Share Issue Information

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Information relating to the purchase of shares in Buth Scalpaigh Ltd.

1. This proposal is made by Buth Scalpaigh Limited, an Industrial and Provident Society registered under the Industrial and Provident Societies Act 1965 (register number  2731 RS dated 12 November 2010).
2. Minimum shareholding for membership of Buth Scalpaigh is 1 X £25 share.
3. The purchase of shares will entitle a person to be a full member of the co-operative. Each member has one vote regardless of the size or value of their shareholding.
4. An individual member is allowed to purchase multiple shares up to the legal maximum of £20,000 in shares (800 X £25 share)
5. The purchase of multiple shares can only be bought in increments of £25 Hence members can own £25, £50, £75,….up to £20,000 of shares.
6. Shares are ordinary withdrawable shares and are not transferable. Shares will only be redeemed at face value by the co-operative in accordance with its Rules. Thirteen weeks notice shall be required of any withdrawal. In the event that more than 10% of the total share capital of the co-operative shall be under notice of withdrawal in any one calendar year the right to withdrawal may be suspended by the Committee.
7. The Committee has the right to write down the value of the shares if the liabilities of the co-operative exceed its assets. Members applying to withdraw their shares in this period would receive only the written down value of their shares.
8. In the event of the co-operative ceasing to trade members will be paid up to a maximum of £25 for each share owned once all the creditors have been paid in full. In the event that the co-operative cannot pay its creditors in full members may lose some or all the value of their shares.
9. The co-operative aims to lease premises of the Scalpay Minimarket and operate them as a community shop and café serving the local community. It is the aim of the co-operative to offer the full range of services expected of a modern grocery. There is currently no such business serving the community and the business plan sets out evidence for the following :
   1. A comprehensive community survey recently carried out in Scalpay has identified a strong requirement and overwhelming support for a Community Shop on the Island.
   2. The population of Scalpay (estimated at 300) plus that of the neighbouring communities of Kyles and Carragrich (population 75) is deemed to be sufficient to sustain a business of this nature.
   3. The service provided by the community shop will be of significant social benefit to the local community as well as inevitably providing them with cost savings in the form of reduced mileage costs and cheaper produce.
   4. The business case put forward has deemed that the business is profitable and can also be further supplemented by future projects and additional services.
   5. The capital requirement for the new business is affordable. Excluding the share option scheme, all necessary funding for this project has already been secured.
   6. The advice and guidance provided by existing community shops in the Western Isles indicates that there is a business case for the long-term sustainability of this project.
   7. The business will be able to honour requests for withdrawing share capital within the stated terms.
10. The Committee of the co-operative has prepared a business plan based on an analysis of the population of the area and experience of such businesses serving communities of similar sizes. The development of the business plan has been supported by independent professional advice from CIB Services, HIE and Business Gateway. If you wish to see a more detailed business plan, please contact Coinneach Morrison, Harris Development Ltd.
11. The main risk factors identified by the Committee are:
    1. That insufficient share capital is raised to set up the business.
    2. That suitably experienced staff are not identified.
    3. That in the period during which Scalpay has been without the business, residents’ habits have become fixed and trade will not return.
    4. That there will be insufficient support for the business from communities within and adjacent to the Isle of Scalpay.
12. The primary purpose of the co-operative is to secure the future of this service for the community, not to make returns on capital invested. It is not intended for the cooperative to pay back any dividend to share-holders and it is only in exceptional circumstances that any dividend will be returned to shareholders. In the unlikely event of a shareholder receiving a dividend payment, it is their responsibility to declare any such earnings to HMRC if applicable.
13. Upon completion of this share option scheme, Buth Scalpaigh’s interim committee shall be dissolved and a new committee will be formed at a formal meeting of cooperative members.
14. This proposal is not regulated by the Financial Services and Markets Act 2000 because the shares in the co-operative are not ‘securities’ for the purpose of those regulations. It is therefore not authorised by the Financial Services Authority. If the business fails you have no right of complaint to the Financial Ombudsman or the Financial Services Compensation Scheme.
15. If you are in any doubt about your investment you should consult an Independent Financial Advisor authorised under the Financial Services and Markets Act 2000.
16. Due care has been taken in preparing this offer document, a process which has been overseen by the directors, who can vouch that the information it contains is in accordance with the facts and that there are no omissions likely to affect its import.

Buth Scalpaigh Interim Committee

Peter Dickson             (Chair)             Woodstock,     Bayhead

Morag Macleod           (Secretary)      Cala Reidh,     Bayhead

Lorna Wheeler            (Treasurer)      Cnoc Mor,       Laggandoin

Murdo MacSween                              40 Braevig

Karen Allen                                         Dirascal Cottage