NRS: CHAPTER 81 - MISCELLANEOUS ORGANIZATIONS

[Rev. 6/29/2024 2:53:23 PM--2023]

CHAPTER 81 - MISCELLANEOUS ORGANIZATIONS

GENERAL PROVISIONS

NRS 81.0026 Prohibition against formation of entity for certain illegal purposes.

NRS 81.0027 Form required for filing of records.

NRS 81.003 Filing of records written in language other than English.

NRS 81.006 Correction of inaccurate or defective record filed with Secretary of State; cancellation of filings.

NRS 81.0065 Secretary of State authorized to adopt certain regulations to allow entities to carry out powers and duties through most recent technology.

NONPROFIT COOPERATIVE CORPORATIONS

NRS 81.010 Formation; applicable law; revival of certain expired corporations.

NRS 81.020 Capital stock; purpose; voting power of members; meetings; dividends; dealing in products of nonmembers; distribution of surplus funds or issuance of refunds to members.

NRS 81.030 Memberships: Certificates; transfer and assignment.

NRS 81.040 Articles of incorporation: Required provisions.

NRS 81.050 Articles of incorporation: Optional provisions.

NRS 81.055 Articles of incorporation: Prohibited names and businesses; certification required before filing of certain articles or amendments; defaulting corporations.

NRS 81.060 Articles of incorporation: Filing requirements; acceptable evidence of incorporation.

NRS 81.070 Amendment of articles of incorporation.

NRS 81.080 Bylaws: Adoption; amendment; effectiveness.

NRS 81.090 Bylaws: Optional provisions.

NRS 81.100 Bylaws: Provisions for unequal property rights.

NRS 81.110 General powers.

NRS 81.120 Marketing contracts: Powers of corporation; title to property.

NRS 81.130 Consolidation of cooperative corporations: Procedure; powers.

NRS 81.150 Right of corporation to do business: Quo warranto proceedings.

NRS 81.160 Applicability of NRS 81.010 to 81.160, inclusive.

COOPERATIVE ASSOCIATIONS

NRS 81.170 “Lawful business” defined; construction of NRS 81.170 to 81.270, inclusive.

NRS 81.175 Applicable law.

NRS 81.180 Formation of cooperative association: No capital stock; issuance of membership certificates.

NRS 81.190 Members: Qualifications, rights, interest and duties.

NRS 81.200 Articles of association: Filing requirements; required provisions.

NRS 81.205 Articles of association: Prohibited names and businesses; certification required before filing of certain articles or amendments; defaulting associations.

NRS 81.210 Purpose of business may be changed; amendment of articles.

NRS 81.220 General powers.

NRS 81.230 Bylaws: Adoption; amendment; required and optional provisions.

NRS 81.240 Bylaws: Required and optional provisions concerning profits.

NRS 81.250 Recording and maintaining of bylaws and amendments.

NRS 81.260 Association’s property subject to execution; member’s interest sold upon execution; rights of purchaser.

NRS 81.270 Succession to membership: Nomination and transfer on death.

NONPROFIT COOPERATIVE CORPORATIONS WITHOUT STOCK

NRS 81.410 Formation; applicable law.

NRS 81.420 No capital stock; not to be carried on for profit.

NRS 81.430 Memberships: Certificates; transfer and assignment.

NRS 81.440 Articles of incorporation: Required provisions.

NRS 81.445 Articles of incorporation: Prohibited names and businesses; certification required before filing of certain articles or amendments; defaulting corporations.

NRS 81.450 Articles of incorporation: Filing requirements; acceptable evidence of incorporation.

NRS 81.470 Bylaws: Adoption; amendment; effectiveness.

NRS 81.480 Bylaws: Optional provisions.

NRS 81.490 Bylaws: Provisions for unequal voting power.

NRS 81.500 General powers.

NRS 81.505 Restriction on power of rural electric cooperatives to sell, lease or dispose of assets.

NRS 81.507 Reversion of unclaimed capital credit to electric cooperative under certain circumstances.

NRS 81.510 Agreements for unified action by cooperative corporations.

NRS 81.540 Applicability and effect of NRS 81.410 to 81.540, inclusive.

CHARITABLE ORGANIZATIONS

NRS 81.550 Short title.

NRS 81.560 Declaration of policy.

NRS 81.570 References to Internal Revenue Code.

NRS 81.580 Definitions.

NRS 81.600 “Director” defined.

NRS 81.605 “Governing instrument” defined.

NRS 81.610 “Private foundation” defined.

NRS 81.620 Applicability of NRS 81.550 to 81.660, inclusive.

NRS 81.630 Prohibited acts.

NRS 81.640 Minimum distributions required.

NRS 81.650 Amendment of governing instrument: Procedure.

NRS 81.660 Amendment of governing instrument: Provision for termination of status of private foundation.

UNINCORPORATED NONPROFIT ASSOCIATIONS (UNIFORM ACT)

General Provisions

NRS 81.700 Short title.

NRS 81.705 Definitions.

NRS 81.710 “Established practices” defined.

NRS 81.715 “Governing principles” defined.

NRS 81.720 “Manager” defined.

NRS 81.725 “Member” defined.

NRS 81.730 “Person” defined.

NRS 81.735 “State” defined.

NRS 81.740 “Unincorporated nonprofit association” defined.

NRS 81.745 Relation to other law.

NRS 81.750 Governing law.

Nature and Powers

NRS 81.755 Legal entity; perpetual existence; powers.

NRS 81.760 Ownership and transfer of property.

NRS 81.765 Statement of authority as to real property.

NRS 81.770 Liability.

NRS 81.775 Assertion and defense of claims.

NRS 81.780 Effect of judgment or order.

NRS 81.785 Appointment of agent to receive service of process; service of process.

NRS 81.790 Action or proceeding not abated by change in members or managers.

NRS 81.795 Venue.

Members and Managers

NRS 81.800 Member not agent.

NRS 81.805 Certain actions require approval by members.

NRS 81.810 Meetings of members: Voting, notice and quorum requirements.

NRS 81.815 Duties of member.

NRS 81.820 Admission, suspension, dismissal or expulsion of members.

NRS 81.825 Resignation of member.

NRS 81.830 Membership interest not transferable.

NRS 81.835 Selection of managers; management rights of managers.

NRS 81.840 Duties of managers.

NRS 81.845 Meetings of managers: Notice and quorum requirements.

NRS 81.850 Right of member or manager to information.

NRS 81.855 Distributions prohibited; compensation and other permitted payments.

NRS 81.860 Reimbursement; indemnification; advancement of expenses.

Termination and Mergers

NRS 81.865 Dissolution.

NRS 81.870 Winding up and termination.

NRS 81.875 Mergers.

Miscellaneous Provisions

NRS 81.880 Transition concerning real and personal property.

NRS 81.885 Uniformity of application and construction.

NRS 81.890 Relations to Electronic Signatures in Global and National Commerce Act.

WORKER COOPERATIVE CORPORATIONS

General Provisions

NRS 81.901 Definitions.

NRS 81.903 “Member” defined.

NRS 81.905 “Membership share” defined.

NRS 81.907 “Patronage” defined.

NRS 81.909 “Patronage dividend” defined.

NRS 81.911 “Quorum” defined.

NRS 81.913 “Worker cooperative” defined.

NRS 81.915 “Written notice of allocation” defined.

NRS 81.917 Legislative findings and declarations.

Formation and Operation

NRS 81.919 Election of corporation to be governed as worker cooperative; applicable law.

NRS 81.921 Apportionment and distribution of net earnings and losses.

NRS 81.923 Use of internal capital and collective reserve accounts; redemption of corporate shares and written notices of allocation; recall and redemption of membership shares.

NRS 81.925 Reserve accounts; allocation of indivisible reserve account upon dissolution or sale.

NRS 81.927 Authority to operate as internal capital account cooperative; accounts.

Members and Directors

NRS 81.929 Membership: Establishment of qualifications and method of acceptance, expulsion, termination and suspension; composition of members; effect of leave of absence; rights and responsibilities of members.

NRS 81.931 Board of directors: Composition; annual meeting with members; authority of members to override decisions; considerations when exercising powers.

NRS 81.933 Membership shares; voting power of shares other than membership shares.

NRS 81.935 Procedure for expulsion, termination or suspension of member.

NRS 81.937 Action challenging expulsion, termination or suspension of member.

Meetings

NRS 81.939 Notice of meeting at which members are required or permitted to vote; notice of special meeting.

NRS 81.941 Personal notice of meeting consisting only of members; authority to veto decision made at meeting for which notice was not received.

NRS 81.943 Contents of notice.

NRS 81.945 Means of providing notice; affidavit is prima facie evidence of proper notice.

NRS 81.947 Address of notice to last known address in records; notice if no known address in records; notice if mailed notice is returned as undeliverable.

NRS 81.949 Electronic notice of meeting not authorized in certain circumstances.

NRS 81.951 Meetings adjourned to another time or place.

NRS 81.953 Validity of business transacted at meeting that does not meet notice requirements; waivers of notice.

NRS 81.955 Use of written ballots.

Revocation of Election and Mergers

NRS 81.957 Revocation of election to be governed as worker cooperative.

NRS 81.959 Consolidation or merger.

_________

GENERAL PROVISIONS

NRS 81.0026 Prohibition against formation of entity for certain illegal purposes. A person shall not form an entity pursuant to this chapter for any illegal purpose or with the fraudulent intent to conceal any business activity, or lack thereof, from another person or a governmental agency.

(Added to NRS by 2013, 849)

NRS 81.0027 Form required for filing of records.

1. Each record filed with the Secretary of State pursuant to this chapter must be on or accompanied by a form prescribed by the Secretary of State.

2. The Secretary of State may refuse to file a record which does not comply with subsection 1 or which does not contain all of the information required by statute for filing the record.

3. If the provisions of the form prescribed by the Secretary of State conflict with the provisions of any record that is submitted for filing with the form:

(a) The provisions of the form control for all purposes with respect to the information that is required by statute to appear in the record in order for the record to be filed; and

(b) Unless otherwise provided in the record, the provisions of the record control in every other situation.

4. The Secretary of State may by regulation provide for the electronic filing of records with the Office of the Secretary of State.

(Added to NRS by 2003, 20th Special Session, 48)

NRS 81.003 Filing of records written in language other than English. No record which is written in a language other than English may be filed or submitted for filing in the Office of the Secretary of State pursuant to the provisions of this chapter unless it is accompanied by a verified translation of that record into the English language.

(Added to NRS by 1995, 1120; A 2003, 3117)

NRS 81.006 Correction of inaccurate or defective record filed with Secretary of State; cancellation of filings.

1. A nonprofit cooperative corporation, a cooperative association, a charitable organization or any other entity formed under the provisions of this chapter may correct a record filed with the Secretary of State with respect to the entity if the record contains an inaccurate description of an action or if the record was defectively signed, attested, sealed, verified or acknowledged, including, without limitation, if the record was filed erroneously.

2. To correct a record, the entity must:

(a) Prepare a certificate of correction which:

(1) States the name of the entity;

(2) Describes the record, including, without limitation, its filing date;

(3) Specifies the inaccuracy or defect in the record, including, without limitation, if and to the extent applicable, the error in the filing of the record;

(4) Sets forth such information as is necessary so as to clarify or otherwise remedy the inaccuracy or defect; and

(5) Is signed by an officer of the entity or, if the certificate is filed before the first meeting of the board of directors, by an incorporator or director, or by some other person specifically authorized by the entity to sign the certificate.

(b) Deliver the certificate to the Secretary of State for filing.

3. A certificate of correction is effective on the effective date of the record it corrects except as to persons relying on the uncorrected record and adversely affected by the correction. As to those persons, the certificate is effective when filed.

4. If a nonprofit cooperative corporation, a cooperative association, a charitable organization or any other entity formed under the provisions of this chapter has made a filing with the Secretary of State and the Secretary of State has not processed the filing and placed the filing into the public record, the nonprofit cooperative corporation, cooperative association, charitable organization or other entity may cancel the filing by:

(a) Filing a statement of cancellation with the Secretary of State; and

(b) Paying a fee of $50.

