In my understanding, a CBS must have legal control of a business. In order to do that it must have more than a holding of 50% of the shares, so if necessary it can ultimately determine how that business is run i.e the requirement is to be running a business. It is also clear from FCA guidance that a CBS cannot exist as such if it simply owns shares in a business. The FCA guidance for a CBS is here if you would like to look at the guidance yourself:https://www.fca.org.uk/publication/fina ... g15-12.pdf.Bangitintrnet wrote: April 11th, 2024, 5:03 pmAs the trust are still percentage part owners of the club and have representatives on the board of the club, can you confirm why you think the trust is not performing the part function of a business?Chris Davis wrote: April 11th, 2024, 4:44 pmThese are the objects of the Trust under the existing Model Rules:rncfc wrote: April 11th, 2024, 4:33 pm To the average fan who just wants to help out, this isn't half a load of boring old sh1t.
Is there anyone out there who will, at some point, put the objectives of the trust and what sort of funding we're trying to achieve in words of one syllable?
OBJECTS
4. The Club’s objects are to benefit the community by;
4.1 enhancing the social, cultural and economic value of the Club to its Communities and
by acting as a responsible custodian of the club for future generations;
4.2 upholding the mutual ownership of the Club operating democratically, fairly and
transparently;
4.3 ensuring the Club operates with financial responsibility enabling the Club to be run
for the long term interest of the Community;
4.4 providing sporting facilities and opportunities regardless of age, income, ethnicity,
gender, disability, sexuality, religious or moral belief; and
4.5 playing at the highest level possible, but always operating in a financially responsible
and prudent manner.
These are the objects under the proposed Model Rules:
OBJECTS
4. The Society’s Objects are to benefit the community by:
4.1 being the democratic and representative voice of the supporters of the Club and
strengthening the bonds between the Club and the communities which it serves;
4.2 achieving the greatest possible supporter and community influence in the running
and ownership of the Club;
4.3 promoting responsible and constructive community engagement by present and
future members of the communities served by the Club and encouraging the Club to
do the same;
4.4 operating democratically, fairly, sustainably, transparently and with financial
responsibility and encouraging the Club to do the same;
4.5 being a positive, inclusive and representative organisation, open and accessible to all
supporters of the Club regardless of their age, income, ethnicity, gender, disability,
sexuality or religious or moral belief.
I hope that helps you.
Second question, as the shares as effectively worthless, can the entire share capital simply be reduced by the Trust's holding. I. E. Cancel the trust's holding to effectively increase both HJ and the remaining shareholders holdings? That is to not increase HJ's holding to greatly, as to make it worthwhile him cashing out at some point (without other shareholders benefiting).
I think that it is unlikely that the shares can be dealt with as you suggest and certainly not without the approval of the Trust membership in advance. Effectively, the Trust membership would be approving or notthe giving away of all shareholders right that come with ownership of those shares. It would also likely need to be authorised by the AFC's articles of association. I would think a much simpler way of doing it, if the membership wanted it done, would be for the Trust to repeat the transfer process that brought HJ into ownership.