaining member's personal representative, guardian, successor, or assignee shall be obligated to agree in writing to continue the limited liability company and to be admitted as a member or to appoint a designee as a member to be effective as of the time the last remaining member ceased to be a member. (d) Unless otherwise agreed and subject to the provisions of subsections (a)(4) and (b) of this section, the termination of a person's membership may not cause a limited worker cooperative association to be dissolved or to wind up its affairs and the limited worker cooperative association shall continue in existence following the termination of a person's membership. §4A-12A-18. NOT IN EFFECT ** TAKES EFFECT OCTOBER 1, 2026 PER CHAPTERS 198 AND 199 OF 2025 ** If a member dies, the deceased member's personal representative may exercise, for the purpose of settling the estate, the rights the deceased member was entitled to under § 4A-406 of this title. §4A-12A-19. NOT IN EFFECT ** TAKES EFFECT OCTOBER 1, 2026 PER CHAPTERS 198 AND 199 OF 2025 ** (a) (1) Except as provided in paragraph (2) of this subsection, the profits and losses of a limited worker cooperative association shall be apportioned and distributed in the manner specified by the articles of organization or cooperative agreement. (2) Profits declared as patronage allocations with respect to a period of time and paid or credited to patron members shall be apportioned among the patron members in accordance with the ratio of each patron member's patronage during the applicable time period to the total patronage by all patron members during that period. (b) The apportionment, distribution, and payment of net earnings of the limited worker cooperative association may be in cash, credits, or written notices of allocation issued by the association. §4A-12A-20. NOT IN EFFECT ** TAKES EFFECT OCTOBER 1, 2026 PER CHAPTERS 198 AND 199 OF 2025 ** (a) A limited worker cooperative association may establish, through the articles of organization or cooperative agreement, a system of internal capital accounts to reflect the book value and to determine the redemption price of membership interests and written notices of allocation. (b) The articles of organization or cooperative agreement: (1) May allow the periodic redemption of written notices of allocation; and (2) Shall provide for recall and redemption of membership interests on termination of membership in the limited worker cooperative association. (c) (1) A limited worker cooperative association may allocate a portion of retained net earnings and net losses to a collective reserve account. (2) Earnings of a limited worker cooperative association assigned to a collective reserve account may be used for any purpose determined by: (i) In the case of a collective worker cooperative, the members; or (ii) In the case of a limited worker cooperative association other than a collective worker cooperative, the board of representatives. §4A-12A-21. NOT IN EFFECT ** TAKES EFFECT OCTOBER 1, 2026 PER CHAPTERS 198 AND 199 OF 2025 ** (a) Any membership interest, patronage refund, per unit retain certificate, equity instrument, or evidence of membership interest issued, offered, or sold by a limited worker cooperative association is exempt from the registration requirements of Title 11 of this article. (b) Any membership interest, patronage refund, per unit retain certificate, equity instrument, or evidence of membership interest may be lawfully offered and sold by the issuer or its members, representatives, or salaried employees without the necessity of being registered as a broker or dealer under Title 11 of this article. §4A-12A-22. NOT IN EFFECT ** TAKES EFFECT OCTOBER 1, 2026 PER CHAPTERS 198 AND 199 OF 2025 ** A foreign worker cooperative may register and do business in the State subject to and in accordance with the provisions of Subtitle 10 of this title.
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