Puget Consumers Co-op (“PCC”) conducts its business on a cooperative basis and is a consumer cooperative organized under the Washington Nonprofit Miscellaneous and Mutual Corporations Act, Chapter 24.06 of the Revised Code of Washington (the “Governing Statute”). As authorized by Section 24.06.032 of the Governing Statute, PCC elects to avail itself of the additional rights and powers granted to cooperative associations under RCW 23.86.105(1) (member liability limitation), 23.86.160 (apportionment of earnings) and 23.86.170 (distribution of dividends).
Section 1: Cooperative Purposes Report
1.1 Annual Cooperative Purposes Report
PCC will furnish a Cooperative Purposes Report to members annually by making this report publicly accessible, free of charge, at PCC’s principal internet website address. This report will address social, environmental and financial consumer cooperative purposes of PCC and its efforts to achieve or promote those purposes.
Section 2: Members
2.1.1 Membership Application and Fee
Any natural person 18 years of age or older who makes application in the form prescribed by the Board of Trustees of PCC (the “Board”) and pays the fee for application, membership or membership certificate purchase in the amount prescribed by the Board at the time of application may become a member. Applications for membership are presumed accepted by the Secretary of PCC (the “Secretary”) unless specifically disapproved in accordance with procedures and criteria established by the Board.
2.1.2 PCC Employee Automatic Membership
Any person who is an employee of PCC will automatically become a member for the duration of his or her employment without the need to comply with the provisions of Section 2.1.1 of these Bylaws. Any employee may also become a member independent of his or her employment status if he or she complies with the provisions of Section 2.1.1 of these Bylaws.
2.1.3 Active and Inactive Membership
The rights and privileges of “active” members (“Active Members”) and “inactive” members (“Inactive Members”) are stated in PCC’s Articles of Incorporation (the “PCC Articles”) and in these Bylaws. An Active Member will automatically become an Inactive Member if he or she fails to satisfy the requirements for active membership status stated in the PCC Articles or those established by the Board. An Inactive Member will again become an Active Member if he or she satisfies the requirements for active membership status stated in the PCC Articles or those established by the Board for membership reactivation.
2.1.4 Membership Certificates
PCC membership may be uncertificated or evidenced by certificates in such form as determined by the Board. Any member may request a certificate of membership by written notice to the Secretary.
2.1.5 Member Liability and Assessments
As and to the extent provided by applicable law, except for debts lawfully contracted between a member and PCC, no member shall be liable for the debts of PCC. No assessment may be made against any member except for full payment of the prescribed fee for application, membership or certificate purchase prescribed by the Board at the time of membership application.
2.1.6 Termination of Membership
Any member may terminate his or her membership by written notice to the Secretary. Any member whose activity endangers effective operation of PCC for the mutual benefit of its members, will be deemed to have voluntarily terminated his or her membership by virtue of such action. Any member may be expelled from membership by the Board for violation of policies adopted by the Board. The Board may adopt policies for reinstatement of any membership that has terminated or been subject to expulsion in accordance with this section, without requiring a new application or payment of an additional membership fee.
2.2 Annual Meeting
2.2.1 Time and Place of Meeting
The annual meeting of the members of PCC for the election of trustees and for the transaction of such other business as may properly come before the meeting is to be held each year at a place, day, and time set by the Board. The annual meeting may be held at more than one place at the direction of the Board.
2.2.2 Business Conducted at Meeting
(a) The Chair of the Board presides at and is the chairperson of every meeting of the members of PCC at which he or she is present. If the Chair of the Board is not present at a meeting, the trustees present at the meeting shall elect one trustee to be the chairperson. The order of business at each meeting of members is determined by the chairperson. The chairperson has the right and authority to prescribe such rules, regulations and procedures and to do all such acts and things as are necessary or desirable for the proper conduct of the meeting. (b) At any annual meeting of members, an item of business may be conducted, and a proposal (including an amendment to the PCC Articles or these Bylaws) may be considered and acted upon, only if it is brought before the meeting (i) by or at the direction of the Board or (ii) by an Active Member who is entitled to vote at the meeting and who complies with the procedures stated in Section 2.2.3.
