17-5903

Chapter 17.--CORPORATIONS
Article 59.--AGRICULTURAL CORPORATIONS

      17-5903.   Definitions.As used in this act:

      (a)   "Corporation" means a domestic or foreign corporation organized forprofit or nonprofit purposes.

      (b)   "Nonprofit corporation" means a corporation organized not for profitand which qualifies under section 501(c)(3) of the federal internal revenuecode of 1986 as amended.

      (c)   "Limited partnership" has the meaning provided by K.S.A. 56-1a01,and amendments thereto.

      (d)   "Limited agricultural partnership" means a limited partnershipfounded for the purpose of farming and ownership of agricultural land in which:

      (1)   The partners do not exceed 10 in number;

      (2)   the partners are all natural persons, persons acting in a fiduciarycapacity for the benefit of natural persons or nonprofit corporations, orgeneral partnerships other than corporate partnerships formed under thelaws of the state of Kansas; and

      (3)   at least one of the general partners is a person residing on the farm oractively engaged in the labor or management of the farming operation. If onlyone partner is meeting the requirement of this provision and such partner dies,the requirement of this provision does not apply for the period of time thatthe partner's estate is being administered in any district court in Kansas.

      (e)   "Corporate partnership" means a partnership, as defined inK.S.A. 56a-101, and amendments thereto, which has within theassociation one or morecorporations or one or more limited liability companies.

      (f)   "Feedlot" means a lot, yard, corral, or other area in which livestockfed for slaughter are confined. The term includes within its meaningagricultural land in such acreage as is necessary for the operation of thefeedlot.

      (g)   "Agricultural land" means land suitable for use in farming.

      (h)   "Farming" means the cultivation of land for the production ofagricultural crops, the raising of poultry, the production of eggs, theproduction of milk, the production of fruit or other horticultural crops,grazing or the production of livestock. Farming does not include theproduction of timber, forest products, nursery products or sod, and farmingdoes not include a contract to provide spraying, harvesting or other farmservices.

      (i)   "Fiduciary capacity" means an undertaking to act as executor,administrator, guardian, conservator, trustee for a family trust,authorized trust or testamentary trust or receiver or trustee in bankruptcy.

      (j)   "Family farm corporation" means a corporation:

      (1)   Founded for the purpose of farming and the ownership of agriculturalland in which the majority of the voting stock is held by and the majorityof the stockholders are persons related to each other, all of whom havea common ancestor within the third degree of relationship, by blood or byadoption, or the spouses or the stepchildren of any such persons, orpersons acting in a fiduciary capacity for persons so related;

      (2)   all of its stockholders are natural persons or persons acting in afiduciary capacity for the benefit of natural persons; and

      (3)   at least one of the stockholders is a person residing on the farmor actively engaged in the labor or management of the farming operation.A stockholder who is an officer of any corporation referred to in thissubsection and who is one of the related stockholders holding a majority of thevoting stock shall be deemed to be actively engaged in the management of thefarming corporation. If only one stockholder is meeting the requirement of thisprovision and such stockholder dies, the requirement of this provision does notapply for the period of time that the stockholder's estate is beingadministered in any district court in Kansas.

      (k)   "Authorized farm corporation" means a Kansas corporation, other thana family farm corporation, all of the incorporators of which are Kansasresidents, family farm corporations or family farm limited liabilityagricultural companies or any combination thereof, and which is founded forthe purpose of farming and the ownershipof agricultural land in which:

      (1)   The stockholders do not exceed 15 in number; and

      (2)   the stockholders are all natural persons, family farm corporations,family farm limited liability agricultural companies or persons acting in afiduciarycapacity for the benefit of natural persons, family farm corporations, familyfarm limited liability agricultural companies or nonprofit corporations; and

      (3)   if all of the stockholders are natural persons, at least onestockholder must be a person residing on the farm or actively engaged in laboror management of the farming operation. If only one stockholder is meeting therequirement of this provision and such stockholder dies, the requirement ofthis provision does not apply for the period of time that the stockholder'sestate is being administered in any district court in Kansas.

      (l)   "Trust" means a fiduciary relationship with respect to property,subjecting the person by whom the property is held to equitable duties todeal with the property for the benefit of another person, which arises as aresult of a manifestation of an intention to create it. A trust includes alegal entity holding property as trustee, agent, escrow agent,attorney-in-fact and in any similar capacity.

      (m)   "Family trust" means a trust in which:

      (1)   A majority of the equitable interest in the trust is held by and themajority of the beneficiaries are persons related to each other, all ofwhom have a common ancestor within the third degree of relationship, byblood or by adoption, or the spouses or stepchildren of any such persons,or persons acting in a fiduciary capacity for persons so related; and

      (2)   all the beneficiaries are natural persons, are persons acting in afiduciary capacity, other than as trustee for a trust, or are nonprofit corporations.