(Added to NRS by 2003, 20th Special Session, 48; A 2009, 2832; 2013, 849; 2023, 375)

NRS 81.0065 Secretary of State authorized to adopt certain regulations to allow entities to carry out powers and duties through most recent technology. The Secretary of State may adopt regulations to define, for the purposes of certain provisions of this chapter, the terms “meeting,” “writing,” “written” and other terms to allow a corporation, association, organization or other entity which is subject to the provisions of this chapter to carry out its powers and duties as prescribed by this chapter through the use of the most recent technology available including, without limitation, the use of electronic communications, videoconferencing, telecommunications and blockchains.

(Added to NRS by 2011, 777; A 2019, 2822)

NONPROFIT COOPERATIVE CORPORATIONS

NRS 81.010 Formation; applicable law; revival of certain expired corporations.

1. Nonprofit cooperative corporations may be formed by the voluntary association of any three or more persons in the manner prescribed in NRS 81.010 to 81.160, inclusive. A majority of the persons must be residents of this State, and such a corporation has and may exercise the powers necessarily incident thereto. Except as otherwise provided in subsection 2, the provisions of chapter 78 of NRS govern each nonprofit cooperative corporation organized pursuant to NRS 81.010 to 81.160, inclusive. If such a nonprofit cooperative corporation is organized without shares of stock, the members shall be deemed to be “shareholders” or “stockholders” as these terms are used in chapter 78 of NRS.

2. If the term for which a nonprofit cooperative corporation was to exist has expired but the corporation has continued to perform the activities authorized by its original articles of incorporation or any amendment thereto, revival of its corporate existence does not require the consent of its members or stockholders. Each required action to accomplish a revival may be taken by a majority of the surviving directors. The revival is effective as of the date of expiration of the original term.

[1:236:1921; NCL § 1575]—(NRS A 1991, 1246; 1997, 709; 2005, 2255, 2625)

NRS 81.020 Capital stock; purpose; voting power of members; meetings; dividends; dealing in products of nonmembers; distribution of surplus funds or issuance of refunds to members.

1. The corporation may or may not have capital stock, and its business must be operated for the mutual benefit of the members thereof.

2. No member of the cooperative corporation may have more than one vote in the management of its affairs. Meetings of the association or meetings of the board of directors may be held in or outside this State.

3. The corporation shall not pay dividends on stock or membership certificates in excess of 8 percent per annum.

4. The corporation or association, as it may be called, may deal in the products of nonmembers, but not to an amount greater in value than such as are handled by it for members, unless otherwise provided in its articles of incorporation or bylaws.

5. Nothing contained in this section shall be construed to prohibit the corporation from distributing surplus funds or issuing refunds to its members in accordance with its articles of incorporation.

[Part 2:236:1921; A 1931, 199; 1931 NCL § 1576]—(NRS A 1993, 987; 2013, 772)

NRS 81.030 Memberships: Certificates; transfer and assignment.

1. Any person or any number of persons, including and in addition to the original incorporators, may become members of the corporation upon such terms and conditions as to membership, and subject to such rules and regulations as to their, and each of their, contract and other rights and liabilities between it and the member, as the corporation shall prescribe in its bylaws.

2. The corporation shall issue a certificate of membership to each member, but the membership or the certificate thereof shall not, except as provided in NRS 81.010 to 81.160, inclusive, be assigned by any member to any other person, nor shall the assigns thereof be entitled to membership in the corporation, or to any property rights or interest therein.

3. The board of directors may, however, by motion duly adopted by it, consent to such assignment or transfer, and to the acceptance of the assignee or transferee as a member of the corporation.

4. The corporation shall also have the right, by its bylaws, to provide for or against the transfer of membership and for or against the assignment of membership certificates, and also the terms and conditions upon which any such transfer or assignment shall be allowed.

[Part 2:236:1921; A 1931, 199; 1931 NCL § 1576]

NRS 81.040 Articles of incorporation: Required provisions. Each corporation formed under NRS 81.010 to 81.160, inclusive, must prepare and file articles of incorporation in writing, setting forth:

1. The name of the corporation, which must contain the word “Cooperative” or “Co-op” or the abbreviation “N.C.C.”

2. The purpose for which it is formed.

3. The information required pursuant to NRS 77.310.

4. The term for which it is to exist, which may be perpetual.

5. If formed with stock, the amount of its stock and the number and par value, if any, and the shares into which it is divided, and the amount of common and of preferred stock that may be issued with the preferences, privileges, voting rights, restrictions and qualifications pertaining thereto.

6. The names and addresses of those selected to act as directors, not less than three, for the first year or until their successors have been elected and have accepted office.

7. Whether the property rights and interest of each member are equal or unequal, and if unequal the articles must set forth a general rule applicable to all members by which the property rights and interests of each member may be determined, but the corporation may admit new members who may vote and share in the property of the corporation with the old members, in accordance with the general rule.

8. The name and mailing or street address, either residence or business, of each of the incorporators signing the articles of incorporation.

[Part 3:236:1921; A 1933, 264; 1941, 329; 1949, 635; 1943 NCL § 1577]—(NRS A 1971, 146; 1985, 32; 1991, 1246; 1993, 987; 1995, 2103; 2003, 3117; 2007, 2656; 2013, 772)

NRS 81.050 Articles of incorporation: Optional provisions. In addition to the requirements of NRS 81.040, the articles of incorporation of any association incorporated under NRS 81.010 to 81.160, inclusive, may contain any provision consistent with law with respect to:

1. Management, regulation, government, financing, indebtedness, membership, establishing of voting districts, voting powers and election of delegates for representative purposes.

2. Issuance, retirement and transfer of its stock, if formed with capital stock.

3. The way or manner in which it shall operate.

4. Its members, officers or directors.

5. Its affairs.

[Part 3:236:1921; A 1933, 264; 1941, 329; 1949, 635; 1943 NCL § 1577]

NRS 81.055 Articles of incorporation: Prohibited names and businesses; certification required before filing of certain articles or amendments; defaulting corporations.

1. The Secretary of State shall not accept for filing any articles of incorporation or any certificate of amendment of articles of incorporation of any corporation formed under the provisions of NRS 81.010 to 81.160, inclusive, which provides that the name of the corporation contains the words “common-interest community,” “community association,” “master association,” “unit-owners’ association” or “homeowners’ association” or if it appears in the articles of incorporation or certificate of amendment of articles of incorporation that the purpose of the corporation is to operate as a unit-owners’ association pursuant to chapter 116 or 116B of NRS unless the Administrator of the Real Estate Division of the Department of Business and Industry certifies that the corporation has:

(a) Registered with the Ombudsman for Owners in Common-Interest Communities and Condominium Hotels pursuant to NRS 116.31158 or 116B.625; and

(b) Paid to the Administrator of the Real Estate Division the fees required pursuant to NRS 116.31155 and 116B.620.

2. Upon notification from the Administrator of the Real Estate Division of the Department of Business and Industry that a corporation which is a unit-owners’ association as defined in NRS 116.011 or 116B.030 has failed to register pursuant to NRS 116.31158 or 116B.625 or failed to pay the fees pursuant to NRS 116.31155 or 116B.620, the Secretary of State shall deem the corporation to be in default. If, after the corporation is deemed to be in default, the Administrator notifies the Secretary of State that the corporation has registered pursuant to NRS 116.31158 or 116B.625 and paid the fees pursuant to NRS 116.31155 or 116B.620, the Secretary of State shall reinstate the corporation if the corporation complies with the requirements for reinstatement as provided in this section and NRS 78.180 and 78.185.

(Added to NRS by 2005, 2253, 2624; A 2007, 2281)

NRS 81.060 Articles of incorporation: Filing requirements; acceptable evidence of incorporation.

1. The articles of incorporation must be:

(a) Signed by three or more of the original members, a majority of whom must be residents of this State.

(b) Filed in the Office of the Secretary of State in all respects in the same manner as other articles of incorporation are filed.

2. If a corporation formed under NRS 81.010 to 81.160, inclusive, is authorized to issue stock, there must be paid to the Secretary of State for filing the articles of incorporation the fee applicable to the amount of authorized stock of the corporation which the Secretary of State is required by law to collect upon the filing of articles of incorporation which authorize the issuance of stock.

3. The Secretary of State shall issue to the corporation over the Great Seal of the State a certificate that a copy of the articles containing the required statements of facts has been filed in the Office of the Secretary of State.

4. Upon the issuance of the certificate by the Secretary of State, the persons signing the articles and their associates and successors are a body politic and corporate. When so filed, the articles of incorporation or certified copies thereof must be received in all the courts of this State, and other places, as prima facie evidence of the facts contained therein.

[Part 3:236:1921; A 1933, 264; 1941, 329; 1949, 635; 1943 NCL § 1577]—(NRS A 1965, 603; 1991, 1246; 1993, 987; 1999, 1600; 2003, 3118; 2007, 2657)

NRS 81.070 Amendment of articles of incorporation. Any such corporation may amend its articles of incorporation in any manner not inconsistent with the provisions of NRS 81.010 to 81.160, inclusive, in the manner provided for by NRS 78.385 and 78.390.

[6:236:1921; A 1939, 23; 1931 NCL § 1580]

NRS 81.080 Bylaws: Adoption; amendment; effectiveness.

1. Each corporation incorporated under NRS 81.010 to 81.160, inclusive, must, within 1 month after filing articles of incorporation, adopt a code of bylaws for its government and management not inconsistent with the provisions of NRS 81.010 to 81.160, inclusive. A majority vote of the members or directors, or the written assent of such members or directors representing a majority of the votes, is necessary to adopt such bylaws.

2. The power to make additional bylaws and to alter the bylaws:

(a) If the bylaws were adopted by the members under the provisions of subsection 1, must remain in the members, but any corporation may, in its articles of incorporation, original or amended, or by resolution adopted by a majority vote, or by written consent of two-thirds of the members, confer that power upon the directors. Bylaws made by the directors under power so conferred may be altered by the directors or by the members.

(b) If the bylaws were adopted by the directors under the provisions of subsection 1, must remain in the directors, but any corporation may, in its articles of incorporation, original or amended, or by resolution adopted by a majority vote of the directors, or by written consent of two-thirds of the directors, confer that power upon the members. Bylaws made by the members under power so conferred may be altered by the directors or by the members.

3. The written consent of the owners of two-thirds of the stock or of two-thirds of the members shall suffice to adopt bylaws in addition to those adopted under the provisions of subsection 1, and to amend or repeal any bylaw.

4. All bylaws in force must be copied legibly in a book called the Book of Bylaws, kept at all times for inspection in the principal office. Until so copied, they shall not be effective or in force.

[Part 4:236:1921; 1933, 264; 1941, 329; 1931 NCL § 1578] + [Part 21:88:1903]—(NRS A 2013, 773)

NRS 81.090 Bylaws: Optional provisions. Each corporation organized under NRS 81.010 to 81.160, inclusive, may also, by its bylaws, provide for the following matters:

1. The number of directors, not less than three, which it may have.

2. The manner of removal of any one or more of its directors.

3. The manner of filling any and all vacancies of the board of directors.

4. The conditions upon which and the time when membership of any member in the corporation shall cease; the mode, manner and effect of expulsion of a member, subject to the right of the corporation through its board of directors to have the full right to purchase the full interest of any member in the property or other rights of the corporation at the book value thereof, as determined by the board of directors, whenever it is to the interests of the corporation to do so. Any member whose rights are so purchased shall cease to be a member. The corporation may, but is not obligated to, retire or purchase any of its obligations before the date of maturity written thereon and held by any retiring member. Any interest which the member may have had in the corporation not represented by certificates of interest, common stock, preferred stock or other obligations duly issued by the corporation or amounts due and unpaid for products delivered shall revert to the corporation as payment for services rendered.

5. The amount of membership fee, if any.

6. The amount which each member shall be required to pay annually, or from time to time, if at all, to carry on the business of the corporation.

7. The compensation, if any, to be paid by each member for any services rendered by the corporation to the member, and the time of payment and the manner of collecting the same, and may provide for forfeiture of the interest of the member in the corporation for nonpayment of the same.

8. The number and qualifications of members of the corporation.

9. The conditions precedent to membership.

10. The method, time and manner of permitting members to withdraw.

11. The assignment and transfer of the interests of members, and the manner of determining the value of such interest by the corporation upon the death, withdrawal or expulsion of a member or upon the forfeiture of a member’s membership, at the option of the corporation.

[Part 4:236:1921; 1933, 264; 1941, 329; 1931 NCL § 1578]

NRS 81.100 Bylaws: Provisions for unequal property rights. If the bylaws shall provide for unequal property rights of the several members, the provisions of NRS 81.010 to 81.160, inclusive, with reference to a majority, a two-thirds, or other vote of the members, shall not apply, and in lieu thereof, there shall be substituted a majority of the votes of the interests represented by the several members or otherwise as the case may be.

