Article I Organization

Section 1.1 - Name and status. The name of the organization is Long Beach Grocery Co-op, Inc. (referred to in these bylaws as "the Cooperative"). The Cooperative is a cooperative corporation under the laws of the State of California (12200 et. seq.).

Section 1.2 - Purpose and mission. The Cooperative is organized and shall be operated primarily for the mutual benefit of its Owner-Members as patrons of the Cooperative. The Cooperative shall be operated exclusively on a cooperative basis. The mission of the Cooperative is to provide a customer-owned food cooperative offering natural, local, and organic products at reasonable prices while supporting the local economy, providing food education, advocating for environmentally sustainable practices and supporting food justice principles. We envision a healthy community, with equitable access to quality food in a vibrant and welcoming market, where anyone can be an Owner-Member, and everyone can shop.

  Section 1.3 - Cooperative principles. The Cooperative shall be operated in accordance with the cooperative principles adopted by the 1995 General Assembly of the International Co-operative Alliance, such principles being:

(i)              voluntary and open membership without arbitrary discrimination

(ii)             democratic governance

(iii)            economic participation by members

(iv)            autonomy and independence of the Cooperative

(v)             providing education and training

(vi)            cooperation with other cooperatives; and

(vii)          concern for community

Section 1.4 - Nondiscrimination. The Cooperative shall not arbitrarily discriminate on the basis of race, religious creed, color, national origin, ancestry, physical disability, mental disability, medical condition, genetic information, marital status, sex, gender, gender identity, gender expression, age, sexual orientation, and military or veteran status.

Article II Ownership

Section 2.1 - Eligibility. Ownership in the Cooperative shall be voluntary and open to any household (any family or group of people living under one roof) or organization whose intent is to make purchases from the Cooperative for household or organizational use and who is willing to accept the responsibilities of Owner-Membership. If any doubts arise concerning eligibility within six months after the date of application, an application for Owner-Membership shall be subject to approval by the Board.

Section 2.2 - Admission. Applicants will be admitted to Owner-Membership upon submitting required information and purchasing one share. One share is $250.00. Each member is entitled to one share as provided under Section 2.1. On or before admission to Owner-Membership, each Owner-Member shall be provided a copy of these bylaws and a separate Owner-Membership disclosure statement. The share purchase requirement may be permitted to be paid in installments and special accommodation may be provided to low-income persons, as determined by the Board of Directors.

Section 2.3 - Rights. Except as otherwise provided in these bylaws, each member of a household Owner-Member or authorized representative(s) of an organizational Owner-Member shall be entitled to make purchases from the Cooperative on terms generally available to Owner-Members. Each Owner-Member, including an authorized agent of an organizational Owner-Member, shall be entitled to participate in the governance of the Cooperative as set forth in these bylaws. Except as otherwise provided herein, persons who have subscribed for but not fully paid for a share shall be considered Owner-Members. Owners shall be provided reasonably adequate and timely information as to the operational and financial affairs of the Cooperative at meetings of Owner-Members or otherwise.

Section 2.4 - Responsibilities. Each Owner-Member shall keep current (see 2.5 below) in payment of the share purchase requirement described in Section 2.2 above, shall patronize the Cooperative, and shall notify the Cooperative of any change to his or her name or address.

Section 2.5 - Inactive status. An Owner-Member who becomes delinquent by two months in meeting the share purchase obligation, or who fails to patronize the Cooperative for one year, shall be placed into inactive status, provided the Owner-Member is given fair notice and an opportunity to respond in person or in writing no less than fifteen days before the effective date of the action. Inactive status shall result in the suspension of all rights and entitlements of Owner-Members. An Owner-Member in inactive status may re-attain good standing upon recommencing payment of required shares or reestablishing a patronage relationship with the Cooperative.

Section 2.6 - Access to information. An Owner-Member shall, upon request made in apparent good faith, be provided information concerning the operational and financial affairs of the Cooperative for a purpose reasonably related to such person's interest as an Owner-Member. Any proper request necessitating information from the Cooperative's records of Owner-Members shall meet the requirements of the Consumer Cooperative Corporation Law (12600 et.seq.) and shall be accommodated by means other than direct access to such records.

