Board Minutes approving Deed of Release of Debt

These Board Minutes approving a Deed of Release can be used to record the proceedings at a board meeting where a company’s board agrees to enter into a deed that releases a borrower in full from a debt that it owes to the company.

Before a company enters into such a deed, it must have board approval. Generally the write off of a company debt does not require shareholder approval but the company’s articles of association should be checked for anything to the contrary. If there is a parent/subsidiary relationship as regards the lender/borrower, there may be conflict issues to consider and a shareholders’ resolution may be required if the directors of the parent company are also directors of the wholly owned subsidiary.

The directors at this board meeting will also need to consider their Companies Act 2006 duties and particularly their duty to promote the success of the company when making any decision to write off a debt owing to the company.

Note that in relation to the write off of any loan there are likely to be both accounting and tax issues that the company may also need to consider. This is beyond the scope of these board minutes; it is however strongly recommended that you consider seeking the relevant advice in relation to any accounting and tax issues that may arise.

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