KRS 279.510: Obligations, how issued, secured, purchased or redeemed -- Power of

board of trustees to encumber or dispose of property.

(1) The board of trustees of a cooperative shall have full power and authority, without

authorization by the members thereof, to authorize the execution and delivery of a

mortgage or mortgages or a deed or deeds of trust of, or the pledging or

encumbering of, any or all of the property, assets, rights, privileges, licenses,

franchises and permits of the cooperative, whether acquired or to be acquired, and

wherever situated as well as the revenues therefrom, all upon such terms and

conditions as the board of trustees shall determine, to secure any indebtedness of the

cooperative to the United States of America or any agency or instrum entality

thereof. Any such mortgage or mortgages or deed or deeds of trust shall be exempt

from mortgage recordation tax.

(2) A cooperative may not otherwise sell, mortgage, lease or otherwise dispose of or

encumber all or a substantial portion of its prop erty unless such sale, mortgage,

lease or other disposition or encumbrance is authorized by the affirmative vote of

not less than two -thirds (2/3) of all the members of the cooperative; provided

however, that notwithstanding any other provision of KRS 279. 310 to 279.600, or

any other provision of law, the board of trustees may, upon the authorization of a

majority of those members of the cooperative present at a meeting of the members

thereof, the notice of which shall have set forth the proposed action, se ll, lease or

otherwise dispose of all or a substantial portion of its property to another

cooperative or a foreign corporation doing business in this state pursuant to KRS

279.310 to 279.600 or to the holder or holders of any notes, bonds or other

evidences of indebtedness issued to the United States of America or any agency or

instrumentality thereof.