2.2.3 Member Initiatives
For an item of business or proposal to be brought before a meeting by a member, the matter must be proposed by an Active Member and must concern (i) an amendment to the PCC Articles or these Bylaws, (ii) a statement of principle, or (iii) any other matter properly before the members. In addition, for the matter to be brought before an annual meeting, the Active Member must have delivered to the Secretary written notice no later than December 15 of the year prior to the annual meeting, which notice must describe the matter in reasonable detail and bear the physical signatures of at least 2% of all Active Members as of that date and the member must have complied with any other procedural guidelines and limitations the Board adopts. Submission of any matter to consideration or voting by the members will not diminish or override the ultimate authority of the Board to manage PCC’s affairs, except to the extent otherwise required by applicable law.
2.3 Special Meetings
Special meetings of the members may be called by the President or the Board or by persons representing at least 3% of all Active Members. Any special meeting properly called will be held at a date, time and place selected by the Board. If a special meeting is called by any person or persons other than the Board or the President, then a written demand, describing with reasonable clarity the purpose or purposes for which the meeting is called and specifying the nature of the business proposed to be transacted and bearing the physical signatures of at least 3% of all Active Members, must be delivered personally or sent by registered mail or by electronic transmission to the Secretary. Designation of the chairperson of the meeting for any special meeting and the conduct of such meeting will be in accordance with Section 2.2.2(a) of these Bylaws. No business other than that within the purpose or purposes specified in the meeting notice may be transacted at a special meeting.
2.4 Notice of meetings
The Secretary will give notice of any meeting of members, either in writing or by electronic transmission or in any other manner authorized under the Governing Statute, in the time period prescribed for consumer cooperatives by the Governing Statute, to all Active Members as of the record date for such meeting. Meeting notices will be accompanied by a written or electronic ballot relating to all matters to be voted on at the meeting.
No quorum of members is required to transact business at any meeting of members, unless otherwise required by the PCC Articles or the Governing Statute, except that (i) a quorum of 3% of the Active Members is required to consider and act on any matter brought before the meeting in accordance with Section 2.2.3 of these Bylaws and (ii) a quorum of 10% of the Active Members is required to consider and act on a plan of merger or consolidation; the sale, lease, exchange, or other disposition of all or substantially all of the property and assets of PCC; or the voluntary dissolution of PCC. Once a member is present at a meeting or has voted on any item of business considered at the meeting, whether voting by written or electronic ballot and regardless of whether the member votes on all items, the member is deemed to be present at the meeting for the purposes of determining whether a quorum exists.
2.6.1 Voting Entitlement of Members
Each Active Member is entitled to cast one vote in any election of trustees and on each other matter submitted to a vote of members. An Active Member may cast his or her vote solely by means of an executed written or electronic ballot. As used in this section, the term “executed” means (i) signed with respect to a written ballot or (ii) the initiation of an electronic transmission along with sufficient information to determine the sender’s identity with respect to an electronic ballot. Whether or not the Active Member is present in person at a meeting of members, his or her vote will be counted only if (i) it is submitted on the form of ballot furnished by the Secretary for use in connection with such meeting and (ii) the executed ballot is received by the Secretary no later than whatever deadline for ballot submissions the Board designates. No Active Member may vote by proxy or designee or acquire any interest that will entitle him or her to a greater vote than any other Active Member.
2.6.2 Voting for Matters other than the Election of Trustees
Except in situations where a greater or different vote is required under the Governing Statute, the PCC Articles or these Bylaws, action on any matter, other than the election of trustees, is approved if the votes cast favoring the matter exceed the votes cast opposing the matter. Action on any amendment to these Bylaws brought before a meeting by a member is approved if at least two-thirds of the votes cast on the matter are cast favoring the matter.