[9:236:1921; NCL § 1583]—(NRS A 1971, 146)

NRS 81.110 General powers. A corporation incorporated pursuant to NRS 81.010 to 81.160, inclusive, may:

1. Appoint such agents and officers as its business may require, and the appointed agents may be either persons or corporations.

2. Admit persons and corporations to membership in the corporation.

3. Expel any member pursuant to the provisions of its bylaws.

4. Forfeit the membership of any member for violation of any agreement between the member and the corporation or for the member’s violation of its bylaws.

5. Purchase, lease or otherwise acquire, and hold, own, enjoy, sell, lease, mortgage and otherwise encumber and dispose of, real and personal property.

6. Carry on any operation necessary or convenient in connection with the transactions of any of its business.

[Part 5:236:1921; A 1933, 264; 1941, 329; 1931 NCL § 1579]—(NRS A 1991, 1247)

NRS 81.120 Marketing contracts: Powers of corporation; title to property.

1. Each corporation shall have the power to enter into all contracts deemed advisable with members or others requiring them to market their products or by-products thereof, to or through the association, by which contract it may:

(a) Act as sole agent for the member.

(b) Purchase the products or by-products thereof.

(d) Enjoin a breach or threatened breach of the contract.

2. If members of an association contract to sell to the association, it shall be conclusively held that title to the products or by-products thereof passes absolutely and unreservedly, except for recorded liens, to the association upon delivery or at any time before if specified in the contract.

3. If members of an association in their contracts appoint the association as sole agent to sell or otherwise handle their products or by-products thereof, it shall be conclusively held that only the association has the right to sell or otherwise dispose of the products or by-products mentioned in the contracts of such members.

4. A contract to sell to an association, or an appointment of an association as sole agent by a member of such association, shall constitute full authority without further title to sell or resell the products or by-products thereof mentioned in the contract and to pay over to its members the proceeds of such sale after deducting all necessary selling expense, overhead and other costs and expenses, including interest on preferred stock, deductions for retiring such stock, if any, reserves, if any, and dividends or common stock or certificates of interest, if any, not to exceed 8 percent per annum.

[Part 5:236:1921; A 1933, 264; 1941, 329; 1931 NCL § 1579]

NRS 81.130 Consolidation of cooperative corporations: Procedure; powers.

1. Upon written assent of two-thirds of all the members or by a vote of members representing two-thirds of the total votes of all members of each of two or more such nonprofit cooperative corporations to cooperate with each other for the more economical carrying on of their respective businesses by consolidation, the consolidation may be effected by two or more associations entering into an agreement in writing and adopting a name. The agreement must:

(a) Be signed by two-thirds of the members of each such association.

(b) State all the matters necessary to articles of incorporation.

2. A certified copy of the agreement must be filed in the Office of the Secretary of State and the same fees for filing and recording, as required for filing and recording of original articles of incorporation, must be paid. Upon the filing of the certified copy, the former associations comprising the component parts cease to exist, and the consolidated association:

(a) Succeeds to all the rights, duties and powers of the component associations.

(b) Is possessed of all the rights, duties and powers prescribed in the agreement of consolidated associations not inconsistent with NRS 81.010 to 81.160, inclusive.

(d) Succeeds to all the property and interests thereof.

(e) May make bylaws and do all things permitted by NRS 81.010 to 81.160, inclusive.

3. Any such corporation, upon resolution adopted by its board of directors, may:

(a) Enter into contracts and agreements.

(b) Make stipulations and arrangements with any other corporation or corporations for the cooperative and more economical carrying on of its business, or any part or parts thereof.

4. Any two or more cooperative corporations organized under NRS 81.010 to 81.160, inclusive, upon resolutions adopted by their respective boards of directors, may, for the purpose of more economically carrying out their respective businesses, by agreement, unite in adopting, employing and using, or several such corporations may separately adopt, employ and use, the same methods, policy, means, agents, agencies and terms of marketing for carrying on and conducting their respective businesses.

[Part 5:236:1921; A 1933, 264; 1941, 329; 1931 NCL § 1579]—(NRS A 1991, 1248)

NRS 81.150 Right of corporation to do business: Quo warranto proceedings. The right of a corporation, claiming to be organized and incorporated and carrying on its business under NRS 81.010 to 81.160, inclusive, to do and to continue its business, may be inquired into by quo warranto proceedings at the suit of the Attorney General, but not otherwise.

[7:236:1921; NCL § 1581]

NRS 81.160 Applicability of NRS 81.010 to 81.160, inclusive. The provisions of NRS 81.010 to 81.160, inclusive, are not applicable to railroads, telegraph, telephone, banking, insurance, building and loan, or any other corporation, unless the special provisions of NRS 81.010 to 81.160, inclusive, applicable thereto are complied with.

[8:236:1921; NCL § 1582]

COOPERATIVE ASSOCIATIONS

NRS 81.170 “Lawful business” defined; construction of NRS 81.170 to 81.270, inclusive.

1. NRS 81.170 to 81.270, inclusive, being passed to promote association for mutual welfare, the words “lawful business” extend to every kind of lawful effort for business, education, industrial, benevolent, social or political purposes, whether conducted for profit or not.

2. NRS 81.170 to 81.270, inclusive, must not be strictly construed, but their provisions must at all times be liberally construed with a view to effect their object and to promote their purposes.

[12:60:1901; RL § 1260; NCL § 1595]—(NRS A 1991, 1248; 2005, 2255, 2626)

NRS 81.175 Applicable law.

1. Except as otherwise provided in subsection 2, the provisions of chapter 82 of NRS govern a cooperative association organized pursuant to NRS 81.170 to 81.270, inclusive, except to the extent that the provisions of chapter 82 of NRS are inconsistent with NRS 81.170 to 81.270, inclusive.

2. NRS 82.081 and 82.136 do not apply to a cooperative association organized pursuant to NRS 81.170 to 81.270, inclusive.

(Added to NRS by 1991, 1245)

NRS 81.180 Formation of cooperative association: No capital stock; issuance of membership certificates.

1. It shall be lawful for five or more persons to form a cooperative association for the purpose of transacting any lawful business.

2. Such associations shall not have or issue any capital stock but shall issue membership certificates to each member thereof, and such membership certificates cannot be assigned so that the transferee thereof can by such transfer become a member of the association, except by the resolution of the board of directors of the association; but, by the resolution of consent of the board of directors, such certificates may be transferred so that the transferee may become a member in lieu of the last former holder thereof.

[1:60:1901; RL § 1249; NCL § 1584]

NRS 81.190 Members: Qualifications, rights, interest and duties.

1. All persons above the age of 18 years, regardless of sex, shall be eligible to membership, if otherwise qualified and elected as the bylaws may provide, but minors cannot be empowered to make contracts for the association.

2. The rights and interest of all members in the association shall be equal, and no member can have or acquire a greater interest therein than any other member.

3. At every election held pursuant to the bylaws, each member shall be entitled to cast one vote and no more.

4. No member shall be responsible individually, or personally liable, for any of the debts or liabilities of the association in excess of his or her proportion of the indebtedness authorized to be incurred by the association in the bylaws, but in case of the failure and insolvency of the association the member may be required to pay any unpaid dues or installments which, pursuant to the bylaws, have become due from such member to the association before such insolvency.

[Part 2:60:1901; RL § 1250; NCL § 1585]

NRS 81.200 Articles of association: Filing requirements; required provisions.

1. Each association formed under NRS 81.170 to 81.270, inclusive, shall prepare articles of association in writing, setting forth:

(a) The name of the association.

(b) The purpose for which it is formed.

(d) The term for which it is to exist, which may be perpetual.

(e) The names and addresses, either residence or business, of the directors selected for the first year.

(f) The amount which each member is to pay upon admission as a fee for membership, and that each member signing the articles has actually paid the fee.

(g) That the interest and right of each member therein is to be equal.

(h) The name and address, either residence or business, of each of the persons signing the articles of association.

2. The articles of association must be signed by the original associates or members.

3. The articles so signed must be filed in the Office of the Secretary of State. From the time of the filing in the Office of the Secretary of State, the association may exercise all the powers for which it was formed.

[3:60:1901; A 1941, 326; 1931 NCL § 1586]—(NRS A 1965, 603; 1985, 32; 1991, 1249; 1993, 988; 1995, 2104; 1999, 1600; 2003, 3118; 2003, 20th Special Session, 49; 2005, 2255, 2626; 2007, 2657)

NRS 81.205 Articles of association: Prohibited names and businesses; certification required before filing of certain articles or amendments; defaulting associations.

1. The Secretary of State shall not accept for filing any articles of association or any certificate of amendment of articles of association of any association formed under the provisions of NRS 81.170 to 81.270, inclusive, which provides that the name of the association contains the words “common-interest community,” “community association,” “master association,” “unit-owners’ association” or “homeowners’ association” or if it appears in the articles of association or certificate of amendment of articles of association that the purpose of the association is to operate as a unit-owners’ association pursuant to chapter 116 or 116B of NRS unless the Administrator of the Real Estate Division of the Department of Business and Industry certifies that the association has:

(a) Registered with the Ombudsman for Owners in Common-Interest Communities and Condominium Hotels pursuant to NRS 116.31158 or 116B.625; and

(b) Paid to the Administrator of the Real Estate Division the fees required pursuant to NRS 116.31155 or 116B.620.

2. Upon notification from the Administrator of the Real Estate Division of the Department of Business and Industry that an association which is a unit-owners’ association as defined in NRS 116.011 or 116B.030 has failed to register pursuant to NRS 116.31158 or 116B.625 or failed to pay the fees pursuant to NRS 116.31155 or 116B.620, the Secretary of State shall deem the association to be in default. If, after the association is deemed to be in default, the Administrator notifies the Secretary of State that the association has registered pursuant to NRS 116.31158 or 116B.625 and paid the fees pursuant to NRS 116.31155 or 116B.620, the Secretary of State shall reinstate the association if the association complies with the requirements for reinstatement as provided in this section and NRS 78.180 and 78.185 and pays the fees required pursuant to NRS 82.193.

(Added to NRS by 2005, 2254, 2624; A 2007, 2282)

NRS 81.210 Purpose of business may be changed; amendment of articles.

1. The purpose of the business may be altered, changed, modified, enlarged or diminished, or the articles of association amended, by a vote of two-thirds of all the members at a special election to be called for such purpose. Notice of the special election must be given in the same manner as the bylaws provide for the election of directors.

2. Upon amendment of the articles of association, a copy of the articles as amended must be filed with the Secretary of State.

[7:60:1901; RL § 1255; NCL § 1590]—(NRS A 1965, 604; 1993, 988)

NRS 81.220 General powers. Every association formed under NRS 81.170 to 81.270, inclusive, may:

1. Sue and be sued in any court in its associate name.

2. Make and use a common seal and alter it at pleasure, but the use or nonuse of such a seal does not affect the legality of any record.

3. Receive by gift, devise or purchase, hold and convey, real and personal property as the purposes of the association may require.

4. Appoint such subordinate agents or officers as the business may require.

5. Admit associates or members, and sell or forfeit their interest in the association for default of installments, dues, work or labor required, as provided by the bylaws.

6. Enter into any and all lawful contracts or obligations essential to the transaction of its affairs, for the purpose for which it was formed.

7. Borrow money.

8. Issue all such notes, bills or evidence of indebtedness or mortgage as its bylaws may provide for.

9. Trade, barter, buy, sell and exchange.

10. Do all other things proper to be done for the purpose of carrying into effect the objects for which the association is formed.

[9:60:1901; RL § 1257; NCL § 1592]—(NRS A 1971, 1106; 1991, 1249; 2003, 3119)

NRS 81.230 Bylaws: Adoption; amendment; required and optional provisions.

1. Every association formed under NRS 81.170 to 81.270, inclusive, must, within 40 days after it so becomes an association, adopt a code of bylaws for the government and management of the association, not inconsistent with NRS 81.170 to 81.270, inclusive. A majority of all the associates is necessary to the adoption of bylaws, and the bylaws must be written in a book and signed by the members adopting them.

2. The bylaws cannot be amended or modified except by the vote of a majority of all the members after notice of the proposed amendment is given as the bylaws may provide.

