A cooperative association is defined as: “an association of individual business, farmers, ranchers, or manufacturers with similar interests, intending to cooperate in marketing, shipping and related activities (sometimes under a single brand name) to sell their products efficiently, and then share the profits based on the production, capital or effort of each.” “Sunkist” oranges is an example of a large cooperative. Cooperatives include dairy milk producers, cotton gins, and thousands of other enterprises of all sizes. There are also cooperatives in which consumers form retail outlets like grocery stores and share the profits based on the amount of patronage of each member, but they have found it difficult to compete with the giant supermarket chains.
An association is typically established for the purpose of providing services on a nonprofit basis to its shareholders or members who own and control it.
The nature and functions of cooperatives differ considerably—such as purchasing cooperatives, consumer cooperatives, and marketing cooperatives.
In the context of agriculture, a farmers’ cooperative refers to an organization of farmers residing in the same locale that is established for their mutual benefit in regard to the cultivation and harvest of their products, the purchase of farm equipment and supplies at the lowest possible cost, and the sale of their products at the maximum possible price.
The loan file should include a Certificate of Formation. This may be obtained from the Texas Secretary of State.
The loan file should include a copy of the Bylaws certified by the association’s secretary.
The loan file should include a Certificate of Fact: Status.
The loan file should include a copy of the Resolutions of Lodge, Association or Other Similar Organization authorizing it to borrow money, pledge collateral and/or guaranty indebtedness. A sample is included at the end of this Chapter.
A cooperative association conducting business in Texas must file an Assumed Name Certificate. A copy of the Certificate of Fact: Assumed Name should be obtained from the Texas Secretary of State online or by telephoning (512) 463-5578 and from the applicable county clerk(s). A sample Assumed Name Certificate form, with instructions, is located at the end of this Chapter.
NOTE: The provisions of the Texas Assumed Business or Professional Name Act (located in the back of this Guide) require a cooperative association to file its Assumed Name Certificate with the Secretary of State and in the county clerk’s office of each county in which the cooperative association does business.
NOTE: The name of a Texas cooperative is sufficient for purposes of a UCC-1 financing statement only if that name matches the name shown on its Certificate of Formation.