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and as declared by the board of directors.Section 3. The preferred stock of this association may be owned or held by any person,shall carry no voting rights, and may be transferred only on the books of the association; andmay be redeemed in whole or in part on a pro rata basis at par, plus any dividend declaredthereon and unpaid, at any time on thirty (30) days' notice by the association, provided suchstock is redeemed in the same order as originally issued by years. On the failure to deliver thecertificate or certificates evidencing any such stock the association may cancel the same on itsbooks. Stock which has been redeemed may, in the discretion of the board of directors, bereissued or retired. All such preferred stock so redeemed shall be paid for in cash at the parvalue thereof, plus any dividend declared thereon and unpaid; and such stock shall not beardividends after it has been called for redemption.Noncumulative dividends at a rate not to exceed the legal rate of interest in the State ofTennessee or eight (8) percent per annum, whichever is greater, may be paid thereon when, if,and as declared by the board of directors.This association shall have a lien on all of its issued preferred stock for all indebtednessof the holders thereof to the association.At the discretion of the board of directors, all dividends or distributions of the associationor any part thereof may be paid in certificates of preferred stock and/or credits on preferredstock, or ad interim certificates representing fractional parts thereof, subject to conversion intofull shares.Notwithstanding any of the foregoing provisions, the board of directors shall have thepower, from time to time and at any time, to pay off or secure a release or satisfaction of anypreferred stock certificates to compromise or settle a dispute between a holder thereof and theassociation, or to settle an estate of a deceased or bankrupt stockholder.Upon the dissolution or distribution of the assets of the association, the holders of allpreferred stock shall be entitled to receive the par value of their stock, plus any dividend declaredthereon and unpaid, before any distribution is made on the common stock.ARTICLE VIIIMember's LiabilityNo member shall be liable for the debts of the association to an amount exceeding thesum remaining unpaid on his subscription to the capital stock, including any unpaid balance onany promissory notes given in payment thereof.4

BY-LAWSOFTENNESSEE FARMERS COOPERATIVEARTICLE IPurposes and PowersThe purposes for which this association is formed and the powers which it may exerciseare set forth in the articles of incorporation of this association.ARTICLE IIMembers and PatronsSection 1. Qualifications of members. - The membership of this association shallbe restricted to associations of agricultural producers, (a) which are organized under theagricultural cooperative laws of Tennessee or the generally similar laws of another state, (b)which are holders of at least one fully paid share of the common stock of this association, (c)which conform to the definition of a cooperative contained in the Act of Congress known asthe Agricultural Marketing Act, as amended (12 U.S.C. 1141j) and (d) meeting such otherconditions as may be prescribed by the board of directors. If a member ceases to patronizethe association for a period of two years or upon acceptable terms, then the member shallcease to be an eligible member on the board of directors making such a finding. In its solediscretion, the board of directors may prescribe a minimum amount of business required toobtain or retain membership with the association. The board may in its discretion establisha membership fee for new members. No application for membership shall be accepted, exceptby approval of the board of directors.Section 2. Non member patrons. - The association may transact business with nonmembers to the fullest extent allowed by cooperative principles and applicable law.Section 3. Suspension or termination. - If, following a hearing, the board of directorsshall find that a member has not, for a period of two years, patronized the association, or hascommitted conduct detrimental to the interests of the association, or has violated the articles ofincorporation, bylaws or other agreements with the association, the board may then suspendthe member’s rights as a member or terminate his/her/its membership at their option, all asprovided in Section 1 of Article IV of these bylaws. In the event that the board of directors findsthat any member fails to meet such qualifications or requirements, the member shall be notifiedof such fact. A member so notified shall have the opportunity to object to this finding throughan informal hearing (without legal representation or witnesses) before the directors at a regularlyscheduled meeting of the board within sixty (60) days after the member receives notice of themembership termination, and such notice shall be conclusively presumed to have been receivedby the member three (3) business days from mailing if sent by the association to the member’slast known address by first class mail.The member shall deliver a written objection to theassociation within that sixty (60) day period, otherwise the objection is lost and the board’soriginal determination then becomes final. Upon the original determination of membershiptermination or suspension by the board, the member’s membership status shall be suspendeduntil made final or reinstated. Upon a timely objection made and a hearing held, the membershall be given up to thirty (30) minutes to state the member’s objections and concerns duringthe hearing before the board. The board’s determination following the hearing shall beconclusive, binding and final in all respects.Section 4. Members Consent Agreement. - Each association which hereafter appliesfor and is accepted to membership in this cooperative and each member of this cooperative onthe effective date of this bylaw which continues as a member after such date shall, by such actalone, consent that the amount of any distributions with respect to its patronage occurring afterDecember 31, 1963, which are made in written notices of allocation (as defined in 26 U.S.C.5

1388) and which are received by it from the cooperative, will be taken into account by it at theirstated dollar amounts in the manner provided in 26 U.S.C. 1385 (a) in the taxable year in whichsuch written notices of allocation are received by it.Section 5. Contract Patrons. – The association may contract to pay patronagerefunds to persons transacting business with it other than members as may be permitted byapplicable cooperative principles. Patronage refunds shall be paid to contract patrons on thesame basis as refunds paid to members.ARTICLE IIIMeetingsSection 1. Fiscal Year. - The fiscal year of the association shall be determined by theboard of directors, and in the absence of such determination, shall commence on the first day ofAugust and end on the last day of July.Section 2. Annual meeting. - The annual meeting of the members of this associationshall be held in the State of Tennessee at such time and place as the board of directors shalldesignate but no later than one hundred eighty (180) days after the association’s fiscal yearend. The voting delegate of each member of the Tennessee Farmers Cooperative to the annualmembership meeting of the Tennessee Farmers Cooperative shall be selected from the board ofdirectors of the member cooperative.Section 3. Special meetings. - Special meetings of the members of the associationmay be called at any time by order of the board of directors, and shall be called at any timeupon the written request of at least ten (10) per cent of the members; provided, however, thatthey file a petition stating the specific business to be brought before the association and demanda special meeting. This request shall state the time, place and object of the meeting.Section 4. Notice of meetings. - Written or printed notice of every regular and specialmeeting of members shall be prepared and mailed to the last known post office address of eachmember not less than ten (10) days before such meeting. Such notice shall state the object orobjects thereof and the time and place of meeting and, in the discretion of the board of directors,may be given by publishing the same at least ten (10) days prior to the date of the meeting ina newspaper of general circulation published in the town where the principal place of businessof the association is located. No business shall be transacted at special meetings other than thatreferred to in the call.Section 5. Absentee voting. - Voting by proxy shall not be permitted but absentmembers may vote on specific questions other than the removal of directors by ballottransmitted to the secretary by mail, and such ballots shall be counted only in the meetings atthe time in which such vote is taken, provided that all members, pursuant to action by the boardof directors, have been mailed an exact copy of the motion or resolution upon which such voteis taken, and a copy of the same is forwarded with and attached to the vote of the membervoting.Section 6. Quorum. - Thirty (30) percent of the members shall constitute a quorumfor the transaction of business at any meeting of the association except for the transaction ofbusiness concerning which a different quorum is specifically provided by law or by these bylaws;but in the event a quorum is not present, such meeting may be adjourned from time to time bythose present until a quorum is obtained.Section 7. Order of business. - The order of business at the annual meeting shall be:(1) Roll Call(2) Proof of due notice of meeting(3) Reading and disposal of minutes(4) Annual report of officers and committees(5) Unfinished business(6) New business(7) Election of directors(8) Adjournment6