3. The bylaws must provide for the amount of the indebtedness which the association may incur.

4. The association may, by its code of bylaws, provide for:

(a) The time, place and manner of calling and conducting its meetings.

(b) The number of directors, the time of their election, their term of office, the mode and manner of their removal, the mode and manner of filling vacancies in the board caused by death, resignation, removal or otherwise, and the power and authority of directors, and how many thereof are necessary to the exercise of the powers of the directors or of any officer.

(c) The number of the officers, if any, other than the directors, and their term of office, the mode of removal, and the method of filling a vacancy.

(d) The mode and manner of conducting business.

(e) The mode and manner of conducting elections, and may provide for voting by ballots forwarded by mail or otherwise, but the method must secure the secrecy of the ballot.

(f) The mode and manner of succession of membership, and the qualifications of membership, and on what conditions, and when membership ceases, and the mode and manner of expulsion or refusal of a member, but an expelled or refused member is entitled to have a board of arbitration consisting of three persons, one selected by the board of directors, one by the expelled or refused member, and a third by the other two, appraise his or her interest in the association in either money, property or labor, as the directors choose, and to have the money, property or labor so awarded him or her paid or delivered, or performed within 40 days after expulsion or refusal.

(g) The amount of any membership fee, and the dues, installments or labor which each member is required to pay or perform, if any, and the manner of collection or enforcement, and for forfeiture or sale of a member’s interest for nonpayment or nonperformance.

(h) The method, time and manner of permitting the withdrawal of a member, if at all, and how the member’s interest must be ascertained, either in money or property, and within what time it must be paid or delivered to the member.

(i) The mode and manner of ascertaining the interest of a member at his or her death, if his or her legal representatives or none of them desire to succeed to the membership, and whether the value of the deceased member’s interest must be paid to his or her legal representatives in money, property or labor, and within what time it must be paid, delivered or performed, but a withdrawing member or the legal representative of a deceased member has the right to a board of arbitration the same as is provided for expelled or refused members.

(j) Such other things as may be proper to carry out the purpose for which the association was formed.

[Part 2:60:1901; RL § 1250; NCL § 1585] + [4:60:1901; A 1941, 326; 1931 NCL § 1587]—(NRS A 1991, 1250; 2003, 3119)

NRS 81.240 Bylaws: Required and optional provisions concerning profits.

1. The bylaws shall provide for the time and manner in which profits shall be divided between the members, and what proportion of the profits, if any, shall be added to the common property or funds of the association.

2. The bylaws may provide that the directors may suspend or pass the payment of any such profit or installment of earnings at their discretion.

[8:60:1901; RL § 1256; NCL § 1591]

NRS 81.250 Recording and maintaining of bylaws and amendments. The bylaws and all amendments must be recorded in a book and kept in the office of the association.

[5:60:1901; A 1941, 326; 1931 NCL § 1588]—(NRS A 1991, 1251)

NRS 81.260 Association’s property subject to execution; member’s interest sold upon execution; rights of purchaser.

1. The property of the association shall be subject to judgment and execution for the lawful debts of the association.

2. The interest of a member in the association, if sold upon execution, or any judicial or governmental order whatever, cannot authorize the purchaser to have any right, except to succeed, as a member in the association, with the consent of the directors, to the rights of the member whose interest is thus sold. If the directors shall choose to pay or settle the matter, as provided in case of refused members, after such sale, they may either cancel the membership, and add the interest thus sold to the assets or common property of the association, or reissue the share or right to a new member upon proper payment therefor, as the directors may determine.

[6:60:1901; RL § 1254; NCL § 1589]

NRS 81.270 Succession to membership: Nomination and transfer on death.

1. Any member may, upon or after becoming a member, nominate upon his or her application, or otherwise file with the secretary of any association incorporated under NRS 81.170 to 81.270, inclusive, of which he or she is a member, the person whom the member desires to succeed to his or her membership and interests in the association upon his or her death.

2. Upon proof of the member’s death being made, according to the bylaws and to the satisfaction of the association’s board of directors, the secretary shall transfer the deceased member’s membership and interests in the cooperative association to the person or persons so nominated, with the consent of the board of directors, without letters of administration.

3. If the board of directors do not consent to the nominee’s becoming a member, then the association shall, within 90 days after proof, pay the nominee the amount which the deceased member has paid on the membership, together with the amount of his or her other interests in the association.

[11:60:1901; RL § 1259; NCL § 1594]—(NRS A 1991, 1251)

NONPROFIT COOPERATIVE CORPORATIONS WITHOUT STOCK

NRS 81.410 Formation; applicable law.

1. Nonprofit cooperative corporations may be formed by the voluntary association of any three or more persons in the manner prescribed in NRS 81.410 to 81.540, inclusive.

2. Except as otherwise provided in subsection 3, the provisions of chapter 82 of NRS govern a nonprofit cooperative corporation organized pursuant to NRS 81.410 to 81.540, inclusive, except to the extent that the provisions of chapter 82 of NRS are inconsistent with NRS 81.410 to 81.540, inclusive.

3. NRS 82.081 and 82.136 do not apply to a nonprofit cooperative corporation organized pursuant to NRS 81.410 to 81.540, inclusive.

[1:395:1955]—(NRS A 1969, 95; 1991, 1251; 2005, 1024, 2256, 2626)

NRS 81.420 No capital stock; not to be carried on for profit. The corporation shall not have a capital stock, and its business shall not be carried on for profit.

[Part 2:395:1955]

NRS 81.430 Memberships: Certificates; transfer and assignment.

2. Unless the corporation is an association or a unit-owners’ association, each term as defined in NRS 116.011, the corporation shall issue a certificate of membership to each member, but the membership or the certificate thereof shall not, except as provided in NRS 81.410 to 81.540, inclusive, be assigned by any member to any other person, nor shall the assigns thereof be entitled to membership in the corporation, or to any property rights or interest therein.

3. The board of directors may, however, by motion duly adopted by it, consent to such assignment or transfer, and to the acceptance of the assignee or transferee as a member of the corporation.

[Part 2:395:1955]—(NRS A 2021, 1513)

NRS 81.440 Articles of incorporation: Required provisions. Each corporation formed under NRS 81.410 to 81.540, inclusive, shall prepare and file articles of incorporation in writing, setting forth:

1. The name of the corporation.

2. The purpose for which it is formed.

3. The information required pursuant to NRS 77.310.

4. The term for which it is to exist, which may be perpetual.

5. The number of directors thereof, which must be not less than three and which may be any number in excess thereof, and the names and residences of those selected for the first year and until their successors have been elected and have accepted office.

6. Whether the voting power and the property rights and interest of each member are equal or unequal, and if unequal the articles must set forth a general rule applicable to all members by which the voting power and the property rights and interests of each member may be determined, but the corporation may admit new members who may vote and share in the property of the corporation with the old members, in accordance with the general rule.

7. The name and mailing or street address, either residence or business, of each of the incorporators signing the articles of incorporation.

[Part 3:395:1955]—(NRS A 1985, 34; 1991, 1252; 1993, 989; 1995, 2104; 2003, 3120; 2007, 2657)

NRS 81.445 Articles of incorporation: Prohibited names and businesses; certification required before filing of certain articles or amendments; defaulting corporations.

1. The Secretary of State shall not accept for filing any articles of incorporation or any certificate of amendment of articles of incorporation of any corporation formed under the provisions of NRS 81.410 to 81.540, inclusive, which provides that the name of the corporation contains the words “common-interest community,” “community association,” “master association,” “unit-owners’ association” or “homeowners’ association” or if it appears in the articles of incorporation or certificate of amendment of articles of incorporation that the purpose of the corporation is to operate as a unit-owners’ association pursuant to chapter 116 or 116B of NRS unless the Administrator of the Real Estate Division of the Department of Business and Industry certifies that the corporation has:

(a) Registered with the Ombudsman for Owners in Common-Interest Communities and Condominium Hotels pursuant to NRS 116.31158 or 116B.625; and

(b) Paid to the Administrator of the Real Estate Division the fees required pursuant to NRS 116.31155 or 116B.620.

(Added to NRS by 2005, 2254, 2625; A 2007, 2282)

NRS 81.450 Articles of incorporation: Filing requirements; acceptable evidence of incorporation.

1. The articles of incorporation must be:

(a) Signed by three or more of the original members, a majority of whom must be residents of this State.

(b) Filed in the Office of the Secretary of State in all respects in the same manner as other articles of incorporation are filed.

2. The Secretary of State shall issue to the corporation over the Great Seal of the State a certificate that a copy of the articles containing the required statements of facts has been filed in the Office of the Secretary of State.

3. Upon the issuance of the certificate by the Secretary of State the persons signing the articles and their associates and successors are a body politic and corporate. When so filed, the articles of incorporation or certified copies thereof must be received in all the courts of this State, and other places, as prima facie evidence of the facts contained therein.

[Part 3:395:1955]—(NRS A 1965, 604; 1991, 1252; 1993, 989; 1999, 1601; 2003, 3121; 2007, 2658)

NRS 81.470 Bylaws: Adoption; amendment; effectiveness.

1. Each corporation incorporated under NRS 81.410 to 81.540, inclusive, must, within 1 month after filing articles of incorporation, adopt a code of bylaws for its government and management not inconsistent with the provisions of NRS 81.410 to 81.540, inclusive. A majority vote of the members, or the written assent of members representing a majority of the votes, is necessary to adopt such bylaws.

2. The power to make additional bylaws and to alter the bylaws adopted under the provisions of subsection 1 shall be in the members, but any corporation may, in its articles of incorporation, original or amended, or by resolution adopted by a majority vote, or by written consent of a majority of the members, confer that power upon the directors. Bylaws made by the directors under power so conferred, may be altered by the directors or by the members. The written consent of a majority of the members suffices to adopt bylaws in addition to those adopted under the provisions of subsection 1, and to amend or repeal any bylaw.

3. All bylaws in force must be copied legibly in a book called the Book of Bylaws, kept at all times for inspection in the principal office. Until so copied, they shall not be effective or in force.

[Part 4:395:1955]—(NRS A 1977, 656)

NRS 81.480 Bylaws: Optional provisions. Each corporation organized under NRS 81.410 to 81.540, inclusive, may also, by its bylaws, provide for the following matters:

1. The manner of removal of any one or more of its directors.

2. The manner of filling any and all vacancies of the board of directors.

3. The conditions upon which and the time when membership of any member in the corporation shall cease; the mode, manner and effect of expulsion of a member, subject to the right of the expelled member to have the board of directors equitably appraise his or her property interests in the corporation and to fix the amount thereof in money, and to have the money paid to him or her within 60 days after such expulsion.

4. The amount of membership fee, if any.

5. The amount which each member shall be required to pay annually, or from time to time, if at all, to carry on the business of the corporation.

6. The compensation, if any, to be paid by each member for any services rendered by the corporation to the member, and the time of payment and the manner of collecting the same, and may provide for forfeiture of the interest of the member in the corporation for nonpayment of the same.

7. The number and qualifications of members of the corporation.

8. The conditions precedent to membership.

9. The method, time and manner of permitting members to withdraw.

10. The assignment and transfer of the interest of members, and the manner of determining the value of such interest and providing for the purchase of such interest by the corporation upon the death, withdrawal or expulsion of a member or upon the forfeiture of a member’s membership, at the option of the corporation.

[Part 4:395:1955]

NRS 81.490 Bylaws: Provisions for unequal voting power. If the bylaws shall provide for unequal voting power, or unequal property rights of the several members, or both, the provisions of NRS 81.410 to 81.540, inclusive, with reference to a majority, a two-thirds or other vote of the members, shall not apply, and, in lieu thereof, there shall be substituted a majority of the votes of the interests represented by the several members or otherwise as the case may be.

[9:395:1955]

NRS 81.500 General powers.

1. Each corporation incorporated under NRS 81.410 to 81.540, inclusive, has the powers granted by the provisions of other laws of Nevada relating to private corporations which are not inconsistent with those granted by NRS 81.410 to 81.540, inclusive.

2. In addition to the powers granted in subsection 1, each corporation has the following powers:

(a) To appoint such agents and officers as its business may require, and such appointed agents may be either natural persons or corporations.

(b) To admit natural persons and corporations to membership in the corporation.

(d) To forfeit the membership of any member for violation of any agreement between the member and the corporation or for the member’s violation of its bylaws.