2.6.3 Voting for the Election of Trustees
(a) If the number of nominees for trustee does not exceed the number of trustees to be elected at any meeting, a nominee will be elected to the Board if the votes cast for that nominee’s election exceed the votes cast against that nominee’s election. A Board vacancy caused by the failure of a nominee to receive a sufficient number of votes shall be filled as set forth in Section 3.5 of these Bylaws. A person chosen by the Board to fill such vacancy will hold office only until the next meeting of members at which trustees are elected, and that person will be elected to continue serving the remaining term of the class for which such person has been chosen if the votes cast for his or her election exceed the votes cast against his or her election. (b) If the number of nominees for trustee exceeds the number of trustees to be elected at any meeting, the trustees will be elected by a plurality of the votes cast at that meeting. If trustees are to be elected by a plurality of the votes cast, members will not be permitted to vote against a nominee and the nominees elected to the Board are those receiving the largest numbers of votes cast, up to the number of trustees to be elected by the members.
2.7 Adjourned meetings
Any meeting of members may be adjourned and reconvened at another date, time, and place as the chairperson of the meeting determines without new notice being given if the date, time, and place are announced at the meeting at which the adjournment is taken. At the reconvened meeting, PCC may transact any business which might have been transacted at the original meeting.
2.8 Fixing record date
For the purpose of determining members entitled to notice of or to vote at any meeting of members, the Board may specify a date as the record date for determination of such members, which date must not be more than 90 days before the date of first mailing or electronic transmission of the meeting notice. If no record date is fixed, then the day 30 days before the date of first mailing or electronic transmission of the meeting notice will be the record date. When a record date has been fixed as provided in this section, that record date will apply to any adjourned meeting reconvened at a later time.
2.9 Electronic member meetings
Any meeting of members may be held by means of electronic or remote communications to the fullest extent permitted by and subject to the requirements of RCW 24.06.032(2)(c) and any other procedural guidelines and limitations the Board adopts.
2.10 Member information
3.1 Responsibility of board of trustees
The business and affairs and property of PCC are managed under the direction of the Board. In the management and control of the business and affairs and property of PCC, the Board is vested with all the powers possessed by PCC itself, so far as this delegation of authority is not inconsistent with the laws of the State of Washington, the PCC Articles or these Bylaws.
3.2 Number of trustees
The number of trustees constituting the Board is to be at least nine and not more than eleven, the specific number to be set by the Board. Nine trustees (the “elected trustees”) will be elected by the members and up to two trustees (the “appointed trustees”) may be appointed by a two-thirds majority vote of the elected trustees. No reduction of the authorized number of trustees will remove any trustee before that trustee’s term of office expires.
3.3 ELIGIBILITY TO BE A TRUSTEE
To be eligible for election or appointment as a trustee, a person (i) must be at the time of his or her election or appointment an Active Member and at least 21 years old, (ii) must not be limited by the term limits stated in Section 3.4.2 of these Bylaws, and (iii) must satisfy the standards of independence and non-competition and other reasonable eligibility requirements prescribed by the Board. In addition to the eligibility requirements stated above, an employee of PCC or a related person of a PCC employee is only eligible for election or appointment as a trustee if his or her election or appointment would not result in more than two PCC employees and/or related persons of PCC employees being trustees at any one time. If any election would otherwise result in more than two PCC employees and/or related persons of PCC employees being trustees at any one time, then only that person or those persons receiving the greatest number of votes in the election will be elected trustees such that there will not be more than two PCC employees and/or related persons of PCC employees being trustees. As used in these Bylaws, the term “related person” of an employee means the spouse, child, grandchild, sibling or parent of the employee, and any individual (other than a tenant or employee) sharing the household of the employee.