Section 2.7 - Settlement of disputes. In any dispute between the Cooperative and any of its Owner-Members or former Owner-Members which cannot be resolved through informal negotiation, it shall be the policy of the Cooperative to prefer the use of mediation whereby an impartial mediator may facilitate negotiations between the parties and assist them in developing a mutually acceptable settlement. Neither party with a grievance against the other shall have recourse to litigation until the matter is submitted to mediation and attempted to be resolved in good faith.

Section 2.8 – Nontransferability. Ownership rights and interests, including shares and deferred patronage dividends, may not be sold, assigned, or otherwise transferred by the Owner-Member. However, following termination of Owner-Membership, the Cooperative may upon request of the Owner-Member transfer the carrying value of such rights and interests, net of any authorized offsets, to the credit of another person designated by the requesting Owner-Member, provided that the transfer is for a price that does not exceed the carrying value of such rights and interests and that the person so designated is or becomes an Owner-Member of the Cooperative. Any attempted transfer contrary to this section shall be wholly void and shall confer no rights on the intended transferee.

Section 2.9 - Withdrawal and expulsion. An Owner-Member may withdraw at any time upon notice to the Cooperative. An Owner-Member may be expelled by the Board for cause after being provided 15 days’ prior notice of the expulsion and the reasons therefore and being provided an opportunity to respond in person or in writing not less than five days before the effective date of the expulsion. Upon termination of Owner-Membership, all rights and interests in the Cooperative shall cease except for rights to redemption of capital pursuant to Articles VII and VIII of these bylaws.

Section 2.10 - Return of Equity. Equity may be returned upon termination of membership in the Cooperative, under terms determined by the Board, provided that the Board has determined that the equity is no longer needed by the cooperative.

Section 2.11 - Unclaimed Equity. If a member-owner voluntarily or involuntarily terminates membership in the cooperative and fails to inform the cooperative of his or her mailing address, then the equity and patronage dividend amount allocated to that member-owner will be retained by the cooperative or donated to a non-profit to the extent authorized by state law.

Upon the death of an Owner-Member, the designated beneficiary in the household of such person may inherit the rights and interests of such person, provided a copy of the death certificate is submitted to the Cooperative. The beneficiary must complete a new application and be willing to pay any outstanding balance.

Article III Meetings of Owners

Section 3.1 - Annual meeting. An annual meeting of Owner-Members shall be held each year at a time and place determined by the Board to receive reports on the operations and finances of the Cooperative and to conduct such other business as may properly come before the meeting.

Section 3.2 - Special meetings. Special meetings of Owner-Members may be called by the Board and shall be called by the President as soon as practicable after the receipt of petitions signed by fifteen percent of all Owner-Members, such petitions stating any proper business to be brought before the meeting.

Section 3.3 - Time and place. The date, time, and place of all meetings of Owner-Members shall be determined by the Board or, if the Board fails to so act, by the Secretary. Meetings shall be held at a place convenient to Owner-Members.

Section 3.4 - Notice. Written notice, electronic or otherwise, of the time, place, and purpose or purposes of all meetings of Owner-Members shall be provided to each Owner-Member not less than fourteen nor more than sixty days before the date of the meeting. The notice of the annual meeting shall advise Owner-Members that a copy of the Cooperative's annual report containing such information as is required by section 12591 of the Consumer Cooperative Corporation Law will be provided upon request. Notice shall also be posted at the Cooperative's store and on its website, but the inadvertent failure to do either or both shall not affect the validity of the meeting. Any business conducted at a meeting other than that specified in the notice of the meeting shall be of an advisory nature only.

Section 3.5 - Record dates. Unless otherwise determined by the Board, only persons who are Owner-Members at the close of business on the day immediately preceding the date of distribution of notices shall be entitled to notice and to vote with respect to the subject of such notice.

