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An opportunity to support our locally grown food cooperative!
...fund construction of a certified green building on North King Street in Northampton and open for business
...provide member-owners and other shoppers with an abundance of fresh, local and organically grown foods
...support local growers and food producers and the local economy, while creating jobs in a thriving local business
...offer the lowest possible prices to serve all economic and cultural segments of the community
...provide education about cooperatives, food, health, green building and related topics
...make a contribution to the community by providing a welcoming community-based environment in which to shop - one that strives to complement rather than compete with other area businesses.
Like most new businesses, River Valley Market needs more owner investments during the early years of its operations to help support its development and working capital needs. Food cooperatives routinely use member loan programs to provide this additional member-owner capital which then helps fund costs such as starting a co-op, opening a new store, developing programs, and strengthening store operations.
Member loans (along with member equity and our bank loans) are an important component of our overall financing and an opportunity for member-owners to further support River Valley Market.
Over 200 member-owners participated in our previous Member Loan Program, contributing loans totaling over $1 million. These member loans enabled us to meet the required owners' investment to qualify for our mortgage loan approval.
Our goal is to raise $250,000 during our 2007-2008 Member Loan Campaign.
The funds will be used to:
1. repay a $100,000 short-term bridge loan we received from the Western Massachusetts Enterprise Fund (WMEF)
2. enhance the Co-op's cash flow during the start-up phase
3. support the Co-op's overall initial start-up expenses
1. The Member Loan Program is open to all River Valley Market member-owners.
2. The minimum loan we can accept is $1,000. (We expect loans to range from the minimum of $1,000 up to $50,000 with the average being $5,000.)
3. Member-owners giving loans will choose their interest rate:
0 - 4% for loans below $10,000
0 - 5% for loans $10,000 and above
(These interest rates reflect a basic premise of member loans as investments in the quality of life of the community, not as financial growth investments. This is an important distinction as you consider loaning money to the cooperative.)
4. Member Loans will be held for a 10-year term.
5. Simple interest will be paid once a year beginning within 12 months of the store opening.
6. Member loans are unsecured and subordinate to our bank loans.
Yes, there are risks. We would like member-owners considering making a loan to understand that they are putting their funds at risk to support a new community-owned, cooperative business.
The Co-op has no operating or financial performance history and the grocery business is a very competitive one. Member loans are also unsecured and are subordinate to our bank loans.
As in all lending decisions, member-lenders should not exceed their capacity to absorb potential losses inherent in any business endeavor. (See additional information in the 2007-2008 Member Loan Program Information booklet).
We hope you will consider making a loan to help make sure River Valley Market is as strong as possible during this start-up phase of our business.
This is your opportunity to help Northampton and the surrounding communities by supporting a grocery cooperative that will support local farmers, enhance economic sustainability in our region, and contribute to community-building among our customers.
Thank you for considering this socially conscious investment opportunity!
Member Loan Committee Chair Sharon Rudnitzky welcomes questions from member-owners interested in participating with a Member Loan.
You can reach Sharon at (413) 268-3448 or e-mail sharon@rivervalleymarket.coop
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