(e) To purchase, lease, or otherwise acquire, hold, own and enjoy, sell, lease, mortgage and otherwise encumber and dispose of any and all and every kind of real and personal property, except as otherwise provided in NRS 81.505.

(f) To carry on any and all operations necessary or convenient in connection with the transaction of any of its business.

[Part 5:395:1955]—(NRS A 1987, 770)

NRS 81.505 Restriction on power of rural electric cooperatives to sell, lease or dispose of assets.

1. A rural electric cooperative formed or consolidated pursuant to NRS 81.410 to 81.540, inclusive, may sell, lease or otherwise dispose of all or a substantial portion of its assets only if the sale, lease or disposition is:

(a) Authorized by the affirmative vote of not less than three-fourths of the directors of the cooperative; and

(b) Assented to by two-thirds of the members of the cooperative:

(1) In writing; or

(2) By a vote of the members at a meeting, notice of which has been given in the manner provided in NRS 82.336.

2. As used in this section, “substantial portion of its assets” means any portion of the assets of a cooperative representing 25 percent or more of the total book value of all of its assets.

(Added to NRS by 1987, 770; A 1989, 528; 1991, 1252)

NRS 81.507 Reversion of unclaimed capital credit to electric cooperative under certain circumstances.

1. Any capital credit distributed to a member by an electric cooperative formed under NRS 81.410 to 81.540, inclusive, which remains unclaimed for 1 year after the date authorized for distribution reverts to the cooperative and is not subject to the provisions of chapter 120A of NRS if:

(a) Not more than 6 months after the date the capital credit was authorized for distribution, the cooperative gives notice to the member that the capital credit is available; and

(b) The member fails to respond to such notice within 30 days after receipt of the notification.

2. The notice pursuant to subsection 1 must be sent by mail to the last known address of the member, as it appears in the records of the cooperative.

3. As used in this section, “capital credit” means money which is credited to the capital account of a member of a cooperative after deducting the member’s pro rata share of the operating costs of the cooperative from the amount paid by the member for electric service.

(Added to NRS by 2005, 1023)

NRS 81.510 Agreements for unified action by cooperative corporations. Any two or more cooperative corporations organized under NRS 81.410 to 81.540, inclusive, upon resolutions adopted by their respective boards of directors, may, for the purpose of more economically carrying out their respective businesses, by agreement, unite in adopting, employing and using, or several such corporations may separately adopt, employ and use, the same methods, policy, means, agents, agencies and terms of marketing for carrying on and conducting their respective businesses.

[Part 5:395:1955]—(NRS A 1965, 605; 1989, 528; 1991, 1253)

NRS 81.540 Applicability and effect of NRS 81.410 to 81.540, inclusive.

1. The provisions of NRS 81.410 to 81.540, inclusive, are not applicable to railroads, telegraph, telephone, banking, insurance, building and loan, or any other corporation, unless the special provisions of NRS 81.410 to 81.540, inclusive, applicable thereto are complied with.

2. NRS 81.410 to 81.540, inclusive, do not amend or repeal any of the provisions of NRS 81.010 to 81.160, inclusive, or 81.170 to 81.270, inclusive.

[8:395:1955] + [10:395:1955]—(NRS A 1991, 1254; 2005, 1024)

CHARITABLE ORGANIZATIONS

NRS 81.550 Short title. NRS 81.550 to 81.660, inclusive, may be cited as the Charitable Organization Act.

(Added to NRS by 1971, 631; A 1991, 1254)

NRS 81.560 Declaration of policy. The Legislature hereby declares that the policy of the State is to maximize the funds available for charitable purposes by minimizing, to the greatest extent practicable, the imposition of federal income and excise taxes upon assets otherwise available for charitable purposes.

(Added to NRS by 1971, 631)

NRS 81.570 References to Internal Revenue Code. As used in NRS 81.550 to 81.660, inclusive, unless otherwise indicated, section references are to the Internal Revenue Code of 1954 and include future amendments to those sections and corresponding provisions of future internal revenue laws.

(Added to NRS by 1971, 631; A 1991, 1254)

NRS 81.580 Definitions. As used in NRS 81.550 to 81.660, inclusive, unless the context otherwise requires, the words and terms defined in NRS 81.600, 81.605 and 81.610, have the meanings ascribed to them in those sections.

(Added to NRS by 1971, 631; A 1991, 1254)

NRS 81.600 “Director” defined. “Director” means a director, trustee, person or persons constituting the controlling board of a charitable organization.

(Added to NRS by 1971, 631)

NRS 81.605 “Governing instrument” defined. “Governing instrument” means the articles or certificate of incorporation or association or other written instrument by which a private foundation is created, but does not include its bylaws.

(Added to NRS by 1991, 1246)

NRS 81.610 “Private foundation” defined. “Private foundation” is any nonprofit corporation, association, foundation, or other charitable entity formed pursuant to the laws of the State of Nevada which is a “private foundation” as defined in Section 509(a).

(Added to NRS by 1971, 631; A 1991, 1254)

NRS 81.620 Applicability of NRS 81.550 to 81.660, inclusive. The provisions of NRS 81.550 to 81.660, inclusive, apply to any private foundation whether it was created before or is created on or after October 1, 1991, if it is subject to the sections of the Internal Revenue Code set out in NRS 81.550 to 81.660, inclusive.

(Added to NRS by 1971, 631; A 1991, 1254)

NRS 81.630 Prohibited acts. In the administration of any private foundation that is subject to the provisions of the Internal Revenue Code of 1954, unless otherwise provided in the governing instrument, the following acts are prohibited:

1. Engaging in any act of “self-dealing” (as defined in Section 4941(d)) which would give rise to any liability for the tax imposed by Section 4941(a).

2. Retaining any “excess business holdings” (as defined in Section 4943(c)) which would give rise to any liability for the tax imposed by Section 4943(a).

3. Making any investments which would jeopardize the carrying out of any of the exempt purposes of the organization within the meaning of Section 4944, so as to give rise to any liability for the tax imposed by Section 4944(a).

4. Making any “taxable expenditures” (as defined in Section 4945(d)) which would give rise to any liability for the tax imposed by Section 4945(a).

(Added to NRS by 1971, 631; A 1991, 1254)

NRS 81.640 Minimum distributions required. Unless otherwise provided in the governing instrument, in the administration of any private foundation, there must be distributed for the purposes specified in the governing instrument, for each taxable year, amounts at least sufficient to avoid liability for the tax imposed by Section 4942(a).

(Added to NRS by 1971, 632; A 1991, 1255)

NRS 81.650 Amendment of governing instrument: Procedure.

1. The board of directors or trustees of any private foundation which is a corporation organized under and governed by Nevada law may, by a majority vote of its directors or trustees, amend its governing instrument at any regular or special meeting of the board of directors or trustees, without a vote of the stockholders or members of the private foundation, if any, in order to avoid the penalties and liabilities described in Sections 4941(a), 4942(a), 4943(a), 4944(a) and 4945(a) or to comply with the provisions of Section 508(e).

2. Such an amendment must not be made until the board of directors or trustees has notified the members or stockholders, if any, at least 30 days before the meeting at which the governing instrument is to be amended.

3. If the private foundation is a corporation organized under and governed by Nevada law, after any such amendment has been approved by the directors or trustees, a copy of the amended governing instrument must be filed with the Secretary of State.

(Added to NRS by 1971, 632; A 1983, 696; 1985, 1877; 1991, 1255; 2001, 1382, 3199)

NRS 81.660 Amendment of governing instrument: Provision for termination of status of private foundation. In addition to amending the governing instrument of the private foundation in accordance with NRS 81.650, the amendment may include a provision for the private foundation to conform with the requirements for termination of status as a private foundation as provided in Section 507, in order to avoid the tax provided in Section 507(c).

(Added to NRS by 1971, 632; A 1991, 1255)

UNINCORPORATED NONPROFIT ASSOCIATIONS (UNIFORM ACT)

General Provisions

NRS 81.700 Short title. NRS 81.700 to 81.890, inclusive, may be cited as the Revised Uniform Unincorporated Nonprofit Association Act of 2008.

(Added to NRS by 2009, 692)

NRS 81.705 Definitions. As used in NRS 81.700 to 81.890, inclusive, unless the context otherwise requires, the words and terms defined in NRS 81.710 to 81.740, inclusive, have the meanings ascribed to them in those sections.

(Added to NRS by 2009, 692)

NRS 81.710 “Established practices” defined. “Established practices” means the practices used by an unincorporated nonprofit association without material change during the most recent 5 years of its existence or, if it has existed for less than 5 years, during its entire existence.

(Added to NRS by 2009, 692)

NRS 81.715 “Governing principles” defined. “Governing principles” means the agreements, whether oral, in a record or implied from its established practices, that govern the purpose or operation of an unincorporated nonprofit association and the rights and obligations of its members and managers. The term includes any amendment or restatement of the agreements constituting the governing principles.

(Added to NRS by 2009, 692)

NRS 81.720 “Manager” defined. “Manager” means a person that is responsible, alone or in concert with others, for the management of an unincorporated nonprofit association.

(Added to NRS by 2009, 693)

NRS 81.725 “Member” defined. “Member” means a person that, under the governing principles, may participate in the selection of persons authorized to manage the affairs of the unincorporated nonprofit association or in the development of the policies and activities of the association.

(Added to NRS by 2009, 693)

NRS 81.730 “Person” defined. “Person” means an individual, corporation, business trust, statutory entity trust, estate, trust, partnership, limited-liability company, cooperative, association, joint venture, public corporation, government or governmental subdivision, agency or instrumentality, or any other legal or commercial entity.

(Added to NRS by 2009, 693)

NRS 81.735 “State” defined. “State” means a state of the United States, the District of Columbia, Puerto Rico, the United States Virgin Islands, or any territory or insular possession subject to the jurisdiction of the United States.

(Added to NRS by 2009, 693)

NRS 81.740 “Unincorporated nonprofit association” defined. “Unincorporated nonprofit association” means an unincorporated organization consisting of two or more members joined under an agreement that is oral, in a record or implied from conduct, for one or more common nonprofit purposes. The term does not include:

1. A trust;

2. A marriage, domestic partnership, common law domestic relationship, civil union or other domestic living arrangement;

3. An organization formed under any other statute that governs the organization and operation of unincorporated associations;

4. A joint tenancy, tenancy in common or tenancy by the entireties, even if the co-owners share use of the property for a nonprofit purpose; or

5. A relationship under an agreement in a record which expressly provides that the relationship between the parties does not create an unincorporated nonprofit association.

(Added to NRS by 2009, 693)

NRS 81.745 Relation to other law.

1. Unless displaced by particular provisions of NRS 81.700 to 81.890, inclusive, the principles of law and equity supplement the provisions of NRS 81.700 to 81.890, inclusive.

2. A statute governing a specific type of unincorporated nonprofit association prevails over an inconsistent provision in NRS 81.700 to 81.890, inclusive, to the extent of the inconsistency.

3. The provisions of NRS 81.700 to 81.890, inclusive, supplement the laws of this State that apply to nonprofit associations operating in this State. If a conflict exists, such law applies.

(Added to NRS by 2009, 693)

NRS 81.750 Governing law.

1. Except as otherwise provided in subsection 2, the law of this State governs the operation in this State of all unincorporated nonprofit associations formed or operating in this State.

2. Unless the governing principles specify a different jurisdiction, the law of the jurisdiction in which an unincorporated nonprofit association has its main place of activities governs the internal affairs of the association.

(Added to NRS by 2009, 693)

Nature and Powers

NRS 81.755 Legal entity; perpetual existence; powers.

1. An unincorporated nonprofit association is a legal entity distinct from its members and managers.

2. An unincorporated nonprofit association has perpetual duration unless the governing principles specify otherwise.

3. An unincorporated nonprofit association has the same powers as an individual to do all things necessary or convenient to carry on its purposes.

4. An unincorporated nonprofit association may engage in profit-making activities but profits from any activities must be used or set aside for the association’s nonprofit purposes.

(Added to NRS by 2009, 693)

NRS 81.760 Ownership and transfer of property.

1. An unincorporated nonprofit association may acquire, hold, encumber or transfer in its name an interest in real or personal property.

2. An unincorporated nonprofit association may be a beneficiary of a trust or contract, a legatee or a devisee.

(Added to NRS by 2009, 694)

NRS 81.765 Statement of authority as to real property.