Section 3.6 - Quorum. The presence in person, or electronic transmission, by and to the Cooperative, or by electronic video screen communication, or by ballot at the opening of the meeting of 100 Owner-Members or fifteen percent of all Owner-Members, whichever is lesser, shall be necessary and sufficient to constitute a quorum for the transaction of business at any meeting of Owner-Members.

Section 3.7 - Voting. Unless otherwise required by these bylaws, each Owner-Member shall have one and only one vote on each matter submitted to a vote of Owner-Members. Voting by proxy shall not be permitted. Votes shall be cast by the voting representative of the Owner-Members. Unless otherwise required by law or by these bylaws, issues shall be decided by a simple majority of votes cast except where one or more choices are to be made from several alternatives, in which case the alternative(s) receiving the most votes shall be considered approved. Meetings of Owner-Members shall be conducted generally in accordance with reasonable and accepted rules of parliamentary procedure. The Board shall institute policies and procedures to reasonably assure the integrity of the voting process.

Section 3.8 - Voting by written ballot. Owners may, as authorized by the Board, vote by written, or electronic, ballot delivered to the Cooperative by the voting representative of the Owner-Member household or organization. Ballots, together with the exact text of an issue for decision shall be included in the notice of the meeting to which they relate. Casting of a written, or electronic, ballot shall be equivalent to presence in person at a meeting, and ballots shall be counted together with votes cast at the meeting, if any. In the case of balloting separate from a meeting, voting by ballot shall for all purposes be considered a meeting of Owner-Members.

Section 3.9 - Issues submitted by Owner-Members. Notices of a meeting of Owner-Members shall include any proper issue submitted by petition of at least ten percent of all Owner-Members. Petitions must be received by the Cooperative not less than seventy-five days before the date of the meeting at which they are to be presented to a vote of Owner-Members.

Article IV Board of Directors

Section 4.1 - Powers and duties. Except as to matters reserved to Owner-Members by law or by these bylaws, the business and affairs of the Cooperative shall be managed under the direction and supervision of the Board of Directors (sometimes referred to in these bylaws as "the Board"). Such powers shall reside exclusively in the Board as a deliberative body; they may reside in individual directors only to the extent explicitly so delegated by the Board. The duties of the Board shall include, but not be limited to, overseeing the operations and finances of the Cooperative, establishing policies to govern operational decisions, establishing compensation, engaging a general manager and monitoring and evaluating his or her performance, securing good conditions of employment, and assuring that the purpose and mission of the Cooperative are properly carried out.

Section 4.2 - Number and qualifications. The Board shall consist of seven to nine individuals. To be qualified as a director:

(i)               commit to Board Orientation and on-going Board education

(ii)             shall have been an Owner-Member of a household or an organization that has been an Owner-Member for at least six months prior to the commencement of the election of directors

(iii)            shall not have a personal agenda inimical to the Cooperative or be prone to disrupting the orderly functioning of the board or have an overriding conflict of interest with the Cooperative.

No employees, spouses or domestic partners of employees shall be eligible to serve as a director.

Section 4.3 - Nominations, election, and terms. Directors may be nominated by the Board, by a nominating committee, or by petitions signed by at least fifty Owner-Members, which petition prominently discloses to signers that the Cooperative has refused or failed to nominate this person. Petitions shall be submitted to the Cooperative at least sixty days before the date of the annual meeting. Directors shall be elected by Owner-Members. At or in connection with the first annual meeting after adoption of these bylaws and periodically thereafter as may be necessary, directors shall be elected for specific one-, two- or three-year terms to assure that no more than three terms expire in each year. At other times directors shall be elected for terms of three years. Candidates receiving the highest number of votes shall be given the longest available terms. Directors shall hold office until their successors are elected or until their offices are sooner terminated in accordance with these bylaws.

In the event a vacancy occurs, a director may be appointed by the existing nominating committee.  The nominating committee shall begin by looking at previous nominations.

Section 4.4 - Compensation. Directors may be reimbursed for reasonable expenses incurred in connection with the performance of authorized business of the Cooperative.