3.4 Election and appointment of trustees
3.4.1 Classification and Terms of Office
(a) The elected trustees will be divided into three classes of three trustees designated as Class I, Class II and Class III. Except in situations where shorter terms are expressly permitted under these Bylaws, elected trustees will be elected by members for terms of three years. The respective terms of the three classes will expire in three different consecutive years. (b) The terms of all elected trustees of a particular class begin on the date on which the voting results are determined for the annual meeting at which the class is elected and end on the date on which the voting results are determined for the third annual meeting held after the election of the class. (c) The term of each appointed trustee begins on the effective date of his or her appointment and ends on the date on which the voting results are determined for the next annual meeting held after his or her appointment.
3.4.2 Term Limits
(a) No person may be elected to serve as an elected trustee for more than three consecutive terms. For purposes of this term limit, a person who has been designated to fill the seat of an elected trustee whose seat has become vacant for any reason will be deemed to have been elected for the term of the previous trustee even if less than a full term. A person who has been elected to serve as an elected trustee for three consecutive terms may again be elected after a period of at least two years has elapsed since his or her last service as a trustee. (b) No person may be appointed to serve as an appointed trustee for more than two consecutive terms. A person who has been appointed to serve as an appointed trustee for two consecutive terms may again be appointed trustee after a period of at least two years has elapsed since his or her last service as a trustee. (c) A person is not eligible for election or appointment as a trustee if, by the end of the term to which he or she is to be elected or appointed, he or she would have served as a trustee for more than eleven consecutive years.
3.4.3 Nominations for Election as Trustees
(a) Nominations of candidates for election as trustees may only be made (i) by the nominating committee or (ii) by any Active Member who is entitled to vote at an annual meeting and who complies with the procedures stated in Section 3.4.3(b). The number of candidates nominated for election as trustees by the nominating committee at any annual meeting will not be fewer than that number of elected trustees whose terms end at the annual meeting and may not include any member of the nominating committee. (b) For a nomination to be made at a meeting by an Active Member (i) the member must have delivered to the Secretary written notice no later than December 15 of the year prior to the annual meeting, which notice must include all information concerning the nominee reasonably requested by PCC and bear the physical signatures of at least 2% of all Active Members as of that date and (ii) the member must have complied with any other procedural guidelines and limitations the Board adopts.
3.4.4 Nominating Committee
(a) The number of members constituting the nominating committee is to be at least four and not more than five. Up to four nominating committee members will be elected by the members (the “elected nominating committee members”) and one nominating committee member will be a trustee appointed by the Board (the “appointed nominating committee member”). The appointed nominating committee member may not be a trustee who is eligible for election as an elected trustee in the year for which the nominating committee serves. (b) To be eligible for election as a nominating committee member, a person (i) must be at the time of his or her election an Active Member and at least 21 years old, (ii) must not be a trustee during the term to which he or she would serve as an elected nominating committee member, (iii) must not be limited by the term limits stated in Section 3.4.4(d), and (iv) must satisfy the standards of independence and non-competition and other reasonable eligibility requirements prescribed by the Board. The Board may adopt such other procedural guidelines and limitations for the election of nominating committee members as it deems appropriate. An employee of PCC or a related person of a PCC employee is not eligible for election as a nominating committee member if his or her election would result in more than one PCC employee and/or related person of a PCC employee being an elected nominating committee member at any one time. If any election would otherwise result in more than one PCC employee and/or related person of a PCC employee being an elected nominating committee member at any one time, then only that person receiving the greatest number of votes in the election will be elected as a nominating committee member such that there will not be more than one PCC employee and/or related person of a PCC employee being an elected nominating committee member. (c) The elected nominating committee members will be divided into two groups designated as Group A and Group B, with the respective terms of the two groups expiring in alternating years. Except as stated below, elected nominating committee members will be elected by members for terms of two years with the terms of a particular group beginning on the date on which the voting results are determined for the annual meeting at which the group is elected and ending on the date on which the voting results are determined for the second annual meeting held after the election of the group. Candidates elected to the initial group designated as Group A will be elected to hold office for a term expiring on the date on which the voting results are determined for the first annual meeting held after the initial election of the group. Candidates elected to the initial group designated as Group B will be elected to hold office for a term expiring on the date on which the voting results are determined for the second annual meeting held after the initial election of the group. (d) No person may be elected to serve as an elected nominating committee member for more than two consecutive terms. A person who has been elected to serve as an elected nominating committee member for two consecutive terms may again be elected after a period of at least one year has elapsed since his or her last service as an elected nominating committee member. (e) Any vacancy occurring in the nominating committee (whether caused by fewer than the minimum number of elected nominating committee members being elected, resignation, death or otherwise) will be filled by appointment by the Board. (f) The nominating committee is to be governed by the same provisions as govern the actions, notice and waiver of notice, quorum and voting requirements, and standards of conduct of the Board.
