Share Certificates...

[red macca]

If it was a loan then surely paperwork and signatures must of been exchanges.I cant believe power said heres £1.2 million you go pay a few dates and we will worry about how you pay it back later

[TalkTalk]

But they wouldn't realistically be able to control the company unless BHN sided with them, which, assuming it's Diamandis, would be about as likely as me winning the lottery.

I'm not sure about that.

I sold 30% of the shareholding in my company to an investor. He was a wealthy local bloke who liked gambling on small companies and did it all the time. I remember discussing how much he wanted and he declined 33% for this particular reason. The 30% gave him a level of control, the 33% another...

I'll have a dig, I'm sure there is legislation about this.

[Simon Pieman]

If it was a loan then surely paperwork and signatures must of been exchanges.I cant believe power said heres £1.2 million you go pay a few dates and we will worry about how you pay it back later

How can you agree a loan with a company when it's a separate legal entity?

[red macca]

So who did he loan the money to

[Simon Pieman]

But they wouldn't realistically be able to control the company unless BHN sided with them, which, assuming it's Diamandis, would be about as likely as me winning the lottery.

I'm not sure about that.

I sold 30% of the shareholding in my company to an investor. He was a wealthy local bloke who liked gambling on small companies and did it all the time. I remember discussing how much he wanted and he declined 33% for this particular reason. The 30% gave him a level of control, the 33% another...

I'll have a dig, I'm sure there is legislation about this.

Did he buy them as an individual or though a company? I have a feeling he was just keeping his stake at 30% so he wouldn't have to prepare group accounts - 30% shareholding would be an associate and not a subsidiary.

[Simon Pieman]

So who did he loan the money to

the company - which one is anyone's guess but if it was a loan it was to a company

[red macca]

Ok to rephrase my question.Did he not get a signed agreement with the company he loaned the money to

[Sussex]

This could have all been sorted out with a raffle last October. I give up, I really do.

[TalkTalk]

That leads on to the interesting situation in that if the share capital is misstated then the share holding would be:

BOODLE HATFIELD NOMINEES LIMITED 522,023 ORD 1 SHARES (22%)
JAMES S WILLS 1,044,047 ORD 1 SHARES (44%)
PHILIP EMMEL 395,472 ORD 1 SHARES (17%)
WILLIAM POWER 395,473 ORD 1 SHARES (17%)

Giving Phil and Bill 34% of the share holding. More than Boodle and enough to have a serious say in the company (I seem to remember that 33% gives you real clout?)

 

Of course, the club are taking the piss with this shareholding anyway. If it was £1.12M (the other £800k is accepted by the board as being a loan for Bryan Adams, paying King off etc) and they have only issued £790,945 of shares then the other £329,055 would be treated as share premium.

If the shares were pro-rata at nominal value then it would look like:

BOODLE HATFIELD NOMINEES LIMITED 522,023 ORD 1 SHARES (19.4%)
JAMES S WILLS 1,044,047 ORD 1 SHARES (38.9%)
PHILIP EMMEL 560,000 ORD 1 SHARES (20.8%)
WILLIAM POWER 560,000 ORD 1 SHARES (20.8%)

Giving Bill and Phil a larger holding than James Wills.

That would be hilarious.

[TalkTalk]

Ok to rephrase my question.Did he not get a signed agreement with the company he loaned the money to

It doesn't need to be signed on paper to be treated as a loan. As I said, all you need is proof that you paid the money - like a bank statement. It's the default assumption without paperwork saying it was for any other purpose.

[Simon Pieman]

Red Macca - You can't get a company to sign for something - it isn't a human being. Anything a director puts in/takes out of the business goes to a separate director current account which is the amount owed to the director or is owed to the company by the director. I can't remember where exactly the interest terms are kept (if there are any) - I think it's the Articles of Association or something like that. It'll be pre-agreed when the company is set up anyway.

Alan - You can't 'pro rata' share premium into shareholding - it doesn't work like that. You get voting rights according to the amount of shares you have, not what you paid for them

[TalkTalk]

Alan - You can't 'pro rata' share premium into shareholding - it doesn't work like that. You get voting rights according to the amount of shares you have, not what you paid for them

No, I know. I was only musing.

Interesting thought though.

[red macca]

Ok im sure that makes sense to some people

Cheers si

[Simon Pieman]

The gist is you don't need a separate loan agreement with the company.

It's not like a loan with regular repayments and the such...it's more like saying to a mate "I'll lend you £20, give it back to me next friday".

[TalkTalk]

Did he buy them as an individual or though a company? I have a feeling he was just keeping his stake at 30% so he wouldn't have to prepare group accounts - 30% shareholding would be an associate and not a subsidiary.

He bought them as an individual.