THE COMPANIES ACT 2006
COMPANY LIMITED BY GUARANTEE
AND NOT HAVING A SHARE CAPITAL
MEMORANDUM OF ASSOCIATION
ACTIVE STIRLING LIMITED
(Registered in Scotland No SC298585)
(adopted by special resolution dated 17 April 2018)
Constitution of the company, defined terms, objects, powers, restrictions on use of assets, limit on liability, general structure
Qualifications, application, subscription, register, withdrawal, expulsion, termination/transfer
GENERAL MEETINGS (meetings of members)
General, notice, special/ordinary resolutions, procedure
Maximum number, eligibility, election/ retiral/re-election, termination of office, register, office bearers, powers, personal interests
Procedure, conduct of directors
Committees, operation of bank accounts, secretary, minutes, accounting records and annual accounts, notices
1. The model articles of association as prescribed in Schedule 2 to The Companies (Model Articles) Regulations 2008 are excluded in respect of this company.
2. In these articles of association, unless the context requires otherwise:-
“Act” means the Companies Act 2006;
“charity” means a body which is either a “Scottish charity” within the meaning of section 13 of the Charities and Trustee Investment (Scotland) Act 2005 or a “charity” within the meaning of section 1 of the Charities Act 2011, providing (in either case) that its objects are limited to charitable purposes;
“charitable purpose” means a charitable purpose under section 7 of the Charities and Trustee Investment (Scotland) Act 2005 which is also regarded as a charitable purpose in relation to the application of the Taxes Acts;
“conflict of interest” includes a conflict of interest and duty, and a conflict of duty;
“Conflict Situation” means any situation or matter (other than one which cannot reasonably be regarded as likely to give rise to a conflict of interest) in which any director has or could have a direct or indirect interest that conflicts, or possibly might conflict, with the interests of the company including (without limitation) any such situation or matter which relates to the exploitation of any property, information or opportunity (irrespective of whether the company could take advantage of the property, information or opportunity);
“electronic form” has the meaning given in section 1168 of the Act;
“Observer” means an individual appointed pursuant to article 82(b);
“OSCR” means the Office of the Scottish Charity Regulator;
“property” means any property, heritable or moveable, real or personal, wherever situated; and
“subsidiary” has the meaning given in section 1159 of the Act.
3. Any reference to a provision of any legislation (including any statutory instrument) shall include any statutory modification or re-enactment of that provision in force from time to time.
4. The company’s charitable purposes are:
4.1 the advancement of public participation in sport;
4.2 the advancement of citizenship or community involvement; and
4.3 the provision of recreational facilities, or the organisation of recreational activities, with the object of improving the conditions of life for the persons for whom the facilities or activities are primarily intended.
5. In furtherance of the charitable purposes in article 4 the company may undertake all or any of the following:
5.1 provide sport and leisure time activities to enable young people to develop their capabilities through Stirling Council’s pathways to excellence, participation and inclusion programmes and any similar or successor programmes;
5.2 advance and promote public participation in sport, education through sport and healthy living through sport (primarily for the well-being of the residents of the area served by Stirling Council (the “Area”));
5.3 provide and assist in the provision of facilities and services for recreation or other leisure time occupation for the community of and for visitors to the Area in the interests of social welfare, such facilities being provided to the public at large save that special facilities may be provided for persons who by reason of their youth, age, infirmity or disability may have need of special facilities and services;
5.4 provide, operate and manage the provision of leisure and sports and recreation facilities and services by means of the operation of recreation centres in the Area;
5.5 the direct provision of opportunities for participation in sport and physical activity in a number of centres, with provision for, but not limited to gym, fitness space, swimming pool, ice rink, climbing wall and sports courts; outdoor sport and recreation with provision for, but not limited to mountain biking, gorge walking, rock climbing and walking;
5.6 provide an Active Schools programme and supporting physical education in schools and with children and young people;
5.7 provide programmes and lessons to enable sporting participation and progression;
5.8 contribute to urban and rural regeneration by ‘using physical activity and sport intentionally to bring about positive benefits for individuals and communities, to address specific needs’;
5.9 deliver community involvement to build a trained and supported volunteer base, with opportunities for up skilling and personal development;
5.10 a focus on young people to see participation in sport and physical activity as an employability pathway, and as a way to build networks, develop social and team working skills, and raise attainment and achievement;
5.11 support community sports hubs, local sports clubs and associations, and encourage healthy village/active community programmes;
5.12 develop programmes to grow participation in sport and physical activity for those who are disadvantaged, through financial hardship, age, ill health or disability;
5.13 the advancement of health and wellbeing through public participation in sport and physical activity; and
5.14 the carrying on of such other related activities (provided that they further a charitable purpose or purposes) and are consistent with the purposes set out in paragraphs 4.1 to 4.3 (inclusive) above.