Any vacancy occurring in the Board (whether caused by resignation, death, or otherwise) may be filled upon recommendation of the nominating committee by the affirmative vote of a majority of the trustees present at a meeting of the Board at which a quorum is present, or, if the trustees in office constitute less than a quorum, by the affirmative vote of a majority of all of the trustees in office. Except as set forth in Section 2.6.3(a) of these Bylaws, a person chosen by the Board to fill a vacancy in any class of elected trustees shall serve as an elected trustee for the remainder of the term of that class (or until his or her earlier resignation, removal or death).
A trustee may resign at any time by delivering written notice to the Board, its Chair, the President, or the Secretary. A resignation is effective when the notice is delivered unless the notice specifies a later effective date.
3.7 Regular meetings
Regular meetings of the Board may be held at such place, day, and time as determined by the Board without notice other than in accordance with Section 3.9 of these Bylaws.
3.8 Special Meetings
Special meetings of the Board may be called by the Chair of the Board or by any three or more trustees, to be held at such place, day, and time as specified by the person or persons calling the meeting with notice provided in accordance with Section 3.9 of these Bylaws.
3.9 Notice of meeting
Notice of the place, day, and time of any meeting of the Board for which notice is required must be given to each trustee, at least two days before the day on which the meeting is to be held, by the Secretary or by the person calling the meeting, in any manner permitted by law, including orally or via electronic transmission. Notice is to be deemed given on the earliest of (i) the day of actual receipt, (ii) five days after the day on which written notice is deposited in the United States mail, as evidenced by the postmark, with first-class postage prepaid, and correctly addressed, (iii) on the date shown on the return receipt, if sent by registered or certified mail, return receipt requested, and the receipt is signed by or on behalf of the addressee, or (iv) on the date of transmission if transmitted electronically during normal business hours of the trustee or on the next business day if after business hours. No notice of any regular meeting of the Board need be given if the place, day, and time thereof is posted on an electronic network and notice of such posting is electronically transmitted to each trustee at least 30 days before the day on which the meeting is to be held. Notice of a meeting of the Board need not be given to any trustee if it is waived by the trustee in writing, whether before or after such meeting is held.
3.10 Quorum of trustees
Except as otherwise required by law, a majority of the number of trustees in office constitutes a quorum for the transaction of business, and the affirmative vote of a majority of the trustees present at a meeting at which a quorum is present will be the act of the Board unless a greater number is required by the PCC Articles.
3.11 Action by trustees without a meeting
Any action which must or may be taken at a meeting of the Board or any committee thereof may be taken without a meeting if all trustees (or in the case of a committee, all members of such committee) consent to taking such action without a meeting. The action must be evidenced by one or more written consents describing the action taken, executed either before or after the action so taken by all of the trustees or committee members, as applicable, and must be included in the minutes or filed with the corporate records reflecting the taking of such action. Such consent has the same effect as a meeting vote. Action taken under this section is effective when the last trustee or committee member, as applicable, executes the consent, unless the consent specifies a later effective date. For purposes of this section, a “written consent” includes an electronic transmission and such consent is “executed” when the electronic transmission is initiated and includes sufficient information to determine the sender’s identity.
PCC shall pay the expenses of each trustee, if any, for attendance at Board meetings. PCC shall also pay compensation for Board service to each trustee who is not also serving as an executive officer of PCC in an amount determined by the Board.
