Avenir Forêt is subject to rules & regulations listed in a 20 page legal document, registered at the business court (tribunal de commerce) in Brive-la-Gaillarde, the administrative center for Corrèze.
Avenir Forêt is a non-trading forest land real estate company usually refered to as shared forest investment group or shared forest group ("Groupement Forestier"). It is a contract binding a certain number of private individuals in order to create a legal entity in which each individual owns a number of shares.
The shared forest group is a light structure, not heavily regulated, designed specifically for forest management and has considerable liberty in the drafting of its legal statutes. That makes it the ideal tool for investors wishing to group together in order to reach the financial threshold necessary to purchase forest plots (parcels).
This type of structure conventionally operates with capital as shares. It is monitored by a yearly general assembly and is coordinated by one or more managers who are in charge of the group's activities and well-being and are accountable to the associates.
The Avenir Forêt shared forest investment group is registered by notarial deed in the commercial and company registry (registrar office of the commercial court of Brive). The shared forest group's head office is located at the managers residence (Coulié, Sainte-Féréole in Corrèze).
Share capital and nature of contributions
Contributions are primarily cash consideration, and exceptionally a contribution in kind in the form of a forest can be reviewed and considered by the managers, and be presented at the general assembly. The group's share capital is variable, as the managers hold the power to accept new associates during the ongoing year.
Newcomers are retrospectively approved during the general assembly. The medium term goal is for the group's share capital to be expressed in millions in order to be able to purchase several hundred hectares of forest. The shares have a nominal value of 10 euros each for technical reasons in the fine distribution amongst associates. However, an associate must own at least 1.000 shares, worth 10.000 euros, in order to invest in the shared forest group.
For the sake of balance, a single associate can not own more than 10% of the total share capital. This is done in order to prevent any internal rivalries or power struggles to become majority shareholder.
Profits generated are primarily reinvested into more forest land in order to secure the shared forest group's growthand its worth.
The value of each share is reevaluated annually depending on the change of the group's global worth. This global worth is estimated every 5 years by outside experts.
The rules include provisions intended to avoid pitfalls sometimes encountered in forestry groups.
No associate may own more than 10% of the group’s capital, to ensure that all associates have a say in the group’s choices.
To avoid an uncontrolled increase in the number of associates over the years, associates’ share packets are indivisible: they can only be owned by individuals (and not, for example, by couples) and they can only be sold or passed on to individuals (preferably interested in ecological forest management!).
Should an individual wish to leave the group, the group has first right-of-refusal to buy his or her’s shares. Shares thus re-acquired by the Group will then be distributed among the remaining associates on a pro rata basis. The Group maintains cash reserves adequate to handle such occasional buy-backs. Should the Group choose not to buy the individual’s shares, the remaining associates then have the option to acquire them.