1. An interest in real property held in the name of an unincorporated nonprofit association may be transferred by a person authorized to do so in a statement of authority recorded by the association in the office of the county recorder in which a transfer of the property would be recorded.

2. A statement of authority must set forth:

(a) The name of the unincorporated nonprofit association;

(b) The address in this State, including the street address, if any, of the association or, if the association does not have an address in this State, its out-of-state address;

(d) The name, title or position of a person authorized to transfer an estate or interest in real property held in the name of the association.

3. A statement of authority must be executed in the same manner as a deed by a person other than the person authorized in the statement to transfer the interest.

4. A county recorder may collect a fee for recording a statement of authority in the amount authorized for recording a transfer of real property.

5. A document amending, revoking or cancelling a statement of authority or stating that the statement is unauthorized or erroneous must meet the requirements for executing and recording an original statement.

6. Unless cancelled earlier, a recorded statement of authority and its most recent amendment expire 5 years after the date of the most recent recording.

7. If the record title to real property is in the name of an unincorporated nonprofit association and the statement of authority is recorded in the office of the county recorder in which a transfer of the property would be recorded, the authority of the person named in the statement to transfer is conclusive in favor of a person that gives value without notice that the person lacks authority.

8. As used in this section, “statement of authority” means a statement authorizing a person to transfer an interest in real property held in the name of an unincorporated nonprofit association.

(Added to NRS by 2009, 694)

NRS 81.770 Liability.

1. A debt, obligation or other liability of an unincorporated nonprofit association, whether arising in contract, tort or otherwise:

(a) Is solely the debt, obligation or other liability of the association; and

(b) Does not become a debt, obligation or other liability of a member or manager solely because the member acts as a member or the manager acts as a manager.

2. A person’s status as a member or manager does not prevent or restrict law other than the provisions of NRS 81.700 to 81.890, inclusive, from imposing liability on the person or the association because of the person’s conduct.

(Added to NRS by 2009, 694)

NRS 81.775 Assertion and defense of claims.

1. An unincorporated nonprofit association may sue or be sued in its own name.

2. A member or manager may assert a claim the member or manager has against the unincorporated nonprofit association. An association may assert a claim it has against a member or manager.

(Added to NRS by 2009, 695)

NRS 81.780 Effect of judgment or order. A judgment or order against an unincorporated nonprofit association is not by itself a judgment or order against a member or manager.

(Added to NRS by 2009, 695)

NRS 81.785 Appointment of agent to receive service of process; service of process.

1. An unincorporated nonprofit association may, in the manner provided pursuant to chapter 77 of NRS, appoint a registered agent who is authorized to receive any process, notice or demand required or permitted by law to be served upon the association.

2. In an action or proceeding against an unincorporated nonprofit association, any process, notice or demand may be served:

(a) On a registered agent appointed pursuant to subsection 1;

(b) On a manager of the association; or

3. This section does not limit or affect the right to serve any process, notice or demand required or permitted by law to be served upon an unincorporated nonprofit association in any other manner permitted by law.

4. As used in this section, “registered agent” has the meaning ascribed to it in NRS 77.230.

(Added to NRS by 2009, 695)

NRS 81.790 Action or proceeding not abated by change in members or managers. An action or proceeding against an unincorporated nonprofit association does not abate merely because of a change in its members or managers.

(Added to NRS by 2009, 695)

NRS 81.795 Venue. Unless otherwise provided by law other than the provisions of NRS 81.700 to 81.890, inclusive, venue of an action against an unincorporated nonprofit association brought in this State is determined under the statutes applicable to an action brought in this State against a corporation.

(Added to NRS by 2009, 695)

Members and Managers

NRS 81.800 Member not agent. A member is not an agent of the association solely by reason of being a member.

(Added to NRS by 2009, 695)

NRS 81.805 Certain actions require approval by members.

1. Except as otherwise provided in the governing principles, an unincorporated nonprofit association must have the approval of its members to:

(a) Admit, suspend, dismiss or expel a member;

(b) Select or dismiss a manager;

(d) Sell, lease, exchange or otherwise dispose of all or substantially all of the association’s property, with or without the association’s goodwill, outside the ordinary course of its activities;

(e) Dissolve under paragraph (b) of subsection 1 of NRS 81.865 or merge under NRS 81.875;

(f) Undertake any other act outside the ordinary course of the association’s activities; or

(g) Determine the policy and purposes of the association.

2. An unincorporated nonprofit association must have the approval of the members to do any other act or exercise a right that the governing principles require to be approved by members.

(Added to NRS by 2009, 695)

NRS 81.810 Meetings of members: Voting, notice and quorum requirements.

1. Unless the governing principles provide otherwise:

(a) Approval of a matter by members requires an affirmative majority of the votes cast at a meeting of members; and

(b) Each member is entitled to one vote on each matter that is submitted for approval by members.

2. Notice and quorum requirements for member meetings and the conduct of meetings of members are determined by the governing principles.

(Added to NRS by 2009, 696)

NRS 81.815 Duties of member.

1. A member does not have a fiduciary duty to an unincorporated nonprofit association or to another member solely by being a member.

2. A member shall discharge the duties to the unincorporated nonprofit association and the other members and exercise any rights under the provisions of NRS 81.700 to 81.890, inclusive, consistent with the governing principles and the obligation of good faith and fair dealing.

(Added to NRS by 2009, 696)

NRS 81.820 Admission, suspension, dismissal or expulsion of members.

1. A person becomes a member and may be suspended, dismissed or expelled in accordance with the association’s governing principles. If there are no applicable governing principles, a person may become a member or be suspended, dismissed or expelled from an association only by a vote of its members. A person may not be admitted as a member without the person’s consent.

2. Unless the governing principles provide otherwise, the suspension, dismissal or expulsion of a member does not relieve the member from any unpaid capital contribution, dues, assessments, fees or other obligation incurred or commitment made by the member before the suspension, dismissal or expulsion.

(Added to NRS by 2009, 696)

NRS 81.825 Resignation of member.

1. A member may resign as a member in accordance with the governing principles. In the absence of applicable governing principles, a member may resign at any time.

2. Unless the governing principles provide otherwise, resignation of a member does not relieve the member from any unpaid capital contribution, dues, assessments, fees or other obligation incurred or commitment made by the member before resignation.

(Added to NRS by 2009, 696)

NRS 81.830 Membership interest not transferable. Except as otherwise provided in the governing principles, a member’s interest or any right under the governing principles is not transferable.

(Added to NRS by 2009, 696)

NRS 81.835 Selection of managers; management rights of managers. Except as otherwise provided in NRS 81.700 to 81.890, inclusive, or the governing principles:

1. Only the members may select a manager or managers;

2. A manager may be a member or a nonmember;

3. If a manager is not selected, all members are managers;

4. Each manager has equal rights in the management and conduct of the association’s activities;

5. All matters relating to the association’s activities are decided by its managers except for matters reserved for approval by members in NRS 81.805; and

6. A difference among managers is decided by a majority of the managers.

(Added to NRS by 2009, 696)

NRS 81.840 Duties of managers.

1. A manager owes to the unincorporated nonprofit association and to its members the fiduciary duties of loyalty and care.

2. A manager shall manage the unincorporated nonprofit association in good faith, in a manner the manager reasonably believes to be in the best interests of the association, and with such care, including reasonable inquiry, as a prudent person would reasonably exercise in a similar position and under similar circumstances. A manager may rely in good faith upon any opinion, report, statement or other information provided by another person that the manager reasonably believes is a competent and reliable source for the information.

3. After full disclosure of all material facts, a specific act or transaction that would otherwise violate the duty of loyalty by a manager may be authorized or ratified by a majority of the members that are not interested directly or indirectly in the act or transaction.

4. A manager that makes a business judgment in good faith satisfies the duties specified in subsection 1 if the manager:

(a) Is not interested, directly or indirectly, in the subject of the business judgment and is otherwise able to exercise independent judgment;

(b) Is informed with respect to the subject of the business judgment to the extent the manager reasonably believes to be appropriate under the circumstances; and

(c) Believes that the business judgment is in the best interests of the unincorporated nonprofit association and in accordance with its purposes.

5. The governing principles in a record may limit or eliminate the liability of a manager to the unincorporated nonprofit association or its members for damages for any action taken, or for failure to take any action, as a manager, except liability for:

(a) The amount of financial benefit improperly received by a manager;

(b) An intentional infliction of harm on the association or one or more of its members;

(d) Breach of the duty of loyalty; or

(e) Improper distributions.

(Added to NRS by 2009, 697)

NRS 81.845 Meetings of managers: Notice and quorum requirements. Notice and quorum requirements for meetings of managers and the conduct of meetings of managers are determined by the governing principles.

(Added to NRS by 2009, 697)

NRS 81.850 Right of member or manager to information.

1. On reasonable notice, a member or manager of an unincorporated nonprofit association may inspect and copy during the regular operating hours of the unincorporated nonprofit association, at a reasonable location specified by the association, any record maintained by the association regarding its activities, financial condition and other circumstances, to the extent the information is material to the member’s or manager’s rights and duties under the governing principles.

2. An unincorporated nonprofit association may impose reasonable restrictions on access to and use of information to be furnished under this section, including designating the information confidential and imposing obligations of nondisclosure and safeguarding on the recipient.

3. An unincorporated nonprofit association may charge a person that makes a demand under this section reasonable copying costs, limited to the costs of labor and materials.

4. A former member or manager is entitled to information to which the member or manager was entitled while a member or manager if the information pertains to the period during which the person was a member or manager, the former member or manager seeks the information in good faith and the former member or manager satisfies subsections 1, 2 and 3.

(Added to NRS by 2009, 697)

NRS 81.855 Distributions prohibited; compensation and other permitted payments.

1. Except as otherwise provided in subsection 2, an unincorporated nonprofit association may not pay dividends or make distributions to a member or manager.

2. An unincorporated nonprofit association may:

(a) Pay reasonable compensation or reimburse reasonable expenses to a member or manager for services rendered;

(b) Confer benefits on a member or manager in conformity with its nonprofit purposes;

(c) Repurchase a membership and repay a capital contribution made by a member to the extent authorized by its governing principles; or

(d) Make distributions of property to members upon winding up and termination to the extent permitted by NRS 81.870.

(Added to NRS by 2009, 698)

NRS 81.860 Reimbursement; indemnification; advancement of expenses.

1. Except as otherwise provided in the governing principles, an unincorporated nonprofit association shall reimburse a member or manager for authorized expenses reasonably incurred in the course of the member’s or manager’s activities on behalf of the association.

2. An unincorporated nonprofit association may indemnify a member or manager for any debt, obligation or other liability incurred in the course of the member’s or manager’s activities on behalf of the association if the member or manager seeking indemnification has complied with NRS 81.815 and 81.840. Governing principles in a record may broaden or limit indemnification.

3. If a person is made or threatened to be made a party in an action based on that person’s activities on behalf of an unincorporated nonprofit association and the person makes a request in a record to the association, a majority of the disinterested managers may approve in a record advance payment or reimbursement by the association of all or a part of the reasonable expenses, including attorney’s fees and costs, incurred by the person before the final disposition of the proceeding. To be entitled to an advance payment or reimbursement, the person must state in a record that the person has a good faith belief that the criteria for indemnification in subsection 2 have been satisfied and that the person will repay the amounts advanced or reimbursed if the criteria for payment have not been satisfied. The governing principles in a record may broaden or limit the advance payments or reimbursements.

4. An unincorporated nonprofit association may purchase insurance on behalf of a member or manager for liability asserted against or incurred by the member or manager in the capacity of a member or manager, whether or not the association has authority under the provisions of NRS 81.700 to 81.890, inclusive, to reimburse, indemnify or advance expenses to the member or manager against the liability.

5. The rights of reimbursement, indemnification and advancement of expenses under this section apply to a former member or manager for an activity undertaken on behalf of the unincorporated nonprofit association while a member or manager.

(Added to NRS by 2009, 698)

Termination and Mergers

NRS 81.865 Dissolution.

1. An unincorporated nonprofit association may be dissolved as follows:

(a) If the governing principles provide a time or method for dissolution, at that time or by that method ;

(b) If the governing principles do not provide a time or method for dissolution, upon approval by the members ;

(c) If no member can be located and the association’s operations have been discontinued for at least 3 years, by the managers or, if the association has no current manager, by its last manager;

(d) By court order; or

(e) Under law other than NRS 81.700 to 81.890, inclusive.

