Shareholders’ Ordinary Resolution – Approving Payment to Director for Loss of Office

Shareholders’ OR – Approving Payment to Director for Loss of Office

CO.CA.DIR.36

A director’s payment for loss of office (or retirement) will usually be determined by way of his/her contractual entitlement. However, there will be circumstances where a payment is proposed to be made that will be outside a director’s contractual entitlement. A company may not make such a payment unless it has first been approved by the members of the company.

This template can be used to record a resolution, either by the written resolution procedure or at a general meeting of the shareholders, to approve a payment to a director for loss of office or as consideration for or in connection with the retirement of a director from his office. Note that a resolution approving such a payment must not be passed unless a memorandum setting out the proposed payment is submitted to, or made available to, the members of the company. This means an explanatory memorandum must be sent with the written resolution or made available for inspection at the registered office for not less than 15 days beforehand if the resolution is to be put before a general meeting.

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