Section 4.5 - Standards of conduct. Directors shall always be responsible for performing their duties in good faith, in a manner that they believe to be in the best interests of the Cooperative, and with such care, including reasonable inquiry, as an ordinarily prudent person in a like position would use under similar circumstances.

Section 4.6 - Conflicts of interest. Directors shall be under an affirmative duty to disclose their actual or potential conflicts of interest, either direct or indirect, in any matter under consideration by the Board or by a committee exercising any authority of the Board, and such interest shall be made a matter of record in the minutes of the meeting. A director or Owner-Member of a committee having such an interest shall be permitted to make a statement regarding the matter but shall not be permitted to participate in the discussion or decision of the matter.

Section 4.7 - Indemnification. The Cooperative shall indemnify its directors and officers as required by and may indemnify its directors and officers as permitted by state law. Indemnification payments shall be made on a priority basis but only in such increments and at such times as will not jeopardize the ability of the Cooperative to pay its other obligations as they become due. Any indemnification payments or advances shall be reported to Owner-Members not later than the next-scheduled meeting of Owner-Members.

Section 4.8 - Committees. The Board may appoint special or standing committees to advise the Board or to exercise such authority as the Board shall designate. Such committees shall include at least one director. The appointment of any committee shall not relieve the Board of its responsibilities in the oversight of the Cooperative.

Section 4.9 - Termination. The term of office of a director may be terminated prior to its expiration in any of the following ways:

(i)               voluntarily by a director upon notice to the Secretary

(ii)             automatically upon termination of Owner-Membership in the Cooperative

(iii)            by action at a meeting of Owner-Members. A director who is absent from three Board meetings within a period of one year shall, unless excused by the Board for good cause, be presumed to have resigned. If it becomes apparent to the board that a director did not and does not meet a required qualification for a director, and did not disclose such matter, the board may presume such director to have resigned.

Section 4.10 - Vacancies. Any vacancy among directors occurring between annual meetings may be filled by the Board until the next annual meeting of Owner-Members, at which time Owner-Members shall elect a director to fill the unexpired term of the vacant director's position.

Article V Meetings of the Board

Section 5.1 - Meetings. Meetings of the Board shall be held no less frequently than once in each two-month period. Meetings not called by the Board (special meetings) may be called by the President and shall be called by the Secretary upon request of any three directors. Meetings shall be open to all Owner-Members unless the Board decides to go into executive session regarding confidential or proprietary matters such as: labor relations or personnel issues; negotiation of a contract; discussion of strategic goals or business plans, the disclosure of which would adversely impact the Cooperative’s position in the marketplace; and/or discussion of a matter that may, by law or contract, be considered confidential.

Section 5.2 - Notice. Meetings called by the Board shall require no notice, it being the responsibility of absent directors to inquire as to the time of further scheduled meetings. Special meetings shall require written or oral notice to all directors. Written notice shall be delivered at least four days before the date of the meeting and oral notices shall be given in person or by a telecommunications device at least forty-eight hours before the time of the meeting. Notices of meetings of the Board shall also be posted in a timely manner and in a conspicuous place in the Cooperative's store, but the inadvertent failure to do so shall not affect the validity of the meeting.

Section 5.3 - Waiver of notice. Any notice of a meeting required under these bylaws may be waived in writing at any time before or after the meeting for which notice is required. A person who attends a meeting other than for the sole purpose of objecting to the adequacy of the notice shall be deemed to have waived any objection to the notice.

Section 5.4 - Quorum. The presence in person or by a means in conformity with CCCL § 12351 of a majority of directors shall be necessary and sufficient to constitute a quorum for the transaction of business at any meeting of the Board.

Section 5.5 - Decision making. Decisions at meetings of the Board shall be made by consensus, whereby decisions are reached by common consent, with differing points of view being reconciled based upon the best interests of the Cooperative. If diligent efforts have failed to produce a consensus and immediate action is required, then the issue may be decided by a two-thirds majority vote.

Section 5.6 - Action without a meeting. Any action required or permitted to be taken by the Board may be taken without a meeting if all directors shall individually or collectively consent in writing to that action. Such written consent or consents shall be filed with the minutes of the proceedings of the board.

