User Shares
A User Share is a share owned by a member who is a user of goods and services, entitling her or him to participate in governance and receive a share of the surplus. For the purposes of clarity, any person recognised as a beneficiary or a customer of the organisation will quality for User Shares.
User Shares are defined in Clause 10 (iii) as follows:
- User Shares: issued at par value to natural or legal persons who use company products and services; non-transferable; one vote per shareholder at General Meetings (except as defined in Clauses 23 and 24); 1p fixed preference dividend each; forfeited on holder's death, bankruptcy or insolvency; cancelled upon cessation of a trading relationship; cancelled without payment on winding up.
As with Labour Shares, the default rules suggest that User Shares should only issues to users who have entered into a commitment that lasts for more than 1 year. This prevents having to issue shares for people who make a single, or short series of purchases. It does encourage, however, the issue of shares to customers who renew an annual contract, or who contract to buy a service for a period of time that exceeds 1 year. User shares can be also be issued to long-term customers who have purchased regularly for more than a year to help cement the trading relationship.
The number of User Shares becomes important when surpluses are generated, as it determines both the share of surplus distributed as a cash dividend to User Shareholders, and the number of Investor Shares (Member Shares) that are distributed to represent User Shareholders' ownership of the company's assets.
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