      (n)   "Authorized trust" means a trust other than a family trust in which:

      (1)   The beneficiaries do not exceed 15 in number;

      (2)   the beneficiaries are all natural persons, are persons acting in afiduciary capacity, other than as trustee for a trust, or are nonprofit corporations; and

      (3)   the gross income thereof is not exempt from taxation under the lawsof either the United States or the state of Kansas.

      For the purposes of this definition, if one of the beneficiaries dies,and more than one person succeeds, by bequest, to the deceasedbeneficiary's interest in the trust, all of such persons, collectively,shall be deemed to be one beneficiary, and a husband and wife, and theirestates, collectively, shall be deemed to be one beneficiary.

      (o)   "Testamentary trust" means a trust created by devising or bequeathingproperty in trust in a will as such terms are used in the Kansas probate code.

      (p)   "Poultry confinement facility" means the structures and relatedequipment used for housing, breeding, laying of eggs or feeding of poultryin a restricted environment. The term includes within its meaning onlysuch agricultural land as is necessary for proper disposal of liquid andsolid wastes and for isolation of the facility to reasonably protect theconfined poultry from exposure to disease. As used in this subsection,"poultry" means chickens, turkeys, ducks, geese or other fowl.

      (q)   "Rabbit confinement facility" means the structures and relatedequipment used for housing, breeding, raising, feeding or processing ofrabbits in a restricted environment. The term includes within its meaningonly such agricultural land as is necessary for proper disposal of liquidand solid wastes and for isolation of the facility to reasonably protectthe confined rabbits from exposure to disease.

      (r)   "Swine marketing pool" means an association whose membership includesthree or more business entities or individuals formed for the sale of hogs tobuyers but shall not include any trust, corporation, limited partnership orcorporate partnership, or limited liability company other than a family farmcorporation, authorized farm corporation, limited liability agriculturalcompany, limited agricultural partnership, family trust, authorized trust ortestamentary trust.

      (s)   "Swine production facility" means theland,structures andrelated equipment owned or leased by a corporation or limited liabilitycompany and used for housing,breeding, farrowing or feeding of swine. Theterm includes within its meaning only such agricultural land as isnecessary for proper disposal of liquid and solid wastes in environmentallysound amounts for crop production and to avoid nitrate buildup and forisolationof the facility to reasonably protect the confined animals from exposure todisease.

      (t)   "Limited liability company" has the meaning provided byK.S.A.17-7663, and amendments thereto.

      (u)   "Limited liability agricultural company" means a limitedliabilitycompany founded for the purpose of farming and ownership of agricultural landin which:

      (1)   The members do not exceed 10 in number; and

      (2)   the members are all natural persons, family farm corporations, familyfarm limited liability agriculture companies, persons acting in a fiduciarycapacity for the benefit of natural persons, family farm corporations, familyfarm limited liability agricultural companies or nonprofit corporations, orgeneral partnerships other than corporate partnerships formed under the laws ofthe state of Kansas;and

      (3)   if all of the members are natural persons, at least one member mustbe a person residing on the farm or actively engaged in labor or management ofthe farming operation. If only one member is meeting the requirement of thisprovision and such member dies, the requirement of this provision does notapply for the period of time that the member's estate is being administered inany district court in Kansas.

      (v)   "Dairy production facility" means the land, structures and relatedequipment used for housing, breeding, raising, feeding or milking dairy cows.The term includes within its meaning only such agricultural land as isnecessary for proper disposal of liquid and solid wastes and for isolation ofthe facility to reasonably protect the confined cows from exposure todisease.

      (w)   "Family farm limited liability agricultural company" means a limitedliability company founded for the purpose of farming and ownership ofagricultural land in which:

      (1)   The majority of the members are persons related to each other, all ofwhom have a common ancestor within the third degree of relationship, by bloodor by adoption, or the spouses or the stepchildren of any such persons, orpersons acting in a fiduciary capacity for persons so related;

      (2)   the members are natural persons or persons acting in a fiduciarycapacity for the benefit of natural persons; and

      (3)   at least one of the members is a person residing on the farm or activelyengaged in the labor or management of the farming operation. If only onemember is meeting the requirement of this provision and such member dies, therequirement of this provision does not apply for the period of time that themember's estate is being administered in any district court in Kansas.

      (x)   "Hydroponics" means the growing of vegetables, flowers, herbs, orplants used for medicinal purposes, in a growing medium other than soil.

      History:   L. 1981, ch. 106, § 1; L. 1983, ch. 88, § 72; L. 1986,ch. 96, § 2; L. 1987, ch. 368, § 1; L. 1988, ch. 99, § 53; L. 1991,ch. 76, § 9;L. 1994, ch. 130, § 3; L. 1994, ch. 331, § 1;L. 1996, ch. 225, § 1;L. 1998, ch. 93, § 71;L. 1999, ch. 119, § 83; Jan. 1, 2000.