Article VI Officers

Section 6.1 - Designation and qualifications. The principal officers of the Cooperative shall consist of President, Vice President, Secretary and Treasurer. Principal officers shall be directors. The Board may designate other officers or assistant officers.

Section 6.2 - Election, terms, and removal. Officers shall be elected by the Board at its first meeting following the annual meeting of Owner-Members. Officers shall serve for terms of one year or until election of their successors. Officers may be removed and replaced by the Board at any time whenever the best interests of the Cooperative would thereby be served.

Section 6.3 - Duties. In addition to signing or attesting to formal documents on behalf of the Cooperative as authorized by the Board, officers shall have the following duties and such additional duties as are determined by the Board:

(a)           The President shall be responsible for coordinating the activities of the Board, assuring the orderly conduct of all meetings, maintaining effective communication with the general manager, and shall present a report of operations at the annual meeting of Owner-Members.

(b)          The Vice President shall be responsible for performing the duties of the President in his or her absence or disability and assisting the President in the performance of his or her duties.

(c)          The Secretary shall be responsible for the recording and keeping of adequate minutes of all meetings of the Board and of Owner-Members, overseeing the issuance of notices required under these bylaws and executing affidavits of notice given, and authenticating records of the Cooperative.

(d)          The Treasurer shall be responsible for monitoring the maintenance of financial records, the compilation of financial reports, and the filing of required reports and returns, and shall present a financial report at the annual meeting of Owner-Members.

Article VII Shares

Section 7.1 - Issuance and terms. The Cooperative shall issue shares to evidence capital funds provided by Owner-Members. Shares may be issued only to persons eligible for, and admitted to Owner-Membership in, the Cooperative. They shall have an issuing price of two hundred and fifty dollars per share and shall be considered issued upon full payment of their stated value without need for issuance of any certificate. They shall be entitled to no dividend or other monetary return on contributed capital. The share purchase requirement shall be subject to increase for the reasonable capital needs of the Cooperative.

Section 7.2 - Redemption. Upon request following termination of Owner-Membership, shares shall be redeemed, but only after two years from date of the latest payment for a share and subject to the discretion of the Board. Shares shall be redeemable at face value less a reasonable processing fee, if any, as determined by the Board. Redemption proceeds shall be subject to offset by amounts due and payable to the Cooperative by the Owner-Member. No redemption shall be made when such payment would impair the ability of the Cooperative to meet its other obligations as they become due. Reapplications for Owner-Membership after full or partial redemption shall be subject to full repayment of redemption proceeds.

Article VIII Patronage Dividends

Section 8.1 - Distribution obligation. The realized net earnings of the Cooperative attributable to the patronage of Owner-Members shall be allocated and distributed among Owner-Members in proportion to their patronage and in such a manner and at such a time as to constitute patronage dividends within the meaning of federal income tax law.

Section 8.2 - Consent of Owner-Members. By obtaining or retaining Owner-Membership in the Cooperative, each Owner-Member shall thereby consent to how patronage dividends are required to be included in the taxable incomes of recipient Owner-Members. Section 1385(b) of the Internal Revenue Code provides that a patronage dividend shall not be included in the taxable income of a recipient to the extent that such amount "is attributable to personal, living, or family items." This exclusion from taxable income would apply to Owner-Members whose purchases from the Cooperative were for such personal use. To such persons section 8.2 is therefore of no effect. To all other Owner-Members section 8.2 represents their consent to include the amount of their patronage dividend in their taxable incomes for the year in which they receive their patronage dividend notice and check. This consent would apply to Owner-Members who are organizations and others whose purchases from the Cooperative were for business or income-producing purposes.

Each Owner-Member also agrees that if his or her patronage dividend is not cashed within 90 days of the date on which it was issued by the Cooperative, the Cooperative shall have the right to make a contribution in the name of that Owner-Member to support other organizations aligned with the Cooperative’s purpose in a manner as may be directed by the Board from time to time.