6. The company’s purposes are restricted to those set out in article 4. The company may (subject to first obtaining the consent of OSCR) add to, remove or alter the statement of the company’s purposes in article 4; by way of special resolution of the members on any occasion when it does so, it must give notice to the registrar of companies and the amendment will not be effective until that notice is registered on the company’s file at the register of companies.
7. The company has been established as a controlled person for the purposes of Regulation 13 of the Public Contracts (Scotland) Regulations 2015, meaning that:
7.1 The Stirling Council exercises control over the company similar to that which it exercises over its own departments; and
7.2 The company carries out more than 80% of its activities in the performance of tasks entrusted to it by The Stirling Council or by other persons controlled by The Stirling Council; and no other person has direct private capital participation in the company with the exception of non-controlling and non-blocking forms of private capital participation required by any enactment which do not exert a decisive influence over the company.
8. In pursuance of the objects listed in article 5 (but not otherwise), the company shall have the following powers:
8.1 to initiate, promote, conduct, participate in, co-ordinate, monitor and/or assist (whether financially or otherwise) operations, projects, initiatives and events of all kinds which further any of the objects of the company;
8.2 to advise in relation to, prepare, organise, conduct and/or support exhibitions, conferences, seminars and workshops and educational and training events, courses, classes and programmes and events of all kinds;
8.3 to design, prepare, publish and/or distribute information packs, leaflets, books, newsletters, magazines, posters and other publications, audio and video recordings, multimedia products and display materials;
8.4 to create and maintain a website or websites;
8.5 to provide information, advisory, support and/or consultancy services, to commission and/or conduct research, and to publish and promote the results of such research which further any of the objects of the company;
8.6 to liaise with local and national government authorities and agencies, voluntary sector bodies and others, all with a view to maximising the effectiveness of the company in pursuing its objectives;
8.7 to carry on any other activities which appropriately furthers any of the above objects;
8.8 to establish subsidiaries and/or participate in joint ventures;
8.9 to promote companies whose activities may further one or more of the above objects, or may generate income to support the activities of the company, acquire and hold shares in such companies and carry out, in relation to any such company which is a subsidiary of the company, all such functions as may be associated with a holding company;
8.10 to acquire and take over the whole or any part of the undertaking and liabilities of any body holding property or rights which are suitable for the company’s activities;
8.11 to purchase, take on lease, hire, or otherwise acquire, any property or rights which are suitable for the company’s activities;
8.12 to improve, manage, develop, or otherwise deal with, all or any part of the property and rights of the company;
8.13 to sell, let, hire out, license, or otherwise dispose of, all or any part of the property and rights of the company;
8.14 to lend money and give credit (with or without security) and to grant guarantees and issue indemnities;
8.15 to borrow money, and to give security in support of any such borrowings by the company, in support of any obligations undertaken by the company or in support of any guarantee issued by the company;
8.16 to employ such staff as are considered appropriate for the proper conduct of the company’s activities, and to make reasonable provision for the payment of pension and/or other benefits for members of staff, ex-members of staff and their dependants;
8.17 to engage such consultants and advisers as are considered appropriate from time to time;
8.18 to effect insurance of all kinds (which may include officers’ liability insurance);
8.19 to invest any funds which are not immediately required for the company’s activities in such investments as may be considered appropriate (and to dispose of, and vary, such investments);
8.20 To establish and/or support any other charity, and to make donations for any charitable purpose falling within the company’s objects;
8.21 to take such steps as may be deemed appropriate for the purpose of raising funds for the company’s activities;
8.22 to accept grants, donations and legacies of all kinds (and to accept any reasonable conditions attaching to them);
8.23 to oppose, or object to, any application or proceedings which may prejudice the company’s interests;
8.24 to enter into any arrangement with any organisation, government or authority which may be advantageous for the purposes of the activities of the company, and to enter into any arrangement for co-operation or mutual assistance with any charity; and
8.25 to do anything which may be incidental or conducive to the furtherance of any of the company’s objects.
