Based on the success of the CVC Patron Note program since 2009, the board of directors has voted to double the amount of the investment opportunity for patrons of Central Valley Cooperative! If your existing investment options are not what you believe they should be, please read more below.
The program is available to all Central Valley Cooperative voting members who are residents of Minnesota. Voting membership requires that a patron has conducted a minimum of $3,000 of business with the cooperative during the prior fiscal year and is currently in good standing with all your accounts.
The financial strength and stability of Central Valley Cooperative remains extremely strong and we are continually looking for ways to position ourselves well into the future. We believe that the Patron Note program truly provides a win-win opportunity for the voting members and CVC alike. By working together, we will continue to ensure that we are in a position to take advantage of opportunities in the marketplace together with lessening the reliance on external funding sources to meet the working capital needs of the Cooperative.
There are two separate types of programs offered, both of which will be issued as an Unsecured Certificate of Indebtedness:
Demand Note
The Demand Note program works much like a standard short term investment account. Money can be transferred in and out of the account in a Certificate that will each earn a rate of return that is very competitive in today’s marketplace.
- · Minimum Certificate amount is $1,000
- · Maximum Certificate amount has been increased to $200,000
- · Current rate offering would be 2.25% with a floor of 2.0%
- · Variable interest rate subject to change at the discretion of Central Valley Cooperative (not tied to a specific index)
- · Certificate would be due and payable upon demand, but would have no expiration or due date
- · Interest would be compounded quarterly with interest paid at withdrawal
The funds raised through the Demand Note Certificate will be used to offset the short term seasonal borrowing needs of the Cooperative. In addition, it allows the Cooperative to take advantage of early payment discounts offered by manufacturers and suppliers, thus allowing these savings to be passed along to all CVC patrons.
Promissory Note
The Promissory Note program is a Certificate written for a specified period of time. The initial Certificate will have a term of 24 months with a rate offering that is fixed for the period.
- · Minimum Note of $2,500
- · Maximum Note has been increased to $500,000
- · 24 month term
- · Interest would be fixed from time the Certificate was entered into
- · Initial rate offering would be equal to 3.75% and will be fixed for the 24 month term
- · Future Certificate rates may be subject to change at the discretion of Central Valley Cooperative
- · Penalty will be incurred for early withdrawal (6 months worth of interest)
- · Interest would be compounded quarterly with interest paid upon expiration
While the funds raised through the Promissory Note Certificate will typically be used to plan for the current and future capital needs of the Cooperative, these funds can also be used to offset any short term borrowings as well.
Central Valley Cooperative utilizes capital from several sources including; patron’s retained equity, profitability from operations, term debt as well as an ongoing seasonal operating line. The premise behind the Patron Note program is to help expand our level of capital resources together with reducing external borrowings. This will have the effect of increasing the return to our patrons, decreasing interest paid to external sources and ultimately benefiting all patrons of Central Valley Cooperative.
This program will be administered out of the main office in Owatonna located at 900 30th Place NW. Patrons who wish to obtain additional information about the program or wish to enter into Certificates for either the Demand or Promissory programs will need to work directly with Kelly Gallagher. You may also call Pat Hawkins directly to obtain answers to your questions at (507) 456-0738.
As stated earlier, these Certificates are unsecured instruments and not backed by any specific asset belonging to the Cooperative. Furthermore, they are not insured or guaranteed by any; federal, state, local or private entity. However, these Certificates are backed by the financial strength of Central Valley Cooperative whose balance sheet and equity position remains as one of the strongest of any Cooperatives in the State of Minnesota. A copy of our most current Annual Statement is available upon request at any Central Valley location or by sending a request to: Central Valley Cooperative, 900 30th Place NW, Owatonna, MN 55060.
We look forward to the opportunity to continue the development of this exciting program to all current voting members of Central Valley Cooperative. Should you have any questions or like to visit us, please don’t hesitate to call and line up a time to talk or feel free to visit with Pat Hawkins at the phone number listed above.