Section 8.3 - Deferred amounts. Payment of a portion of patronage dividends not to exceed eighty percent of the allocation may be deferred for the reasonable capital needs of the Cooperative, as determined by the Board. Such amounts shall be credited to revolving capital accounts in the names of recipient Owner-Members and shall accrue no dividend or other monetary return on capital. Deferred patronage dividends may be redeemed when determined by the Board to be no longer needed for capital purposes. At that time, they shall be redeemed in the order of the oldest outstanding amounts and on a pro rata basis among such amounts. Deferred patronage dividends may also be redeemed under compelling circumstances as determined by the Board. They shall be subject to being offset by amounts otherwise due and payable to the Cooperative and by assessments resulting from tax audit adjustments.

Section 8.4 - Net losses. No portion of a net operating loss realized by the Cooperative shall be allocated to Owner-Members. The patronage portion of such losses shall be carried forward to offset patronage-sourced income of subsequent years. The nonpatronage portion of such losses shall be carried back and forward to offset nonpatronage-sourced income of prior and subsequent years as required or permitted under federal income tax law.

Article IX Fiscal and Miscellaneous Matters

Section 9.1 – Fiscal year. The fiscal year of the Cooperative shall be from January 1 to December 31 of the calendar year.

  Section 9.2 – Communication by electronic means. Unless otherwise required by these bylaws, any notice, consent, ballot, petition, or other document required or permitted by these bylaws may be delivered by electronic means, provided that, in the case where such communication expressly or impliedly requires the signature of the person submitting the communication, means are in place to reasonably assure the authenticity of the signature.

Section 9.3 - Transfer of proprietary interests. Shares and deferred patronage dividends that are unclaimed and would otherwise escheat to the state shall become the property of the Cooperative after the following requirements are satisfied:

(i)     the articles or bylaws shall specifically provide for the transfer of Owner-Membership of the otherwise escheated proprietary interests to the Cooperative

(ii)   at least 60 days prior to the proposed transfer the Owner-Member is given notice by first-class or second-class mail to the last address of the Owner-Member shown on the Cooperative's records and by publication in a newspaper of general circulation in the county in which the Cooperative has its principal office

(iii)  no written notice objecting to the proposed transfer is received by the Cooperative from the affected Owner-Member prior to the date of the proposed transfer. Upon such occurrences, the Owner-Member shall be deemed to have made a gift of such interests to the Cooperative as of the effective date of such transfer.

Section 9.4 - Loans prohibited. The Cooperative shall not make a loan to, or guarantee the obligation of, a director officer.

Section 9.5 - Liquidation. The Cooperative may be dissolved or liquidated upon a decision of the Board and a two-thirds (2/3) vote of the member-owners who participate in the vote. Upon liquidation and dissolution of the Cooperative, its assets shall be distributed in the following manner and order:

(i)               by paying or making provision for payment of all liabilities and expenses of liquidation

(ii)             by redeeming deferred patronage dividends, if any, which, if they cannot be paid in full, shall be paid on a pro rata basis among all outstanding amounts

(iii)            by redeeming shares at their carrying value on the books of the Cooperative which, if they cannot be paid in full, shall be paid on a pro rata basis among all outstanding amounts

(iv)            by distributing any remaining assets in a manner that furthers the purposes and mission of the Cooperative.

Article X Interpretation and Amendment of Bylaws

Section 10.1 - Interpretation. The Board of Directors shall have the power to interpret these bylaws, apply them to particular circumstances, and adopt policies in furtherance of them, provided that all such actions are reasonable and consistent with these bylaws.

Section 10.2 - Severability. If any provision of these bylaws is determined to be invalid or unenforceable under any statute or rule of law, then such provision shall be deemed inoperative to such extent and shall be deemed modified to conform with such statute or rule of law without affecting the validity or enforceability of any other provision of these bylaws.

Section 10.3 - Amendment. These bylaws may be amended or repealed only at a meeting of Owner-Members per Article III, provided that the proposed amendments are stated or fully described in the notice of the meeting at which the amendments are to be adopted.