9. Subject to articles 10 and 115:
9.1 the income and property of the company shall be applied solely towards promoting the company’s objects (as set out in article 5).
9.2 no part of the income or property of the company shall be paid or transferred (directly or indirectly) to the members of the company, whether by way of dividend, bonus or otherwise.
9.3 no director of the company shall be appointed as a paid employee of the company and no director shall hold any office under the company for which a salary or fee is payable.
9.4 no benefit (whether in money or in kind) shall be given by the company to any director except (i) repayment of out-of-pocket expenses or (ii) reasonable payment in return for particular services (not being of a management nature) actually rendered to the company.
10. The company shall, notwithstanding the provisions of article 9, be entitled:
10.1 to pay a rent not exceeding the market rent for premises let to the company by any member of the company; and
10.2 to make any transfer or payment to a member where such transfer or payment is made in direct furtherance of the charitable purposes of the company.
11. The liability of The Stirling Council (in its capacity as the sole member of the company) is limited.
12. The Stirling Council member undertakes that if the company is wound up while it is a member (or within one year after it ceases to be a member), it will contribute - up to a maximum of £1 - to the assets of the company, to be applied towards:
12.1 payment of the company’s debts and liabilities contracted before it ceases to be a member;
12.2 payment of the costs, charges and expenses of winding up; and
12.3 adjustment of the rights of the contributories among themselves.
13. Membership shall only be open to The Stirling Council.
Any individual or body who/which is a member of the company but is not eligible for membership under this article shall automatically cease to be a member with effect from the time at which the resolution adopting these articles is passed.
14. The Stirling Council’s membership shall cease on the dissolution of The Stirling Council or on receipt by the company of a notice under article 18.
15. The Stirling Council may not transfer its membership to any other body or to any individual.
16. The Stirling Council may lodge with the company a written application for membership (in such form as the directors may require); the application for membership shall be signed on its behalf by an authorised officer of The Stirling Council.
17. The Stirling Council shall automatically become the sole member of the company upon receipt by the company of the application for membership, duly signed in accordance with article 16.
18. If The Stirling Council wish to withdraw from membership it shall sign, and lodge with the company, a written notice to that effect (in such form as the directors require) signed on its behalf by an authorised officer of The Stirling Council; on receipt of the notice by the company, the company shall take all necessary steps required in order for the company to dissolved.
19. No membership subscription shall be payable.
20. The directors shall maintain a register of members, setting out the full name and address of each member, the date on which he/she was admitted to membership, and the date on which any person ceased to be a member.
21. The directors shall convene an annual general meeting in each year.
22. Not more than 15 months shall elapse between one annual general meeting and the next.
23. The business of each annual general meeting shall include:-
(a) a report by the chair on the activities of the company
(b) consideration of the annual accounts of the company
(c) the election/re-election of directors, as referred to in articles 53 to 59.
24. The directors may convene a general meeting at any time.
25. The directors must convene a general meeting if there is a valid requisition by the member (under section 303 of the Act) or a requisition by a resigning auditor (under section 518 of the Act).
26. At least fourteen (14) clear days’ notice must be given of an annual general meeting or other general meeting to The Stirling Council (in its capacity as sole member of the company), to all the directors and (if auditors are in office at the time) to the auditors.
27. The reference to “clear days” in article 26 shall be taken to mean that, in calculating the period of notice, the day after the notice is posted, (or, in the case of a notice sent by electronic means, the day after it was sent) and also the day of the meeting, should be excluded.
28. A notice calling a meeting shall specify the time and place of the meeting; it shall
(a) indicate the general nature of the business to be dealt with at the meeting;
(b) if a special resolution (see article 45) (or a resolution requiring special notice under the Act) is to be proposed, shall also state that fact, giving the exact terms of the resolution; and
(c) contain a statement informing The Stirling Council of its right to appoint a proxy.
29. A notice convening an annual general meeting shall specify that the meeting is to be an annual general meeting; any other general meeting shall be called an extraordinary general meeting.
30. Notice of every general meeting shall be given:
(a) in hard copy form;
(b) in writing or, (where the individual to whom notice is given has notified the company of an address to be used for the purpose of electronic communication) in electronic form; or
(c) (subject to the company notifying the member of the presence of the notice on the website, and complying with the other requirements of section 309 of the Act) by means of a website.