Section 8. Rules of Order. – Robert’s Rules of Order, Simplified and Applied(Second Edition, by Robert McConnell) shall be the recognized and accepted parliamentaryauthority for all meetings.ARTICLE IVStock CertificatesSection 1. Common stock certificate. - Each certificate of common stock shall havethe following statement printed on its face:Subject to limitations contained in the bylaws the stock evidenced hereby may bepurchased, owned and/or held only by persons engaged in the production of agriculturalproducts, including the lessees and tenants of land used for the production of such products andany lessors and landlords who receive as rent all or any part of the crop raised on the leasedpremises; or by other associations organized under the Cooperative Marketing Law ofTennessee, as amended from time to time. No stockholder shall have more than one voteregardless of the number of shares of common stock held by him.If the board of directors of the association shall find, following a hearing, that any of thecommon stock of the association has come into the hands of any person not eligible formembership, or that the holder thereof has ceased to be an eligible member, such holder shallhave no rights or privileges on account of such stock, or vote or voice in the management oraffairs of the association, (other than the right to participate in accordance with law in case ofdissolution), and the association shall have the right, at its option, (a) to purchase such stock atits book value, as conclusively determined by the board of directors of the association, and payfor it in cash within one year, except when the debts of the association exceed fifty (50) percentof the assets; (b) to require the transfer of any such stock at such book value to any personeligible to hold same; or (c) to require such holder of any such stock to convert the same intoshares of preferred stock of equal value.For the purpose of revolving its capital the association may, at any time, except whenthe debts of the association exceed fifty (50) percent of its assets, buy in its common stock, inthe same order as originally issued by years, at book value as conclusively determined by theboard of directors of the association, except that eligible holders thereof shall be entitled tocontinue to hold at least one share of such common stock. The stock thus bought in may bereissued.In exercising its right to purchase or to require the transfer or conversion of commonstock into preferred stock, if such holder fails to deliver the certificate or certificates evidencingthe same, the association may cancel such certificate or certificates on its books and issue a newcertificate or certificates of common or preferred stock, as the case may be.The common stock of the association may be transferred only with the consent of theboard of directors of the association and only on the books of the association, and then only topersons eligible to hold same; and no purported assignment or transfer of common stock shallpass to any person not eligible to hold same, any rights or privileges on account of such stock,or vote or voice in the management or affairs of the association. The association shall have alien on all of its issued common stock for all indebtedness of the holders thereof to theassociation.Noncumulative dividends at a rate not to exceed the legal rate of interest in the State ofTennessee or eight (8) percent per annum, whichever is greater, may be paid thereon when, if,and as declared by the board of directors.Section 2. Preferred stock certificates. - Each certificate of preferred stock of thisassociation shall have the following statement printed on its face:The preferred stock of this association may be owned or held by any person, shall carryno voting rights and may be transferred only on the books of the association; and may beredeemed in whole or in part on a pro rata basis at par value plus any dividends declared thereon7

and unpaid, at any time on thirty (30) days notice by the association, provided said stock isredeemed in the same order as originally issued by years and on the failure to deliver thecertificate or certificates evidencing any such stock the association may cancel the same on itsbooks. Stock which has been redeemed may, in the discretion of the board of directors, bereissued or retired. All such preferred stock so redeemed shall be paid for in cash at the parvalue thereof, plus any dividend declared thereon and unpaid; and such stock shall not beardividends after it has been called for redemption.Noncumulative dividends at a rate not to exceed the legal rate of interest in the State ofTennessee or eight (8) percent per annum, whichever is greater, may be paid thereon when, if,and as declared by the board of directors.This association shall have a lien on all of its issued preferred stock for all indebtednessof the holders thereof to the association.At the discretion of the board of directors, all dividends or distributions of the associationor any part thereof may be paid in certificates of preferred stock and/or credits on preferredstock, or ad interim certificates representing fractional parts thereof, subject to conversion intofull shares.Notwithstanding any of the foregoing provisions, the board of directors shall have thepower, from