BLP WS8/9
PROCEDURE PLAN
Decisions requiring Shareholder Approval
SPTs, loans to directors, and service contracts over two years
Board meeting 1
Call MA 9: Any director or authorised company secretary can call
Apply to facts
Notice MA 9: Notice must be given to each director, wherever he is, and need not be in writing.
Contents must include MA9(2): Proposed date and time, location, how the directors will communicate if not
in same place.
The notice itself must be reasonable which is what is usual (Re Homer)
Apply to facts – if small company, what is usual is often same day
Interest s177: Interested directors must make a declaration
Apply to facts and look to exemptions – if directors already aware s177(6)(b) or service contract
s177(6)(c)
MA14: Interested directors do not count in quorum nor can they vote
Apply to facts – even if didn’t make declaration won’t be able to count/vote - only for resolutions
they’re interested in
Quorum MA11: Any two of the directors
Is this going to be satisfied? Do we know who is attending?
Say we need at least X and Y – take into account interests – say bare minimum
Resolutions 1 MA3: BR to resolve to approve what is proposed (draft terms/contract) – because need to show SHs
what approval is for that directors are seeking
(a) The draft contract of the SPT
Why they need shareholder approval? s190 members need to pass OR before board can
complete
SEE WS8 notes for details of the steps to take her to establish an SPT
Is there transaction between…
Is the asset substantial?
Is it a non-cash asset?
Why exceptions do not apply?
(b) The draft terms of the loan agreement
Why they need shareholder approval?
SEE WS8 notes for details
Falls until a category of s197(1)
Why no exceptions apply
(c) The draft of the service contract
Why they need shareholder approval?
SEE WS8 notes for details
What is the duration/term of the service contract? s188(3)
Over two years s188(2)
Exceptions do not apply – “unless” ones s188(6)
2 s302: BR to call a GM by BR OR s291 BR to propose a written resolution
Voting MA7: Show of hands by simple majority – more than 50%
State how the decision would pass with what exact directors are needed
MA13: If deadlock, Chair can use their casting vote
Is there a chair? Remember that, practically, avoid doing this – too authoritative
Admin s248/MA15: Directors board minutes/written record of each BR must be kept for 10 years at company’s
registered office or SAIL
s197(3): Directors prepare the memorandum FOR THE LOAN
Nature of the transaction
Amount of loan and its purpose
Extent of company’s liability under any transaction connected with the loan (see s211)
s188(5)(b): Directors prepare the proposed contract FOR THE SERVICE CONTRACT
1
PROCEDURE PLAN
Decisions requiring Shareholder Approval
SPTs, loans to directors, and service contracts over two years
Board meeting 1
Call MA 9: Any director or authorised company secretary can call
Apply to facts
Notice MA 9: Notice must be given to each director, wherever he is, and need not be in writing.
Contents must include MA9(2): Proposed date and time, location, how the directors will communicate if not
in same place.
The notice itself must be reasonable which is what is usual (Re Homer)
Apply to facts – if small company, what is usual is often same day
Interest s177: Interested directors must make a declaration
Apply to facts and look to exemptions – if directors already aware s177(6)(b) or service contract
s177(6)(c)
MA14: Interested directors do not count in quorum nor can they vote
Apply to facts – even if didn’t make declaration won’t be able to count/vote - only for resolutions
they’re interested in
Quorum MA11: Any two of the directors
Is this going to be satisfied? Do we know who is attending?
Say we need at least X and Y – take into account interests – say bare minimum
Resolutions 1 MA3: BR to resolve to approve what is proposed (draft terms/contract) – because need to show SHs
what approval is for that directors are seeking
(a) The draft contract of the SPT
Why they need shareholder approval? s190 members need to pass OR before board can
complete
SEE WS8 notes for details of the steps to take her to establish an SPT
Is there transaction between…
Is the asset substantial?
Is it a non-cash asset?
Why exceptions do not apply?
(b) The draft terms of the loan agreement
Why they need shareholder approval?
SEE WS8 notes for details
Falls until a category of s197(1)
Why no exceptions apply
(c) The draft of the service contract
Why they need shareholder approval?
SEE WS8 notes for details
What is the duration/term of the service contract? s188(3)
Over two years s188(2)
Exceptions do not apply – “unless” ones s188(6)
2 s302: BR to call a GM by BR OR s291 BR to propose a written resolution
Voting MA7: Show of hands by simple majority – more than 50%
State how the decision would pass with what exact directors are needed
MA13: If deadlock, Chair can use their casting vote
Is there a chair? Remember that, practically, avoid doing this – too authoritative
Admin s248/MA15: Directors board minutes/written record of each BR must be kept for 10 years at company’s
registered office or SAIL
s197(3): Directors prepare the memorandum FOR THE LOAN
Nature of the transaction
Amount of loan and its purpose
Extent of company’s liability under any transaction connected with the loan (see s211)
s188(5)(b): Directors prepare the proposed contract FOR THE SERVICE CONTRACT
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