31. No business shall be dealt with at any general meeting unless a quorum is present; one person present and entitled to vote (being a proxy for The Stirling Council in its capacity as sole member of the company) or a duly authorised representative of The Stirling Council (in that capacity) shall be a quorum.
32. If the quorum required under article 31 is not present within 30 minutes after the time at which a general meeting was due to commence - or if, during a meeting, a quorum ceases to be present - the meeting shall stand adjourned to such time and place as may be fixed by the chairperson of the meeting.
33. The chair of the company shall (if present and willing to act as chairperson) preside as chairperson of each general meeting; if the chair is not present and willing to act as chairperson within 15 minutes after the time at which the meeting was due to commence, the directors present at the meeting shall elect from among themselves the person who will act as chairperson of that meeting.
34. The chairperson of a general meeting may, with the consent of the meeting, adjourn the meeting to such time and place as the chairperson may determine but not for a period in excess of 30 days; no notice shall require to be given of an adjourned meeting.
35. Each of the directors shall, notwithstanding that he/she is not a member, be entitled to attend and to speak at any general meeting.
36. The Stirling Council (in its capacity as the sole member of the company) shall have one vote, which may be given either by its duly authorised representative at the meeting or by proxy.
37. If The Stirling Council (in its capacity as the sole member of the company) wishes to appoint a proxy to vote on its behalf at any meeting (or adjourned meeting) it shall:
(a) lodge with the company, at the company’s registered office, a written instrument of proxy (in such form as the directors require), signed by an appropriate officer of The Stirling Council; or
(b) send by electronic means to the company, at such electronic address as may have been notified to the member by the company for that purpose, an instrument of proxy (in such form as the directors require) providing (in either case), the instrument of proxy is received by the company at the relevant address not less than 48 hours before the time for holding the meeting (or, as the case may be, adjourned meeting). For the avoidance of doubt, in calculating the 48 hour period, no account shall be taken of any day which is not a working day.
38. An instrument of proxy which does not conform with the provisions of article 37, or which is not lodged or sent in accordance with such provisions, shall be invalid.
39. The Stirling Council shall not be entitled to appoint more than one proxy to attend on the same occasion.
40. A proxy appointed to attend and vote at any meeting instead of The Stirling Council shall have the same right as The Stirling Council to speak at the meeting, notwithstanding that they are not a member of the company.
41. The Stirling Council (in its capacity as sole member of the company) may authorise an individual to act as its representative at any general meeting of the company, providing particulars of the individual so authorised are received by the company prior to the commencement of the meeting; the individual so authorised shall be entitled to exercise the same powers on behalf of The Stirling Council as The Stirling Council could exercise if it were an individual member.
42. A vote given, or ballot demanded, by proxy or by an authorised representative of The Stirling Council shall be valid notwithstanding that the authority of the person voting or demanding a ballot had terminated prior to the giving of such vote or demanding of such ballot, unless notice of such termination was received by the company at the company’s registered office (or, where sent by electronic means, was received by the company at the address notified by the company to the member for the purpose of electronic communications) before the commencement of the meeting or adjourned meeting at which the vote was given or the ballot demanded.
43. If there are an equal number of votes for and against any resolution, the chairperson of the meeting shall not be entitled to a casting vote.
44. A resolution put to the vote at a general meeting shall be decided on a show of hands.
45. For the purposes of these articles, a “special resolution” means a resolution passed by 75% or more of the votes cast on the resolution at an annual general meeting or extraordinary general meeting, providing proper notice of the meeting and of the intention to propose the resolution has been given in accordance with articles 26 to 30; for the avoidance of doubt, the reference to a 75% majority relates only to the number of votes cast in favour of the resolution as compared with the number of votes cast against the resolution, and accordingly no account shall be taken of abstentions or members absent from the meeting.
46. In addition to the matters expressly referred to elsewhere in these articles, the provisions of the Act allow the company, by special resolution:
(a) to alter its name; and
(b) to alter any provision of these articles or adopt new articles of association.
47. For the purposes of these articles, an “ordinary resolution” means (without prejudice to articles 48 to 50) a resolution passed by majority vote (taking account only of those votes cast in favour as compared with those votes against), at an annual general meeting or extraordinary general meeting, providing proper notice of the meeting has been given in accordance with articles 26 to 30.