2. After dissolution, an unincorporated nonprofit association continues in existence until its activities have been wound up and it is terminated pursuant to NRS 81.870.

(Added to NRS by 2009, 699)

NRS 81.870 Winding up and termination. Winding up and termination of an unincorporated nonprofit association must proceed in accordance with the following rules:

1. All known debts and liabilities must be paid or adequately provided for.

2. Any property subject to a condition requiring return to the person designated by the donor must be transferred to that person.

3. Any property subject to a trust must be distributed in accordance with the trust agreement.

4. Any remaining property must be distributed as follows:

(a) As required by law other than NRS 81.700 to 81.890, inclusive, that requires assets of an association to be distributed to another person with similar nonprofit purposes;

(b) In accordance with the association’s governing principles or, in the absence of applicable governing principles, to the members of the association per capita or as the members direct; or

(Added to NRS by 2009, 699)

NRS 81.875 Mergers.

1. An unincorporated nonprofit association may merge with any organization that is authorized by law to merge with an unincorporated nonprofit association.

2. A merger involving an unincorporated nonprofit association is subject to the following rules:

(a) Each constituent organization shall comply with its governing law.

(b) Each party to the merger shall approve a plan of merger. The plan, which must be in a record, must include the following provisions:

(1) The name and form of each organization that is a party to the merger;

(2) The name and form of the surviving organization and, if the surviving organization is to be created by the merger, a statement to that effect;

(3) If the surviving organization is to be created by the merger, the surviving organization’s organizational documents that are proposed to be in a record;

(4) If the surviving organization is not to be created by the merger, any amendments to be made by the merger to the surviving organization’s organizational documents that are, or are proposed to be, in a record; and

(5) The terms and conditions of the merger, including the manner and basis for converting the interests in each constituent organization into any combination of money, interests in the surviving organization, and other consideration except that the plan of merger may not permit members of an unincorporated nonprofit association to receive merger consideration if a distribution of such consideration would not be permitted in the absence of a merger under NRS 81.855 and 81.870.

(c) The plan of merger must be approved by the members of each unincorporated nonprofit association that is a constituent organization in the merger. If a plan of merger would impose personal liability for an obligation of a constituent or surviving organization on a member of an association that is a party to the merger, the plan may not take effect unless it is approved in a record by the member.

(d) Subject to the contractual rights of third parties, after a plan of merger is approved and at any time before the merger is effective, a constituent organization may amend the plan or abandon the merger as provided in the plan, or except as otherwise prohibited in the plan, with the same consent as was required to approve the plan.

(e) Following approval of the plan, a merger under this section is effective:

(1) If a constituent organization is required to give notice to or obtain the approval of a governmental agency or officer in order to be a party to a merger, when the notice has been given and the approval has been obtained; and

(2) If the surviving organization:

(I) Is an unincorporated nonprofit association, as specified in the plan of merger and upon compliance by any constituent organization that is not an association with any requirements, including any required filings in the Office of the Secretary of State, of the organization’s governing statute; or

(II) Is not an unincorporated nonprofit association, as provided by the statutes governing the surviving organization.

3. When a merger becomes effective:

(a) The surviving organization continues or comes into existence;

(b) Each constituent organization that merges into the surviving organization ceases to exist as a separate entity;

(d) All debts, obligations or other liabilities of each nonsurviving organization continue as debts, obligations or other liabilities of the surviving organization;

(e) An action or proceeding pending by or against any nonsurviving organization may be continued as if the merger had not occurred;

(f) Except as prohibited by law other than NRS 81.700 to 81.890, inclusive, all of the rights, privileges, immunities, powers and purposes of each constituent organization that ceases to exist vest in the surviving organization;

(g) Except as otherwise provided in the plan of merger, the terms and conditions of the plan of merger take effect;

(h) The merger does not affect the personal liability, if any, of a member or manager of a constituent organization for a debt, obligation or other liability incurred before the merger is effective; and

(i) A surviving organization that is not organized in this State is subject to the jurisdiction of the courts of this State to enforce any debt, obligation or other liability owed by a constituent organization if, before the merger, the constituent organization was subject to suit in this State for the debt, obligation or other liability.

4. Property held for a charitable purpose under the laws of this State by a constituent organization immediately before a merger under this section becomes effective may not, as a result of the merger, be diverted from the objects for which it was given, unless, to the extent required by or pursuant to the laws of this State concerning cy-pres or other law dealing with nondiversion of charitable assets, the organization obtains an appropriate order of the court specifying the disposition of the property.

5. A bequest, devise, gift, grant or promise contained in a will or other instrument of donation, subscription or conveyance that is made to a nonsurviving organization and that takes effect or remains payable after the merger inures to the surviving organization. A trust obligation that would govern property if transferred to the nonsurviving organization applies to property that is transferred to the surviving organization under this section.

6. As used in this section:

(a) “Constituent organization” means an organization that is merged with one or more other organizations, including the surviving organization.

(b) “Nonsurviving organization” means a constituent organization that is not the surviving organization.

(c) “Organization” means an unincorporated nonprofit association, a general partnership, including a limited-liability partnership, limited partnership, including a limited-liability limited partnership, limited-liability company, business or statutory trust, corporation, or any other legal or commercial entity having a statute governing its formation and operation. The term includes a for-profit or nonprofit organization.

(d) “Surviving organization” means an organization into which one or more other organizations are merged.

(Added to NRS by 2009, 699)

Miscellaneous Provisions

NRS 81.880 Transition concerning real and personal property.

1. If, before October 1, 2009, an interest in property was, by terms of a transfer, purportedly transferred to an unincorporated nonprofit association, but under the laws of this State, the interest did not vest in the association, or in one or more persons on behalf of the association under subsection 2, on October 1, 2009, the interest vests in the association, unless the parties to the transfer have treated the transfer as ineffective.

2. If, before October 1, 2009, an interest in property was, by terms of a transfer, purportedly transferred to an unincorporated nonprofit association, but the interest was vested in one or more persons to hold the interest for members of the association, on or after October 1, 2009, the persons, or their successors in interest, may transfer the interest to the association in its name, or the association may require that the interest be transferred to it in its name.

(Added to NRS by 2009, 701)

NRS 81.885 Uniformity of application and construction. In applying and construing the provisions of NRS 81.700 to 81.890, inclusive, consideration must be given to the need to promote uniformity of the law with respect to its subject matter among states that enact it.

(Added to NRS by 2009, 701)

NRS 81.890 Relations to Electronic Signatures in Global and National Commerce Act. The provisions of NRS 81.700 to 81.890, inclusive, modify, limit and supersede the federal Electronic Signatures in Global and National Commerce Act, 15 U.S.C. §§ 7001 et seq., but do not modify, limit or supersede Section 101(c) of that Act, 15 U.S.C. § 7001(c), or authorize electronic delivery of any of the notices described in Section 103(b) of that Act, 15 U.S.C. § 7003(b).

(Added to NRS by 2009, 701)

WORKER COOPERATIVE CORPORATIONS

General Provisions

NRS 81.901 Definitions. As used in NRS 81.901 to 81.959, inclusive, unless the context otherwise requires, the words and terms defined in NRS 81.903 to 81.915, inclusive, have the meanings ascribed to them in those sections.

(Added to NRS by 2019, 907)

NRS 81.903 “Member” defined. “Member” means a natural person who:

1. Has been accepted for membership in a worker cooperative; and

2. Owns a membership share issued by a worker cooperative.

(Added to NRS by 2019, 907)

NRS 81.905 “Membership share” defined. “Membership share” means a single class of stock that has unlimited voting rights issued by a worker cooperative to a member.

(Added to NRS by 2019, 907)

NRS 81.907 “Patronage” defined. “Patronage” means the amount of work performed by a member measured in accordance with the articles of incorporation and bylaws of a worker cooperative.

(Added to NRS by 2019, 907)

NRS 81.909 “Patronage dividend” defined. “Patronage dividend” means a dividend or distribution of net income made on the basis of patronage.

(Added to NRS by 2019, 907)

NRS 81.911 “Quorum” defined. “Quorum” means a simple majority of the members.

(Added to NRS by 2019, 907)

NRS 81.913 “Worker cooperative” defined. “Worker cooperative” means a corporation which has elected to be governed by the provisions of NRS 81.901 to 81.959, inclusive.

(Added to NRS by 2019, 907)

NRS 81.915 “Written notice of allocation” defined. “Written notice of allocation” means a written instrument which discloses to a member the stated dollar amount of his or her patronage dividend and the terms for payment of that amount by a worker cooperative to the member.

(Added to NRS by 2019, 907)

NRS 81.917 Legislative findings and declarations. The Legislature hereby finds and declares that a worker cooperative:

1. Has the purpose of creating and maintaining sustainable jobs and generating wealth.

2. Is essential to:

(a) Improving the quality of life of the members of the worker cooperative;

(b) Dignifying human work;

(d) Promoting community and local development in this State.

(Added to NRS by 2019, 907)

Formation and Operation

NRS 81.919 Election of corporation to be governed as worker cooperative; applicable law.

1. A corporation formed pursuant to chapter 78 of NRS may elect to be governed as a worker cooperative under the provisions of NRS 81.901 to 81.959, inclusive, and such an election must be stated in the articles of incorporation of the corporation or in an amendment to the articles of incorporation of the corporation filed pursuant to chapter 78 of NRS.

2. The provisions of chapter 78 of NRS govern a worker cooperative established pursuant to NRS 81.901 to 81.959, inclusive, except to the extent that the provisions of chapter 78 of NRS are inconsistent with NRS 81.901 to 81.959, inclusive.

(Added to NRS by 2019, 907)

NRS 81.921 Apportionment and distribution of net earnings and losses.

1. The net earnings and losses of a worker cooperative must be apportioned and distributed at the time and in the manner specified by the articles of incorporation or bylaws of the worker cooperative.

2. Any net earnings declared as patronage dividends and paid to members must be apportioned among the members in the proportion of the patronage of each member during a given period of time to the total patronage by all members during that period of time.

3. The apportionment, distribution and payment of net earnings pursuant to this section may be in cash, credits, written notices of allocation or corporate shares issued by the worker cooperative.

(Added to NRS by 2019, 912)

NRS 81.923 Use of internal capital and collective reserve accounts; redemption of corporate shares and written notices of allocation; recall and redemption of membership shares. The articles of incorporation or bylaws of a worker cooperative may:

1. Establish a system of internal capital accounts to reflect the book value of the worker cooperative and to determine the redemption price of membership shares, corporate shares and written notices of allocation.

2. Permit the periodic redemption of written notices of allocation and corporate shares and may provide for recall and redemption of membership shares upon termination of membership in the worker cooperative unless the redemption would result in the liability of a director of the worker cooperative.

3. Authorize the worker cooperative to pay or credit interest on the balance of the internal capital account of each member.

4. Authorize the assignment of a portion of retained net earnings and net losses to a collective reserve account. Such assigned earnings may be used for any corporate purpose determined by the board of directors of the worker cooperative.

(Added to NRS by 2019, 912)

NRS 81.925 Reserve accounts; allocation of indivisible reserve account upon dissolution or sale.

1. A worker cooperative may use:

(a) A divisible reserve account; or

(b) An indivisible reserve account.

2. An account used pursuant to subsection 1 may be used to pay the expenses of a worker cooperative, including, without limitation, wages.

3. Upon the dissolution or sale of a worker cooperative, an indivisible reserve account of the worker cooperative must be allocated to an indivisible reserve account of another worker cooperative or nonprofit corporation.

(Added to NRS by 2019, 912)

NRS 81.927 Authority to operate as internal capital account cooperative; accounts.

1. The articles of incorporation or bylaws of a worker cooperative may establish the worker cooperative as an internal capital account cooperative.

2. Each member of an internal capital account cooperative shall have one vote.

3. An internal capital account cooperative shall:

(a) Credit the membership fee and additional capital paid by a member to the internal capital account of that member; and

(b) Record the apportionment of retained net earnings or losses to the members in accordance with patronage by appropriately crediting or debiting the internal capital account of each member.

4. The capital reserve account in an internal capital account cooperative must reflect any capital, net losses and retained net earning not allocated to individual members.

5. The balances in every internal capital account and collective reserve account, if applicable, must be adjusted at the end of each accounting period so that the sum of the balances is equal to the net book value of the worker cooperative.

