Bar News - December 17, 2010
The Hostile Takeover of the Merrimack Farmers’ Exchange
By: Lorraine Merrill
A new book recounts the little-known story of embezzlement that led to the demise of the Merrimack Farmers’ Exchange, a venerable farm supply cooperative that was acquired by H.K. Webster Co. (Blue Seal Feeds) in 1980. The Exchange built the feed mill now owned and operated by Blue Seal Feeds in Bow. My memories of Merrimack Farmers’ Exchange begin with countless childhood trips with my father or mother or uncle to pick up grain or any number of supplies from the store on the railroad tracks in Exeter. I loved the smell of the grain store, and its worn wooden floors and shelves.
Merrimack Farmers’ Exchange was an early experiment in cooperative business, founded by a group of 50 Merrimack County farmers in 1918. The book’s author, Charles Sheridan, explains that because New Hampshire did not yet have a legal framework for forming and governing a cooperative, the founders incorporated their organization. But they remained dedicated to their cooperative purpose and philosophy – operating the business to keep farmer supply costs down, and following a policy of one member/one vote, regardless of the number of shares held.
Sheridan is a partner at the Sulloway & Hollis law firm in Concord, and was counsel to the Merrimack Farmers’ Exchange through this turbulent period. He gives the inside scoop on the embezzlement by the cooperative’s chief accountant, totaling over a half-million dollars. The take-away lesson to boards of directors: don’t try to save money by reducing the size of the external audit of the books. Sheridan and the board focused on successfully recouping the stolen funds rather than prosecuting the embezzler, so the story was not publicized at the time.
Sheridan, a business and securities lawyer, developed a deep respect for the farmer members of the cooperative’s board, and for the organization that had been built by farmers to serve farmers. "It was a community-enhancing organization," he told me when I met with him to discuss his book. "Farm families are models of good citizens. When I think of the good things about America, the farmers come to mind – honesty, dedication, hard work, raising children the right way, helping your neighbors."
Sheridan believes the story of the undoing of the Merrimack Farmers’ Exchange encapsulates an important part of New Hampshire history and the period. He retains all the board’s records, which he used in writing the book. The book first caught my eye at the book shop in the Museum of New Hampshire history. The cover design features the November 1979 edition of the New Hampshire Times – with front page entirely devoted to "The Attempt to Take Over Merrimack Farmers’ Exchange," reported by Steve Taylor.
The book, titled A Window in Time: Merrimack Farmers’ Exchange in Crisis and Transition, can also be found at Gibson’s Bookstore in Concord, or by mail by sending a check for $10.95 (includes shipping) to Charles F. Sheridan, 9 Capitol Street, Concord, NH 03301.
Lorraine Merrill is commissioner of the NH Department of Agriculture, Markets and Food. This review was first published in the Weekly Market Bulletin on September 22, 2010.