48. A written resolution can be passed by The Stirling Council (in its capacity as sole member of the company) (having been proposed by The Stirling Council or the directors in accordance with procedures detailed in Chapter 2 of Part 13 of the Act) and will have effect as if passed by the company in general meeting; a written resolution will be passed when The Stirling Council has signified its agreement to it by sending to the company (in hard copy or electronic form) an authenticated document which identifies the resolution to which it relates and which indicates The Stirling Council’s agreement to it.
49. For the avoidance of doubt, a resolution to remove a director (under section 168 of the Act) or a resolution to remove an auditor (under section 510 of the Act) cannot be proposed as a written resolution under article 48.
50. For the purposes of article 48, a proposed written resolution will lapse if it is not passed before the end of a period of 28 days beginning with the date on which it is sent or submitted to The Stirling Council, and the agreement of The Stirling Council to a written resolution will be ineffective if signified after the expiry of that period.
51. For the purposes of these articles:
(a) “Council Director” means a director appointed or re-appointed under articles 53 to 57;
(b) “Independent Director” means a director appointed or re-appointed under articles 53 to 58; and
(c) “Health Director” means a director appointed or re-appointed under articles 53 to 58.
52. The maximum number of directors shall be 13 such that:
(a) a maximum of 3 shall be Council Directors;
(b) a maximum of 8 shall be Independent Directors; and
(c) a maximum of 2 shall be Health Directors.
53. Subject to articles 51 and 52, The Stirling Council, so long as it remains a member of the company, may by notice in writing, signed on its behalf by an appropriate officer and given to the company:
(a) appoint any elected member of The Stirling Council who is willing to act to be a Council Director;
(b) remove any Council Director from office as a director;
(c) appoint and re-appoint any person (other than an elected member, officer or employee of The Stirling Council) who is willing so to act to be an Independent Director;
(d) appoint and re-appoint any person (other than an elected member, officer or employee of The Stirling Council) who is willing so to act to be a Health Director; and
(e) remove any Independent Director or Health Director from office as a director.
54. Subject to article 100, The Stirling Council shall exercise its powers under article 53(c) with due regard to the register of suitable candidates maintained from time to time by the Nominations Committee (as defined in article 98) but The Stirling Council shall not be bound in the exercise any of its powers under article 53(c) to appoint or re-appoint any candidate from the register of suitable candidates maintained by the Nominations Committee and can direct the Nominations Committee to seek new suitable candidates. For the avoidance of doubt no elected member, officer or employee of The Stirling Council shall be appointed as an Independent Director.
55. Any appointment or removal of a director under article 53 shall have effect from the date on which the relevant notice is given to the company.
56. The powers conferred by article 53 shall be deemed to be limited such that at any given time no more than:
(a) 3 individuals appointed by The Stirling Council may hold office as Council Directors;
(b) 8 individuals appointed by The Stirling Council may hold office as Independent Directors; and
(c) 2 individuals appointed by The Stirling Council may hold office as Health Directors.
The Independent Directors shall be appointed on the basis of their having skills and experience which would allow them to make a substantial contribution to the work of the board of the directors.
The Health Directors shall be appointed on the basis that they hold a specialist position within The Stirling Council’s key health partners and will be able to provide valuable input from wider community health strategies and plans, and to influence Active Stirling’s own strategy to use sport and physical activity as a preventative measure to tackle health and inequality.
57. Any appointment or removal of a director under these articles shall aim for an equal split of the board in terms of gender.
58. Each of the Independent Directors shall initially hold office until the conclusion of the 2nd annual general meeting which follows the date upon which he/she was appointed but each of them, providing that he/she is willing to act, shall then be eligible for re-appointment under article 53(c).
59. At each annual general meeting one-third of the Independent Directors or, if their number is not three or a multiple of three, the number nearest to one-third, must retire from office. The Independent Directors to retire shall be those who have been longest in office since they were last appointed or re-appointed. If there is only one Independent Director, he or she must retire. If any Independent Directors were appointed or reappointed as directors on the same day those to retire shall (unless they otherwise agree among themselves) be determined by lot.
