S E CT I ON 1 . 0
6
MEMBERSHIP REQUIREMENTS
C. PATRONAGE DIVIDEND DISBURSEMENT
Application Fee Change of Ownership, Branch,
$5,000
New Investor/Ground Up
All of the net profit generated from business done with members is distributed back to those members in the form of patronage dividends. Patronage dividends are based on the amount of purchases the member makes from the cooperative. Patronage dividends are paid out annually, generally by the first week in April following the close of the fiscal year. Currently, 40% of the dividend is paid in cash and 60% in a non-cash form. This is subject to change at any time with Board approval. The non-cash distribution is made in the form of Class C shares until the member reaches the minimum stock requirement. Once the minimum stock requirement is met, the non-cash portion of the dividend is issued in the form of five-year interest-bearing patronage refund certificates. For a detailed explanation of stock and note requirements, please refer to the Ace Hardware Retailer Information Memorandum. D. DUAL AFFILIATION Ace does not allow a Member’s business at the licensed location to participate in another major hardware wholesaler’s program. For detailed information, please see a copy of the Ace Hardware Membership Agreement and Member Operational Requirements under the membership agreement. E. GENERAL MEMBER STANDARDS All Members under the 2004 or later Ace Hardware Membership Agreement agree to comply with all the provisions of the General Member Standards.
Change of Ownership (No Cash Out of Stock)
$0
Veterans
$0
A. CAPITAL STOCK REQUIREMENT Each store is required to purchase $5,000 of “initial” capital stock upon joining the cooperative.
INITIAL STOCK Class A $1,000
B. TOTAL STOCK REQUIREMENT Each member has a stock requirement, by location, equal to 20% from the Handled, Paint and S.T.O.P. pools, and 4% from the LTL+ and direct pools. Other than the initial stock purchase described above, all stock purchases are made through the patronage distribution. 60% of the patronage dividend is issued in stock, which is subject to change at any time with Board approval, until the minimum stock requirement is met. Class C $4,000 This initial capital investment is comprised of one share of Class A stock (voting stock) with a par value of $1,000 and 40 shares of Class C stock at $100 par (branch stores would receive 50 shares of C). This amount is billed to the retailer’s statement 30 days after the store has been activated.
Details of the General Member Standards can be found in the Membership Application.
Made with FlippingBook - Online Brochure Maker