AGRICULTURE CODE
CHAPTER 55. COOPERATIVE CREDIT ASSOCIATIONS
§ 55.001. POWERS. An association formed under this
chapter may:
(1) borrow money for and lend money to its members;
(2) discount, rediscount, endorse, purchase, or sell
notes, bills, or other evidences of indebtedness of its members
that may be discounted or rediscounted under the rules prescribed
by the Farm Credit Administration; and
(3) exercise the powers authorized by the general
corporation laws of this state unless the law granting the power
conflicts with this chapter.
Acts 1981, 67th Leg., p. 1121, ch. 388, § 1, eff. Sept. 1, 1981.
§ 55.002. INCORPORATORS. (a) Ten or more persons who
fulfill the requirements of Subsection (b) of this section may
organize a private cooperative credit association.
(b) To be eligible to be an incorporator a person must:
(1) be a citizen of this state; and
(2) be engaged in the production, or production and
marketing, of staple agricultural products or in the raising,
breeding, feeding, fattening, or marketing of livestock.
Acts 1981, 67th Leg., p. 1122, ch. 388, § 1, eff. Sept. 1, 1981.
§ 55.003. ARTICLES OF INCORPORATION. In addition to the
requirements prescribed by the general corporation laws of the
state, the articles of incorporation of an association formed under
this chapter must state that the association may not obtain loans
for, make loans to, purchase notes from, or discount notes for a
person who is not a member of the association.
Acts 1981, 67th Leg., p. 1122, ch. 388, § 1, eff. Sept. 1, 1981.
§ 55.004. CAPITAL STOCK. (a) Except as provided by
Subsection (b) of this section, an association may be organized
under this chapter with or without capital stock.
(b) If an association formed under this chapter is organized
to lend money secured by chattel mortgages on livestock, the
association shall be organized with capital stock.
(c) An association formed under this chapter with capital
stock automatically shall increase its stock at the rate of 10
percent of the amount of loans or discounts made by the association
to its members.
Acts 1981, 67th Leg., p. 1122, ch. 388, § 1, eff. Sept. 1, 1981.
§ 55.005. LOANS. (a) Each applicant for a loan or
discount by an association formed under this chapter shall become a
subscriber to the association's capital stock in an amount equal to
10 percent of the amount of the loan or discount for which
application is made.
(b) The applicant shall pay for the stock required to be
purchased by Subsection (a) of this section at or before the time
that the loan is closed or the discount is granted.
Acts 1981, 67th Leg., p. 1122, ch. 388, § 1, eff. Sept. 1, 1981.
§ 55.006. RATIO OF CAPITAL TO LOANS. (a) The total
amount of the outstanding loans or discounts of an association
formed under this chapter may not exceed an amount equal to 10 times
the amount of the association's paid-up unimpaired capital stock.
(b) The articles of incorporation of an association formed
under this chapter must state the requirement of Subsection (a) of
this section.
Acts 1981, 67th Leg., p. 1122, ch. 388, § 1, eff. Sept. 1, 1981.
§ 55.007. REPURCHASE OF STOCK. (a) The board of
directors of an association formed under this chapter may authorize
the purchase of the association's capital stock at the book value
conclusively determined by the board and pay cash for the stock
within one year thereafter if:
(1) the liabilities of the association are less than
50 percent of its assets; and
(2) the directors determined that the stock may be
purchased without impairment of the association's financial
condition.
(b) The board of directors in its discretion may retire pro
rata stock held by a member or group of members whose loans have
been paid in whole or part.
Acts 1981, 67th Leg., p. 1122, ch. 388, § 1, eff. Sept. 1, 1981.
§ 55.008. REPORTS. Before January 11, April 11, July
11, and October 11, each association formed under this chapter with
capital stock shall file with the secretary of state:
(1) an accurate report showing the association's
financial condition and the amount of outstanding paid-up capital
stock on January 1, April 1, July 1, or October 1 preceding the
report; and
(2) a fee of $2.50.
Acts 1981, 67th Leg., p. 1123, ch. 388, § 1, eff. Sept. 1, 1981.
§ 55.009. FEES. (a) When the articles of
incorporation of an association formed under this chapter are
filed, the incorporators shall pay to the secretary of state a
filing fee of $10.
(b) Each association formed under this chapter without
capital stock shall pay an annual license fee of $10.
Acts 1981, 67th Leg., p. 1123, ch. 388, § 1, eff. Sept. 1, 1981.
§ 55.010. EXEMPTION FROM FRANCHISE TAX. An association
formed under this chapter is exempt from all franchise or other
license taxes, except that:
(1) an association is not exempt from the annual
license fee under Section 55.009 of this code; and
(2) an association is exempt from the franchise tax
imposed by Chapter 171, Tax Code, only if exempted by that chapter.
Acts 1981, 67th Leg., p. 1123, ch. 388, § 1, eff. Sept. 1, 1981.
Amended by Acts 1981, 67th Leg., p. 2786, ch. 752, § 15(c), eff.
Jan. 1, 1982.
