Investor Shares
Investor Shares are shares owned by a member who invests unremunerated labour or equity capital entitling him or her to participate in governance and receive a share of assets and profits.
From V3.0, the FairShares Rules processor allows the renaming of Investor Shares to 'Supporter Shares', 'Ordinary Shares' or 'Community Shares' (depending on legal form). Their characteristics, however, are identical.
Clause 10 defines them in the following way.
10. Investor Shares: issued to any natural or legal person; issued at a fair price to investors of equity capital upon payment; issued to providers of unremunerated labour in proportion to their labour contribution; issued to customers / service users in proportion to the value of their trading activity; one vote per shareholder at General Meetings (except as defined in Clauses 23 and 24); redeemable after 5 years or termination of membership or retirement or death or insolvency by transfer (with compensation at the current ‘fair price’) to one of the following:
a) An Employee Benefit Trust or Co-operative Society established for the purpose of buying and selling (redeeming) Labour shareholders’ investor shares and managing the income from them for the benefit of employees;
b) A Charitable Trust or Charitable Company established for the purpose of buying and selling (redeeming) members’ investor shares, and managing the income from them to support charitable projects;
c) A Community Interest Company or Community Benefit Society created or selected to purchase (redeem) members’ investor shares and manage the income from them to make social investments in a community.
Whilst there are no restrictions on who Investor Shares may be issued to, all sets of model rules encourage the selling and distribution of Investor Shares to User and Labour Shareholders. Clauses 15(a) and (b) define the conditions of internal share offers to existing members.
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