Share Offer FAQs
COMMUNITY SHARE OFFER - FREQUENTLY ASKED QUESTIONS
The documents below set out the details of the share offer:
Share Offer Prospectus
Business Plan
Community Benefit Society Rules
WHY SHOULD I BUY COMMUNITY SHARES?
The Anchor has always been at the heart of the community and by being a member shareholder you can help us shape the future of the pub/hub to ensure it always works for the benefit of locals, visitors and all who visit and love Port Bannatyne. Your financial investment will help raise vital funds needed to get the The Anchor back open in Community Ownership. The Scottish Land Fund grant is conditional on us running a successful community share offer.
WHO WILL BENEFIT FROM THIS PROJECT?
The residents of Port Bannatyne will benefit directly from having a vital amenity preserved for future generations, both through the use of the facility itself but also because the Anchor will play a part in making Port Bannatyne a stronger, more vibrant and cohesive community in which to live.
HOW MUCH CAN I INVEST?
If you normally live in Port Bannatyne (known as a Type A member):
The minimum is £25
This area includes everyone whose postal address is Port Bannatyne, plus people in the rural area towards Rhubodach and Kilmichael who vote at Port Bannatyne Village Hall.
If you normally live on the Isle of Bute outwith Port Bannatyne: (known as Type B member)
Applications will be prioritised for those who apply for a minimum of £200.
If you normally live elsewhere but have a home on Bute (working away, second home etc) (also known as Type B):
Applications will be prioritised for those who apply for a minimum of £200 of shares.
If you normally live elsewhere and don’t have an address on the Isle of Bute, or you are a Corporate investor (also known as Type B):
Applications will be prioritised for those applying for a minimum of £1,000 of shares.
The maximum any member may purchase is £10,000 and no individual shareholding may exceed 10% of the total amount raised regardless of membership type.
We hope to be able to accept all eligible share applicants, however we must ensure the majority of our members are Port Bannatyne residents. This means there will be a limited number of places for people living outwith Port Bannatyne, however we are confident that we will be able to accept Type B applications for the above amounts of shares.
WHAT WILL HAPPEN WITH MY PERSONAL INFORMATION?
All members will be added to the Society’s member register, which will include their name and contact details. This is required in Society law to allow for member communication. The value of your shares will not be made public.
CAN I BUY SHARES AS A COMPANY/CHARITY?
Companies, charities and other societies may purchase shares as Type B members and a named individual will be able to vote at members’ meetings on their behalf.
WHY ARE THERE TWO CLASSES OF MEMBERSHIP?
It is a requirement of the Scottish Land Fund that the Society has a majority of its members reside in the local area. The intention of this rule is to ensure that local people are empowered through community ownership.
WHAT HAPPENS IF THE SHARE OFFER DOESN’T REACH ITS TARGET?
Our business plan has identified £50,000 as the minimum sum of money required through this share offer to complete the purchase of The Anchor and provide working capital, to get us started as a community business This allows for some repairs and refurbishment, but not to the standard we could achieve with the full £105,000. If we are unable to reach £50,000, we would not be able to proceed with buying the pub. In the event we are close to the target, the Management Committee has the discretion to extend the offer period. If we are still not successful in raising the required funds, the Management Committee will review whether to proceed. We reserve the right to do so if the financial model remains viable, for example, if we have received additional donations or confirmation of grant funding. In the event of a decision being made not to proceed with the purchase your investment will be returned in full.
WHAT HAPPENS IF THE SHARE OFFER TARGET IS REACHED?
If the share offer target of £105,000 is reached we will close the share offer, and we will not accept any further applications.
WHAT HAPPENS IF THE PURCHASE OF THE ANCHOR FALLS THROUGH?
We have maintained consistent contact with the current owner and their representatives up to this point, and conversations have been constructive and positive. Our solicitors are ready to move towards the conclusion of missives as soon as we advise them that the £50,000 minimum has been passed.
WHAT HAPPENS TO THE PROFITS MADE BY THE SOCIETY?
All profits will either be reinvested into the business or will be used to support local causes. None of the Management Committee stand to personally gain from their involvement, other than through the interest payable to all members.
WHAT HAPPENS IF THE SOCIETY IS WOUND UP OR DISSOLVED?
All of the assets would be sold and the proceeds of the sale (after settling any debts) would be divided between the shareholders up to the value of their shares. Any excess value would be transferred to another community organisation having similar community benefit aims. This is known as an asset lock and is to prevent private gain if the organisation dissolves. If the asset value was lower than the share capital, shareholders would receive back less than their original investment.
IS THIS A GOOD INVESTMENT?
We expect and will require the Anchor to be profitable. We have carefully evaluated its strengths and weaknesses and our projections show that we can establish it as a successful business. It is well proven that communities that work together to set up such an enterprise will support it in the future. We are not aware of any community-owned pubs which have failed. However, you could stand to lose some or all of your investment and if you have any doubts over whether or how much to invest, you should consult an independent financial advisor.
For more details about our business case please read the business plan and share offer prospectus.
This share offer is not subject to the Financial Services Markets Act 2000 or covered by the Financial Services Compensation Scheme and investors will have no recourse to the Financial Ombudsman. You could lose some or all the money you invest.