The Board may create, and appoint individuals to, one or more committees, each of which must have at least two persons. If a committee is formed for the purpose of exercising functions of the Board, the committee must consist solely of trustees. If the only function of a committee is to study and make recommendations for action by the full Board, the committee need not consist solely of trustees. Any committee consisting solely of trustees may exercise the authority of the Board to the extent such authority is expressly delegated to such committee by the Board or in the PCC Articles or these Bylaws. Committees are to be governed by the same provisions as govern the meetings, actions without meetings, notice and waiver of notice, quorum and voting requirements, and standards of conduct of the Board.
3.14 Conflicts of interest
Subject to the provisions of these Bylaws, the PCC Articles and applicable law, the Board may authorize any transaction or matter that would involve a trustee or an officer having an actual or potential conflict of interest. Whenever a trustee or officer has a financial or personal interest in any transaction or matter coming before the Board, the trustee who has a conflicting interest must disclose to the Board (i) the existence and nature of the conflicting interest and (ii) all facts known to the trustee respecting the transaction or matter that an ordinarily prudent person would reasonably believe to be material to a judgment about whether or not to proceed with the transaction or matter. The Board’s action respecting such transaction or matter is effective if a majority of disinterested trustees on the Board consents to such action.
Section 4: Officers
The executive officers of PCC shall be appointed annually by the Board. Except in the case of death, resignation, or removal, each executive officer will hold office until his or her successor is appointed and qualified.
The executive officers of PCC include the President, the Secretary and such other executive officers as the Board designates. The executive officers will have those responsibilities and powers as are customarily associated with their respective offices, subject to such limitations or additional powers as the Board prescribes.
Any executive officer may be removed by the Board with or without cause. The removal of an executive officer is to be without prejudice to the contract rights, if any, of PCC or the person so removed. Appointment of an executive officer does not of itself create contract rights.
Section 5: Indemnification and insurance
In addition to the immunities and releases from liability conferred by RCW Secs. 4.24.264, 23B.08.320 and 24.06.035, PCC shall indemnify its current and former trustees, officers, employees and agents against any expense, loss or damages incurred by them in connection with or arising out of their service in such capacities, to the fullest extent allowed by law under any circumstances. Without limiting this undertaking, which is not exclusive, PCC may also provide indemnification and other benefits to its current and former trustees and officers in separate agreements approved by the Board. Whether or not any such separate agreement has been entered into, the right to indemnification conferred in this Section 5 is a contract right upon which each beneficiary hereof will be presumed to have relied. Any amendment to or repeal of this Section 5 will not adversely affect any right or protection of any current or former trustee, officer, employee or agent for or with respect to any acts or omissions of such individual occurring before such amendment or repeal.
Expenses (including reasonable attorneys’ fees) incurred by a trustee or an officer in defending a civil, criminal, administrative or investigative action, suit or proceeding shall be paid by PCC in advance of the final disposition of such action, suit or proceeding upon receipt of an undertaking by or on behalf of such trustee or officer to repay such amount if it is ultimately determined that he or she is not entitled to be indemnified by PCC as authorized in this Section 5. Such expenses incurred by other employees and agents may be so paid upon such terms, if any, as the Board deems appropriate.
PCC has the authority to purchase and maintain insurance on behalf of any person who is or was a trustee, officer, employee or agent of PCC, or is or was serving at the request of PCC as a trustee, officer, employee or agent of another entity or enterprise, against any liability asserted against him or her and incurred by him or her in any such capacity, or arising out of his or her status as such, whether or not PCC would have the authority to indemnify him or her against such liability under this Section 5.
5.4 No retroactive impairment of rights
No alteration, amendment or repeal of these Bylaws or adoption of new Bylaws will impair, alter in an adverse manner or reduce or diminish the rights and benefits of any current or former trustee, officer, employee or agent under this Section 5 except with the advance written consent of each individual so affected.