60. A director shall automatically vacate office if:-
(a) he/she ceases to be a director through the operation of any provision of the Act or becomes prohibited by law from being a director;
(b) he/she becomes debarred under any statutory provision from being a charity trustee;
(c) he/she is sequestrated;
(d) he/she becomes incapable for medical reasons of fulfilling the duties of his/her office and such incapacity is expected to continue for a period of more than six months
(e) in the case of a Council Director, he/she ceases to be an elected member of The Stirling Council;
(f) in the case of a Health Director, he/she ceases to hold a specialist position within The Stirling Council’s health partners;
(g) he/she becomes an employee of the company;
(h) he/she resigns office by notice to the company;
(i) he/she is absent (without permission of the directors) from more than three consecutive meetings of the directors, and the directors resolve to remove him/her from office
(j) he/she is removed from office by resolution of the directors on the grounds that he/she is considered to have committed a material breach of the code of conduct for directors in force from time to time;
(k) he/she is removed from office by resolution of the directors on the grounds that he/she is considered to have been in serious or persistent breach of his/her duties under sub-sections 66(1) or (2) of the Charities and Trustee Investment (Scotland) Act 2005; or
(l) he/she is removed from office by ordinary resolution (special notice having been given) in pursuance of section 168 of the Act.
61. A resolution under article 60(i) or article 60(k) shall only be valid if:
(a) the director who is the subject of the resolution is given reasonable prior written notice by the directors of the grounds upon which the resolution for his/her removal is to be proposed;
(b) the director concerned is given the opportunity to address the meeting of directors at which the resolution is proposed, prior to the resolution being put to the vote; and
(c) at least two-thirds of the directors (to the nearest round number) then in office vote in favour of the resolution.
62. The directors shall maintain a register of directors, setting out full details of each director, including the date on which he/she became a director, and also specifying the date on which any person ceased to hold office as a director.
63. The directors shall elect from among themselves a chair, a vice chair and a treasurer, and such other office bearers (if any) as they consider appropriate. Such appointments shall be made at meetings of directors.
64. All of the office bearers shall cease to hold office at the conclusion of each annual general meeting, but shall then be eligible for re-election.
65. A director shall be eligible to hold office as chair or vice chair for a maximum period of 5 years.
66. A person elected to any office shall cease to hold that office if he/she ceases to be a director, or if he/she resigns from that office by written notice to that effect.
67. If the appointment of a director to any office terminates, the directors shall appoint another director to hold office in his/her place.
68. Subject to the provisions of the Act, and these articles, and subject to any directions given by special resolution, the business of the company shall be managed by the directors, who may exercise all the powers of the company.
69. No alteration of these articles and no direction given by special resolution shall invalidate any prior act of the directors which would have been valid if the alteration had not been made or that direction had not been given.
70. The powers given by article 68 shall not be limited by any special power conferred on the directors by these articles.
71. A meeting of the directors at which a quorum is present may exercise all powers exercisable by the directors.
72. A director who has a personal interest in any transaction or other arrangement which the company is proposing to enter into, must declare that interest at a meeting of the directors; he/she will be debarred from voting on the question of whether or not the company should enter into that arrangement.
73. For the purposes of the preceding article, a director shall be deemed to have a personal interest in an arrangement if any partner or other close relative of his/hers or any firm of which he/she is a partner or any limited company of which he/she is a substantial shareholder or director (or any other party who/which is deemed to be connected with him/her for the purposes of the Act), has a personal interest in that arrangement.
(a) he/she has declared his/her interest;
(b) he/she has not voted on the question of whether or not the company should enter into the relevant arrangement; and
(c) the requirements of article 72 are complied with,
a director will not be debarred from entering into an arrangement with the company in which he/she has a personal interest (or is deemed to have a personal interest under article 73) and may retain any personal benefit which he/she gains from his/her participation in that arrangement.
75. Where a director provides services to the company or might benefit from any remuneration paid to a connected party for such services, then:
(a) the maximum amount of the remuneration must be specified in a written agreement and must be reasonable;
(b) the directors must be satisfied that it would be in the interests of the company to enter into the arrangement (taking account of that maximum amount); and
(c) less than half of the directors must be receiving remuneration from the company (or benefit from remuneration of that nature).
76. The duty of directors under section 175 of the Act to avoid situations under which they have, or could have, a direct or indirect interest that conflicts or possibly might conflict, with the interests of the company shall not extend to any such relationship with The Stirling Council. Directors shall be entitled, for the purposes of section 175 of the Act to authorise (by way of resolution to that effect) any Conflict Situation that may arise (such that the duty of the director concerned, under that section, to avoid conflicts of interest is not infringed) and to amend or vary any such authorisation, the directors may give such authorisations subject to such terms and conditions as they may consider appropriate and reasonable in the circumstances.