WHAT IS SOCIAL INVESTMENT TAX RELIEF (SITR)?
This is a government-backed scheme designed to encourage investment in social enterprises. Port Bannatyne Development Trust Ltd is going through the process of applying for advance assurance for SITR and we hope that this assurance will be received before the close of the share offer.
For information about SITR go to www.getsitr.org.uk
CHRISTMAS IS COMING, CAN I APPLY FOR SHARES AS A GIFT FOR SOMEONE ELSE?
Yes you can buy shares as a gift. There are two key points:
1. The gift you can give (Member type A or B) will be determined by the residence of the recipient. Some examples are below:
- An off-island individual can give a Type A membership to a Port Bannatyne resident. The minimum value is £25.
- A Rothesay resident can give a Type A membership to a Port Bannatyne resident. The minimum share value is £25.
2. We will need permission from the person you are gifting to (this is a Community Shares Standard Mark rule). The PBDT CBS will do this on behalf of the person submitting the application.
COULD I BE LIABLE FOR ANY DEBTS IF THE BUSINESS FAILS?
You could stand to lose some or all of your investment, but members will not be liable for any costs beyond the value of their shares.
WHY FORM A COMMUNITY PUB, WHAT ARE THE ADVANTAGES OVER THE ANCHOR TAVERN BEING PRIVATELY RUN?
As a community pub The Anchor will be run by the community, for the community. Profits will be reinvested back into the business and other local projects that provide a wider community benefit. We can tailor the business model to ensure that it reflects the goals and aspirations of the community. We can protect this vital community asset into the future, ensuring it always works with the communities best interests at heart, and delivers tangible and long-lasting benefits. There is no certainty that the Anchor would remain a pub if not bought by the community.
WHO WILL MAKE DAY TO DAY DECISIONS ABOUT THE RUNNING OF THE PUB?
The Anchor will operate under a staff-based model, with a single member of staff responsible for operations on each shift. A subcommittee of the Management Committee will directly manage all staff, each member having designated responsibility for areas in which they have experience or will receive training. The sub-committee will be appointed, based upon experience and availability, prior to commencing staff recruitment.
The Scottish Land Fund has provided funding for a Business Development Officer who will be employed to get reliable systems in place for running the pub, and develop trade during the first
year of business. The business development officer will work with and report to the sub-committee who will set the goals and financial projections for the business.
HOW WAS THE PROPERTY VALUED?
As part of our Scottish Land Fund application we were required to conduct an independent valuation of the property, from which our financial calculations would be drawn up. This valuation was carried out by MJD Hughes who were granted access to the property to carry out a valuation and condition survey.
WHEN CAN I WITHDRAW MY SHARES?
Share withdrawals will not be allowed within the first three years, in order for the Society to build its reserves and to meet the requirements for social investment tax relief. Once this period has passed we will consider withdrawals on a first come first served basis. Withdrawals will be entirely at the discretion of the Management Committee and only allowed where there are sufficient funds available.
WHAT HAPPENS TO MY SHARES IF I DIE?
Your shares will form part of your inheritance and can be transferred as part of your will. You may nominate on your share application form a person you wish to receive your shares in the event of your death. Nominees must be aged 16 or over. You may also elect to donate your shares to the Society.
Shares cannot be sold or transferred except upon your death. If you already know who you want this to be to when the time comes (and it can be more than one person) you can tell us in advance and then if and when we get confirmation of your death, we can make the transfer directly without reference to your executors and the wider probate process.
This only applies to any investment of £5,000 or less and investments greater than this sum must be transferred in accordance with the probate process and what is stated in your will.
If you have invested less than £5,000 but have made no nomination to us, the society will still transfer the shares outside the probate process, but we will contact your executors for guidance.
WHAT RIGHTS DO I HAVE AS A MEMBER?
Community Benefit Societies are owned and controlled by their members on a principle of ‘one member one vote’. Everyone has an equal voice, regardless of the size of their investment
That means regardless of how much you invest, you’ll have an equal say to other members. You’ll be able to stand for and vote in the election of the Management Committee, who will make decisions about the running of the Society. You’ll also be able to vote on any resolutions at members meetings.
WHO ARE THE PEOPLE BEHIND THIS PROJECT? DO THEY HAVE A PERSONAL INTEREST?
The initial Management Committee consists of a group of local residents and second home owners who care passionately about preserving a pub/hub in Port Bannatyne and what it could mean for the community. They will have no personal financial interest in the project, above and beyond their own investment in community shares. They have voluntarily contributed a large amount of time to the project and this has been supplemented with advice and considerable support from many people and organisations.
WILL I RECEIVE INTEREST FROM MY SHARES?
We intend to pay 2% annually (not compounded) after Year 3 following the share offer. All interest payments will be at the discretion of the Management Committee and dependent on financial performance.
CAN MY SHARES GO UP IN VALUE?
No, community shares cannot increase in value. However, their value may decrease if the value of the assets falls.
CAN I SELL MY SHARES TO SOMEBODY ELSE?
No, community shares are non-transferable. Shares can only be withdrawn after 3 years at the discretion of the Management Committee.
Have more questions? Get in touch with us at admin@pbdt.org or telephone 01700 505617.
