Template Shareholders’ Ordinary Resolution to Enable Directors to Authorise Conflicts of Interest

Shareholders’ Ordinary Resolution - Enabling Directors to Authorise Conflicts of Interest

CO.DIR.01

This Shareholders’ Ordinary Resolution - Enabling Directors to Authorise Conflicts of Interest is for use by companies that were in existence prior to 1st October 2008. An ordinary resolution of members needs to be passed by these companies to permit the board to authorise conflicts.

Such a resolution can be passed at any time, and must be filed at Companies House. Once this resolution has been passed by the shareholders, the company does not need to amend its articles to give the directors the power to authorise conflicts – the ordinary resolution will suffice.

For private companies formed after 1 October 2008, the directors may authorise actual or potential conflicts of interest provided there is nothing in the articles that prevents this.

Shareholders’ Ordinary Resolutions require the votes of over 50% of members present in person or by proxy, who are entitled to vote and do vote at the meeting. The meeting at which the resolution is proposed must have had at least 14 days notice, unless a shorter period was agreed by a majority in number of members holding at least 90% of the shares (95% in the case of public companies).

Alternatively, the written resolution procedure can be used, and the resolution will be passed if approved by shareholders representing not less than 50% of the total voting rights of the shareholders entitled to vote on the written resolution on the day it is circulated.

This document sets out the required wording of the ordinary resolution. If it is to be passed at a general meeting, it should be used in conjunction with “Shareholders’ resolutions – General Meeting Format”. If it is to be passed as a written resolution, it should be used in conjunction with “Shareholders’ Written Ordinary Resolution”.

This Shareholders’ Ordinary Resolution - Enabling Directors to Authorise Conflicts of Interestis in open format. Fields should be completed where indicated. Wording in square brackets is optional and can be deleted or retained according to requirements.

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