17-1616.   Marketing contracts; injunction to prevent breach.(a) The association and the association's members may make and executemarketing contracts, requiring the members to sell, for any period of time, notover 10 years, all or any specified part of their agricultural products orspecified commodities exclusively to or through the association or anyfacilities to be created by the association. The contract may provide that theassociation may sell or resell products of the association's members with orwithout taking title thereto; and pay over to the association's members theresale price, after deducting all necessary selling, overhead, and other costsand expenses, and other proper reserves, including interest on common orpreferred stock not exceeding the greater of 8% per annum or the contractinterest rate set forth in subsection (a) of K.S.A. 16-207, and amendmentsthereto, at the time of issuance thereof and reserves for retiring the stock,if any. These limitations shall not apply to dividends paid by subsidiariescreated hereunder to parent cooperative corporations operating under this act.

      (b)   The bylaws and the marketing contract may fix, as liquidated damages,specific sums to be paid by the member or stockholder to the association uponthe breach by such member or stockholder of any provision of the marketingcontract regarding the sale or delivery or withholding of products; and mayfurther provide that the member will pay all costs, premiums for bonds,expenses and fees in case any action is brought upon the contract by theassociation; and any such provision shall be valid and enforceable in thecourts of this state. In the event of the such breach or threatened breach ofsuch marketing contract by a member, the association shall be entitled to aninjunction to prevent the further breach of the contract, and to a decree ofspecific performance thereof. Pending the adjudication of such an action andupon filing a verified complaint showing the breach or threatened breach, andupon filing a sufficient bond, the association shall be entitled to a temporaryrestraining order and preliminary injunction against the member.

      History:   L. 1921, ch. 148, § 16; R.S. 1923, 17-1616; L. 1931, ch.150, § 7; L. 1992, ch. 227, § 16; July 1.