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Michigan Cooperative Law Primer for New Cooperative Board Members

Chapter One: First Steps

        In order to know and understand the job that lies ahead, it is vital that you have a working knowledge of the laws that govern the Cooperative. For that reason, you must obtain the current legal documents. Request of your Management Agent or Cooperative Attorney the following:

1. The Articles of Incorporation, which is the legal instrument that was filed with the State in order to create the corpora- tion that launched the Cooperative. It is a foundation docu- ment upon which everything else is based upon. Make sure you receive all amendments to it.

2. The Bylaws, which goes into greater detail on the rights and responsibilities of the Members and the Board. Like the Articles of Incorporation, the Bylaws may have been amended over the years, so be sure to get the current set of Bylaws.

3. The Regulatory Agreement or Use Agreement, if your Cooperative is still subject to HUD’s control.

4. The Management Agreement, which spells out what the Management Agent is responsible for, and governs the relationship between the Cooperative and its management team.

5. The Cooperative Rules and Regulations, together with any Cooperative Policies, which defines a code of conduct for the Members.

6. The OccupancyAgreement that is currently in effect. Together with the Rules, Regulations and Policies, spell out in detail what the Cooperative requires of its membership and becomes important when there are complaints or controversies within the Cooperative community with Members.

7. Contracts, including any agreements with lenders, which may limit the Cooperative or impose certain duties upon it.

        Other documents you should request include the most recent financial audit and the current budget, crucial tools to guide you on making fiscal decisions. Prior Board meeting minutes for the last year ought to be furnished to help you get up to speed on pending issues that the Board has dealt with, or is facing.

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