time to time and at any time, to pay off or retire or secure a release or satisfactionof any preferred stock certificates to compromise or settle a dispute between a holder thereofand the association, to settle an estate of a deceased or bankrupt stockholder.Upon dissolution or distribution of the assets of the association the holders of all preferredstock shall be entitled to receive the par value of their stock, plus any dividend declared thereonand unpaid before any distribution is made on the common stock.ARTICLE VDirectors and OfficersSection 1.01. Districts. For the purpose of electing directors and any other purposesas the board of directors shall determine, the territory served by this association shall bedivided into three districts, referred to herein as “Zones,” from which the associationreceives approximately equal volumes of business from the members therein. The State ofTennessee shall be divided into three Zones, with Zone 1 consisting of all membercooperatives principally located west of a line running from the western boundary of WayneCounty, Tennessee to the western boundary of Stewart County, Tennessee and extendingnorth and south along that line beyond Tennessee’s state line; Zone 2 shall consist of allmember cooperatives principally located east of the aforementioned Zone 1 boundary line toa line extending from the easterly boundary line of Franklin County, Tennessee to theeasterly boundary line of Macon County, Tennessee and extending north and south alongthat line beyond Tennessee’s state line; Zone 3 shall consist of all member cooperativesprincipally located east of Zone 2’s easterly boundary. For the purposes of clarity regardingthe principal location of current member cooperatives that may be on or near zone lines,Benton, Decatur and Hardin Farmers Cooperatives shall be deemed to be Zone 1cooperatives; Wayne, Perry, Humphreys, Macon-Trousdale, Smith, Coffee, Rutherford,Grundy and Franklin Farmers Cooperatives shall be deemed to be Zone 2 cooperatives; andOverton, Putnam, Dekalb, Warren, and Marion Farmers Cooperatives shall be deemed to beZone 3 cooperatives.Section 1.02. Redistricting. Whenever by reason of any substantial increase ordecrease in the volume of business done by the association with its members in anydistrict/zone, or for other good cause, it shall appear to the board of directors advisable toredistrict the territory served by the association, the board of directors shall makerecommendations to the membership to change the boundaries of some or all of the severaldistricts/zones to such extent as the board deems proper, and upon approval of a majorityof the membership in attendance (after a quorum is determined) at a meeting of the8

membership, such redistricting shall become effective at the next annual meeting unless adifferent effective date is approved.Section 2.01. Number and Zone Designations of Directors. - The business, affairsand property of the Association shall be managed by its Board of Directors, which shall consistof nine (9) members.Unless otherwise set forth herein, three Directors shall be elected from each Zone andeach shall serve three (3) year terms. Beginning with the annual meeting of 2006, for thepurpose of electing directors to fill any vacancies on the Board, former TFC Bylaw DirectorDistricts I and II, along with the Public Director position as of the 2006 annual meeting,shall be deemed to be Zone I Directors; former Director Districts III, IV and V shall bedeemed to be Zone II Directors; and former Director Districts VI and VII shall be deemed tobe Zone III Directors, with a new directorship position added as a Zone III director.Beginning at the annual meeting in 2006, the former directorship position for District V willbe elected by Zone II to a term of four (4) years and Zone III shall elect a new director fora term of five (5) years, bringing the total number of Board members from eight (8) to nine(9). At the annual meeting in 2007, the former directorship position for District I shall beelected by Zone I for a four (4) year term and the former Public Director position shall beelected by Zone I for a five (5) year term. At the annual meetings for 2008, 2009 and2010, the expiring director’s positions shall be elected by their respective Zones for three(3) year terms. At the annual meeting in 2011, the former directorship position for DistrictII shall be elected by Zone I to a five (5) year term. For the annual meeting of 2012 andthereafter, all directorship positions shall be elected to three (3) year terms.Section 2.02. Term Length. No director shall serve continuously in any onedirectorship position for more than nine (9) years, however, any director having sat out oneyear shall again be eligible for ele

pursuant to the Cooperative Marketing Law of Tennessee (Laws, 1923, Chapter 100; Code of Tennessee, 1932, Section 3784, et seq.), and amendments thereto, to be operated for the mutual benefit of its members. ARTICLE I . Name. The name of the association shall be the Tennessee Farmers Cooperative. ARTICLE II . Purposes