Cooperative stock/cooperative equity.

CFR · 2024-01-01 · US · Title 7

(a) (1) The maximum loan amount is the threshold established in § 4279.161(c), and all applications will be processed in accordance with § 4279.161(c). (2) The maximum term is 7 years. (3) The lender will, at a minimum, obtain a valid lien on the stock, an assignment of any patronage refund, and the ability to transfer the stock to another party, or otherwise liquidate and dispose of the collateral in the event of a borrower default. (4) The lender must complete a written credit analysis of each stock purchase loan and a complete credit analysis of the cooperative prior to making its first stock purchase loan. (5) The borrower may provide financial information in the manner that is generally required by commercial agricultural lenders. (6) A feasibility study of the cooperative is required for startup cooperatives and may be required by the Agency for existing cooperatives when the cooperative's operations will be significantly affected by the proceeds that were generated from the stock sale. (7) The Agency will conduct an appropriate environmental assessment on the processing facility and will not process individual applications for the purchase of stock until the environmental assessment on the cooperative processing facility is completed. Typically, an individual loan for the purchase of cooperative stock is considered a categorical exclusion. (b) (1) “Similar equity” is any special class of equity stock that is available for purchase by non-members and/or members and lack

official document · source cfr-2024 · id 7:§ 4279.115