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Stockwood Community Benefit Society

Stockwood CBS 2015 - Withdrawable shares - OFFER CLOSED

£100 minimum

All investments and commercial activities carry risk. Therefore shareholders should consider carefully whether Stockwood CBS withdrawable shares are a suitable investment for them in light of their own personal circumstances, take appropriate advice and make their own risk assessment.

Supporting the community purpose of Stockwood CBS should be the primary motivation for investment and investment in the Society should be seen as a long-term social and environmental investment.

An investment in Stockwood CBS is an investment in a trading business and is not a loan or deposit. Depending on the personal circumstances of the shareholder and the proportion of assets they are considering investing, it may be inappropriate to invest savings in Stockwood CBS.

In addition to the usual risks associated with investment in any business, the following risks should be carefully considered before investing. Although the Directors will seek to minimise these risks they could result in a negative effect on the operating results and cash flow of the Trust and may affect the ability to pay interest and return the original investment. The risks outlined below are not exhaustive and there may be other risks of which the Directors are not aware.

General investment risks

  • Changes in laws, regulations, government policy or applicable UK tax arrangements (including any changes to bases of taxation, tax relief and rates of tax) may affect the Society and the attractiveness of an investment in the Society. 
  • The Society’s business may be affected adversely by changes in economic, political, administrative or other regulatory forces.

Risks relating to the legal structure of Stockwood CBS

  • If the Society does not achieve the financial performance forecasted at the time of the Offer, shareholders may not get back the amount invested.
  • The target share interest rate may not be achieved if the Society does not achieve the financial performance forecasted at the time of the Offer. However, the intention is to pay the target share interest rate subject to the conditions set out in the Rules.
  • Shares can only be withdrawn in accordance with the Rules and the ability to withdraw shares can be suspended at the sole discretion of the Board (even if a notice of withdrawal has already been submitted to the Society). If the Society lacks sufficient cash to enable Shares to be withdrawn when desired, withdrawal may be delayed, or not possible. Investment in the Shares should be seen as a long term proposition.
  • Successful applicants will become Members of the Society and thereby own the Society. If the Society is unable to meet its debts and other liabilities, Members could lose up to the whole amount held in Shares (but no more than that amount).

Risks associated with the business and the offer

  • If the Minimum Amount is not reached then the Board may return all shareholding monies received. There will be no deduction of issue costs.
  • While the Society has applied for advance assurance of SITR tax relief from HMRC, there can be no guarantee that this status will be granted or maintained. Furthermore the Society can make no guarantee that individual shareholders will be eligible to claim such relief.
  • The financial model may be affected if there is a decrease in demand for the business units due to external factors or changing trends.
  • Rise in rent defaults which might result from economic recession impacting on small businesses.
  • Rise in interest rates which could affect the costs of capital, particularly any loans provided by a bank.

Mitigating risks

These business risks could potentially impact on Stockwood CBS’s ability to repay share capital or pay annual interest due to a fall in turnover and profit levels. 

The directors will seek to protect against these risks by:

  • Ongoing monitoring of local market conditions, wider market trends, changes to economic conditions, government policies and other external factors that might impact on future demand for business units.
  • Ongoing marketing of the business park to a diverse range of rural SME’s.
  • Maintaining a professional property management service which is proactive in building and maintaining tenant relations, so that potential payment issues can be identified early and appropriate action taken.
  • Seeking low margins and fixed interest rates on borrowing where possible.
  • Maximising community investment. The more equity raised, the less Stockwood CBS will have to borrow and hence the greater returns and greater business stability.

Offer Closed

 As of the 30th of September this offer is closed.

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