LBGC share purchases are not tax deductible.
Long Beach Grocery Cooperative, Inc.
235 E. Broadway St Long Beach CA 90802
**Ownership Disclosure Statement:
The following is intended to provide owners and prospective owners of Long Beach Grocery Cooperative, Inc.
(the "Cooperative") with information regarding the Cooperative and the rights and obligations of owners with respect to the
Cooperative. This information is required under the laws of the State of California to be separately disclosed to you.
Long Beach Grocery Cooperative is a cooperative corporation organized under the Consumer Cooperative Corporation
Law of the State of California (which is found in sections 12200 et seq. of the California Corporations Code).
Ownership status in the Cooperative is available to any individual or organization whose intent is to make purchases from the
Cooperative for his, her or its own use and who is willing to accept the responsibilities of ownership. Ownership status confers the
right to purchase groceries and other consumer goods at prices generally available to owners, and to participate in the governance
of the Cooperative in accordance with its Bylaws. Ownership status may be voluntarily terminated at any time upon notice to the Cooperative. An owner may be
expelled by the Board for cause after being provided fair notice of the charges and an opportunity to respond in person or in
writing no less than fifteen days before the effective date of the expulsion.
The most significant responsibility of ownership is to provide necessary capital funds by purchasing or agreeing to purchase
one share. The issuing price of a share is $250. The minimum share purchase requirement is subject to increase by the
Cooperative's Board of Directors, but not to exceed an issuing price of $300 unless a larger amount is permitted by amendments
to the Corporate Securities Law of 1968. And any increases must be for the reasonable capital needs of the Cooperative and must
apply equally to then-existing and newly-admitted owners. No other dues, assessments, or membership fees are authorized to be
imposed with respect to obtaining or retaining ownership status in the Cooperative.
Owners are not required to contribute services to the Cooperative.
Voting rights of owners are strictly equal on the basis of one vote per owner. Owners who have not fully paid their share
purchase requirement but are in good standing are entitled to vote on an equal basis with those whose share purchase is fully
paid. Voting rights are unequal among owners only in the case of an owner being placed in inactive status which will result in
voting rights being suspended until the owner takes action to reacquire good standing. This is explained in the second paragraph
of the “Ownership status” section above. Voting rights may be exercised only by the owner or, in the case of an organizational
owner, by its authorized representative as then shown in the records of the Cooperative.
Proprietary interests of owners include only the accumulated amount paid in for a share (“share capital”) and the accumulated
amount of patronage dividends allocated to the owner but deferred for payment at a future time (“deferred patronage dividends”).
Both of these amounts will vary greatly among owners at any particular time. Proprietary interests are entitled to no dividend or
other monetary return on contributed capital. Proprietary interests are risk capital. As such they are subject to a risk of loss from
unprofitable operations of the Cooperative. Such risk may result in the loss of part or all of the proprietary interests.
Share capital may be redeemed upon request of the owner or the owner's legal representative only after termination of
ownership status. It will be paid by the Cooperative only as replacement capital is received by the Cooperative from other owners
and only in an amount that is the lesser of its carrying value on the books of the Cooperative or its net book value. The net book
value limitation is likely to occur only when and if the Cooperative were to be in serious financial difficulty. Such redemption
proceeds are authorized to be reduced by a processing fee as determined by the Board of Directors, but no processing fee is
currently imposed. Redemption proceeds are also subject to offset by amounts due and payable to the Cooperative by the owner.
No redemption shall be made when such payment would impair the ability of the Cooperative to meet its other obligations as they
become due. Reapplications for ownership after full or partial redemption shall be subject to full repayment of redemption
proceeds. Share capital may not be redeemed at the option of the Cooperative.
Deferred patronage dividends are redeemable only when made payable by action of the Cooperative's Board of Directors.
Termination of ownership by any means does not accelerate the time at which deferred patronage dividends are payable. An
owner who resigns should therefore keep the Cooperative informed of any change to the name or address of the owner. This
may, however, be avoided by a transfer of deferred patronage dividends through the Cooperative as described in the following
section. Both share capital and deferred patronage dividends may be offset by amounts due and payable to the Cooperative but unpaid
by the owner. Deferred patronage dividends may additionally be offset by assessments upon the Cooperative for tax audit
adjustments related to its patronage dividend deduction. Share capital and deferred patronage dividends may also be redeemed
upon liquidation of the Cooperative. Deferred patronage dividends will then be redeemed after all liabilities and expenses of
liquidation have been paid or provision has been for payment. If deferred patronage dividends cannot be redeemed in full they
will be paid in the order of the oldest outstanding amounts and on a pro rata basis among all amounts for each fiscal year.
Upon liquidation share capital will be redeemed at it’s carrying value on the books of the Cooperative only after all liabili¬ties and
expenses of liquidation and all deferred patronage dividends have been fully paid. If share capital cannot be redeemed in full they
be paid on a pro rata basis among all outstanding amounts.
Owners may not directly sell, assign, or otherwise transfer their ownership status or any ownership rights and interests,
including share capital and deferred patronage dividends. Any such attempted transfer will be a nullity having no legal effect
and conferring no rights on the intended transferee. Owners may, however, transfer such ownership rights and interests
through the Cooperative, but only under very limited circumstances. Following termination of ownership the Cooperative will
upon request of the owner or the owner's legal representative transfer the carrying value of share capital and deferred
patronage dividends, net of any authorized offsets, to the credit of another person designated by the requesting owner,
provided that the person so designated is or becomes an owner of the Cooperative and the transfer is for a price that does not
exceed the carrying value of such interests. No fees or other charges for transfer are authorized to be imposed.
The foregoing reflects information found principally in the Bylaws of the Cooperative. A copy of the Bylaws is required to
be provided to you on or before admission to ownership in the Cooperative. If you wish to receive a copy of the Cooperative's
articles of incorporation or a replacement copy of its Bylaws, they will be provided to you upon request and without charge.
If you wish to submit such a request in writing, it should be directed to the Cooperative at the address shown on the top of this
statement. If you wish to submit such a request by telephone, please call 562-354-1524 or email us at