Subd. 1. Capital reserve.

A cooperative may set aside a portion of net income as the board determines advisable to create or maintain a capital reserve.

Subd. 2. Additional reserves.

In addition to a capital reserve, the board may:

1. (1) set aside an amount not to exceed five percent of the annual net income of the cooperative for promoting and encouraging cooperative organization; and
2. (2) establish and accumulate reserves for new buildings, machinery and equipment, depreciation, losses, and other proper purposes.