6. As used in this section, “internal capital account cooperative” means a worker cooperative whose entire net book value is reflected in internal capital accounts, one for each member, and a collective reserve account.

(Added to NRS by 2019, 913)

Members and Directors

1. The articles of incorporation or bylaws of a worker cooperative must establish:

(a) The qualifications for membership, including, without limitation, that a member must be employed by the worker cooperative on a full- or part-time basis; and

(b) The method of acceptance, expulsion, termination and suspension of members.

2. At least 51 percent of the members of a worker cooperative must be employees of the worker cooperative.

3. An authorized and voluntary leave of absence from a worker cooperative by a member of the worker cooperative must not revoke the membership status of the member.

4. Members shall have all the rights and responsibilities of a stockholder of a corporation pursuant to chapter 78 of NRS.

(Added to NRS by 2019, 907)

NRS 81.931 Board of directors: Composition; annual meeting with members; authority of members to override decisions; considerations when exercising powers.

1. A majority of the directors on the board of directors of a worker cooperative must be members.

2. The board of directors shall meet with the members not less than annually.

3. A majority vote of the members shall override any decision by the board of directors, unless the articles of incorporation or bylaws of the worker cooperative require a larger percentage of the vote to override such a decision.

4. A meeting in which the members will vote whether to override a decision of the board of directors must be called by at least 5 percent of the members.

5. The board of directors of a worker cooperative, in exercising their respective powers with a view of the interests of the worker cooperative, may:

(a) Consider all relevant facts, circumstances, contingencies or constituencies, including, without limitation:

(1) The interests of the members, employees, suppliers, creditors and customers of the worker cooperative;

(2) The economy of this State or the nation;

(3) The interests of the community or society;

(4) The local and global environment;

(5) The long-term and short-term interests of the worker cooperative, including, without limitation, the possibility that such interests may be best served by control of the worker cooperative remaining unchanged; and

(6) The long-term and short-term interests of the members and shareholders, as applicable, of the worker cooperative.

(b) Consider or assign weight to the interests of any particular person or group, or to any other relevant facts, circumstances, contingencies or constituencies.

(Added to NRS by 2019, 908)

NRS 81.933 Membership shares; voting power of shares other than membership shares.

1. Each member shall own one membership share, and only members may own such shares.

2. Membership shares:

(a) Must be issued for a fee determined by the board of directors of the worker cooperative.

(b) Must not be considered a security.

3. Except as otherwise provided in subsection 4:

(a) No shares of the corporation other than membership shares may be given voting power in a worker cooperative.

(b) The power to amend or repeal the bylaws of a worker cooperative may only be given to the members.

4. An amendment that adversely affects the rights of the holders of corporate shares other than membership shares may not be adopted without the vote of such shareholders pursuant to chapter 78 of NRS.

(Added to NRS by 2019, 908)

NRS 81.935 Procedure for expulsion, termination or suspension of member.

1. An expulsion, termination or suspension of a member which deviates from the procedural requirements of this section is void and without effect.

2. An expulsion, termination or suspension of a member must be performed in good faith and in a fair and reasonable manner.

3. A procedure for the expulsion, termination or suspension of a member is fair and reasonable if such a procedure is set forth in the articles of incorporation or bylaws of a worker cooperative and the procedure:

(a) Provides 15 days’ notice of the expulsion, termination or suspension and such notice includes, without limitation, a reason for the expulsion, termination or suspension; and

(b) Gives the member an opportunity to be heard, orally or in writing, before a person or body authorized to make such a decision regarding the expulsion, termination or suspension not less than 5 days before the effective date of the expulsion, termination or suspension.

4. A court may determine that a procedure for the expulsion, termination or suspension of a member was fair and reasonable pursuant to subsection 2.

5. The notice pursuant to subsection 3 must be reasonably calculated to provide actual notice to a member. The notice may be served by first-class or registered mail sent to the last known address of the member as shown in the records of the worker cooperative.

6. A member who is expelled, terminated or suspended is liable for any services or benefits actually rendered, dues, assessments, fees or charges incurred before his or her expulsion, termination or suspension.

(Added to NRS by 2019, 909)

NRS 81.937 Action challenging expulsion, termination or suspension of member.

1. An action challenging an expulsion, termination or suspension of a member, including, without limitation, a claim alleging defective notice, pursuant to NRS 81.935 must be commenced within 1 year after the date of the expulsion, termination or suspension.

2. If a member is successful in his or her claim pursuant to subsection 1, a court may order any relief, including, without limitation, the reinstatement of a membership.

3. Unless a court finds that the member was expelled, terminated or suspended in bad faith in order to affect the outcome of a vote, a decision made by a vote of the members or the board of directors of a workers cooperative must not be set aside because a member was successful in his or her claim pursuant to subsection 1.

(Added to NRS by 2019, 909)

Meetings

NRS 81.939 Notice of meeting at which members are required or permitted to vote; notice of special meeting.

1. For a meeting during which members are required or permitted to vote, notice must be given, in writing, not less than 10 days or more than 90 days before the date of the meeting. Such notice must be provided to each member who, on the record date, is entitled to vote.

2. Except as otherwise provided in this subsection, if the notice pursuant to subsection 1 is provided by mail, such notice must be given not less than 20 days before the meeting. If the notice is mailed by first-class, registered or certified mail, such notice must be given not less than 10 days before the meeting.

3. If a member submits a written request to hold a special meeting to the chair of the board of directors, president, vice president or secretary of a worker cooperative, the special meeting must be held not less than 35 days and not more than 90 days after the receipt of such a request. The requesting member must not be a director of the board of directors.

4. If notice of a special meeting is not given within 20 days after a request is submitted pursuant to subsection 3:

(a) The member requesting the special meeting pursuant to subsection 3 may provide notice to the members in accordance with the requirements of subsection 3; or

(b) The member may request that a district court order service of the notice pursuant to subsection 3.

5. A district court shall provide a worker cooperative with an opportunity to be heard before the court makes an order pursuant to paragraph (b) of subsection 4.

(Added to NRS by 2019, 909)

NRS 81.941 Personal notice of meeting consisting only of members; authority to veto decision made at meeting for which notice was not received.

1. Before a meeting consisting of only members, personal notice must be given to each member not less than 48 hours before the meeting. Such notice must be provided to each member who, on the record date, is entitled to vote.

2. Any decision made at a meeting held pursuant to subsection 1 may be vetoed by a member who:

(a) Was not present at the meeting; and

(b) Did not receive 48 hours’ notice,

Ê unless a majority of the members or another percentage of the members as specified in the articles of incorporation or the bylaws of the worker cooperative were present at the meeting.

(Added to NRS by 2019, 910)

NRS 81.943 Contents of notice. Notice of a meeting given pursuant to NRS 81.939 or 81.941 must include, without limitation:

1. The place, date and time of the meeting;

2. A description of the general nature of the matters before the board of directors or members, as applicable;

3. If a director is to be elected, the names of each of the candidates for such a position; and

4. If applicable, information regarding the electronic or video transmission of the meeting.

(Added to NRS by 2019, 910)

NRS 81.945 Means of providing notice; affidavit is prima facie evidence of proper notice.

1. Except as otherwise provided in NRS 81.941, notice may be provided by:

(a) Personal service;

(b) Electronic transmission;

(d) Any other means of written communication.

2. An affidavit executed by a secretary, assistant secretary or transfer agent of a worker cooperative attesting that notice was served in accordance with NRS 81.939 to 81.949, inclusive, shall be deemed prima facie evidence that proper notice was given by the worker cooperative.

(Added to NRS by 2019, 910)

NRS 81.947 Address of notice to last known address in records; notice if no known address in records; notice if mailed notice is returned as undeliverable.

1. Except as otherwise provided in subsection 2, notice of a meeting given by mail or through other written communication pursuant to NRS 81.945 must be addressed to a member at his or her last known address as provided in the records of the worker cooperative.

2. If there is no known address of a member in the records:

(a) The worker cooperative must use the address of the principal place of business of the worker cooperative; or

(b) The notice must be published, one time, in a newspaper of general circulation in the county in which the principal place of business of the worker cooperative is located.

3. If a mailed notice of a meeting is returned by the United States Postal Service as being undeliverable to an address of a member, all future such notices shall be deemed to have been duly given unless the member makes a written demand to the worker cooperative for a copy of the notice, at which time the notice must be provided by the worker cooperative to the member if the demand was made within 1 year after the original notice was returned as undeliverable.

(Added to NRS by 2019, 910)

NRS 81.949 Electronic notice of meeting not authorized in certain circumstances. Notice of a meeting may not be given by electronic transmission pursuant to NRS 81.945 if:

1. A worker cooperative is unable to deliver two consecutive notices to the member by electronic transmission; or

2. A secretary, assistant secretary, transfer agent or any other person knows that the notice is unable to be delivered by electronic transmission.

(Added to NRS by 2019, 911)

NRS 81.951 Meetings adjourned to another time or place.

1. Unless otherwise provided by the articles of incorporation or bylaws of a worker cooperative, when a meeting is adjourned to another time or place, notice of the adjournment need not be given to the members of the original meeting if the time and place that the meeting will commence is announced before the adjournment.

2. If an adjournment pursuant to subsection 1 is taken for more than 45 days, or if a new record date is set after an adjournment, notice of the adjournment must be given in accordance with NRS 81.939 to 81.951, inclusive, to each member entitled to vote.

3. At the commencement of the adjourned meeting, the worker cooperative may transact any business that would have been transacted at the original meeting.

(Added to NRS by 2019, 911)

NRS 81.953 Validity of business transacted at meeting that does not meet notice requirements; waivers of notice.

1. Any business transacted at a meeting that does not meet the notice requirements pursuant to NRS 81.939 to 81.951, inclusive, is valid if:

(a) There was a quorum of the members present at the meeting; and

(b) Each member not present at such a meeting:

(1) Was provided a written waiver of the notice;

(2) Consented to the holding of the meeting without his or her presence; or

(3) Approved the minutes of the meeting in writing.

2. The attendance of a person at a meeting constitutes waiver of the notice pursuant to subsection 1 unless the person objects at the beginning of the meeting to the transaction of business at the meeting on the basis of improper notice pursuant to NRS 81.939 to 81.951, inclusive.

3. A written waiver of notice is not required to include a provision for each item of business to be transacted at a meeting unless otherwise specified by the articles of incorporation or bylaws of the worker cooperative.

(Added to NRS by 2019, 911)

NRS 81.955 Use of written ballots.

1. Unless otherwise prohibited by the articles of incorporation or bylaws of a worker cooperative, the board of directors of the worker cooperative may authorize the distribution of a written ballot to every member entitled to vote at a meeting.

2. A ballot distributed pursuant to subsection 1 must:

(a) Set forth any proposed action to be taken at the meeting;

(b) Provide an opportunity for the member to approve or disapprove of any action; and

(c) State that unless the ballot is revoked by a member, the ballot will be counted if received by the worker cooperative on or before the time of the meeting.

3. A ballot may be revoked by a member pursuant to subsection 2 by the physical appearance and casting of a vote of the member at the meeting.

4. For the purposes of the subject matter of a written ballot, an unrevoked ballot is equivalent to the physical presence of a member at the meeting for purposes of determining a quorum.

5. If cumulative voting is permitted by the articles of incorporation or bylaws of a worker cooperative and the distribution of ballots is not prohibited pursuant to subsection 1, a ballot may be distributed for the election of a director.

(Added to NRS by 2019, 911)

Revocation of Election and Mergers

NRS 81.957 Revocation of election to be governed as worker cooperative.

1. A worker cooperative may revoke its election to be governed as a worker cooperative pursuant to NRS 81.919:

(a) In a manner as provided by the articles of incorporation or bylaws of the worker cooperative, but by not less than a majority vote of the members; and

(b) Through a certificate of amendment filed pursuant to chapter 78 of NRS.

2. A worker cooperative that revokes its election pursuant to subsection 1 shall, in its certificate of amendment, provide for the conversion of membership shares and internal capital accounts or their conversion to securities or other property in a manner consistent with chapter 78 of NRS.

(Added to NRS by 2019, 913)

NRS 81.959 Consolidation or merger.

1. A worker cooperative that has not revoked its election pursuant to NRS 81.919 shall not consolidate or merge with another corporation unless such a corporation is also a worker cooperative.

2. Two or more worker cooperatives may merge in a manner consistent with chapters 78 and 92A of NRS.

(Added to NRS by 2019, 913)