77. Any director may call a meeting of the directors or request the secretary to call a meeting of the directors.
78. Questions arising at a meeting of the directors shall be decided by a majority of votes; if an equality of votes arises, the chairperson of the meeting shall not be entitled to a second (casting) vote.
79. No business shall be dealt with at a meeting of the directors unless a quorum is present; the quorum for meetings of the directors shall be 5, including at least one Council Director and 3 Independent Directors. If the quorum is not present within 30 minutes of the time appointed for the meeting, the meeting shall stand adjourned to such time and place as may be fixed by the chairperson of the meeting.
80. For so long as The Stirling Council remains a member of the company:
(a) The Stirling Council shall be entitled to receive all information provided by the company or made generally available by the company to directors (including without prejudice to that generality, advance notice of each board meeting and of each committee of the board, any written agenda specifying the business to be transacted at such meeting together with all papers to be circulated or presented to the same and a copy of the minutes of that meeting); and
(b) The Stirling Council may by notice in writing to the company appoint one Council official as an Observer and remove any such person so appointed and appoint another person in their place. Any such appointment or removal shall take effect at and from the time when the notice is received at the registered office of the company or produced to a board meeting. Any person appointed as an Observer shall:
(i) be entitled to attend and speak, but not vote, at all board meetings or meetings of committees of the board; and
(ii) be at liberty from time to time to discuss the proceedings of such meetings with other officers and elected members of The Stirling Council.
81. If at any time the number of directors in office falls below the number fixed as the quorum, the remaining director(s) may act only for the purpose of calling a general meeting, provided always that for the three month period commencing from the date of adoption of these articles, a quorum of 2 directors (provided that a minimum of one director is a Council Director) shall be sufficient for considering and approving any business in relation to the company.
82. A director may participate in a meeting of directors or a meeting of a committee of directors by means of a conference phone, video conferencing facility or similar communications equipment whereby all directors participating in the meeting can hear each other; a director participating in a meeting in this matter shall be deemed to be present in person at the meeting.
83. Unless he/she is unwilling to do so, the chair of the company shall preside as chairperson at every directors’ meeting at which he/she is present; if the chair is unwilling to act as chairperson or is not present within 15 minutes after the time when the meeting was due to commence, the vice chair will preside. In the absence of the vice-chair, the directors present shall elect from among themselves the person who will act as chairperson of the meeting.
84. The directors may, at their discretion, allow any person who they reasonably consider appropriate, to attend and speak at any meeting of the directors; for the avoidance of doubt, any such person who is invited to attend a directors’ meeting shall not be entitled to vote.
85. A director shall not vote at a directors’ meeting (or at a meeting of a committee) on any resolution concerning a matter in which he/she has a personal interest which conflicts (or may conflict) with the interests of the company; he/she must withdraw from the meeting while an item of that nature is being dealt with.
86. For the purposes of article 85, a person shall be deemed to have a personal interest in a particular matter if any partner or other close relative of his/hers or any firm of which he/she is a partner or any limited company of which he/she is a substantial shareholder or director, has a personal interest in that matter.
87. A Council Director shall, notwithstanding the provisions of articles 85 and 86, be entitled to vote in relation to a particular matter notwithstanding that The Stirling Council has an interest in that matter; but on the basis that in exercising their voting rights in respect of any such matter, the Council Director shall comply with the provisions of articles 88 and 89.
88. A director shall not be counted in the quorum present at a meeting in relation to a resolution on which he/she is not entitled to vote.
89. The company may (subject to the Charities and Investment (Scotland) Act 2005), by ordinary resolution, suspend or relax to any extent – either generally or in relation to any particular matter – the provisions of articles 84 to 88.
90. Each of the directors shall, in exercising his/her functions as a director of the company, act in the interests of the company; and, in particular, must
(a) seek, in good faith, to ensure that the company acts in a manner which is in accordance with its objects;
(b) act with the care and diligence which it is reasonable to expect of a person who is managing the affairs of another person;
(c) in circumstances giving rise to the possibility of a conflict of interest between the company and any other party:
(i) put the interests of the company before that of the other party, in taking decisions as a director; and
(ii) where any other duty prevents him/her from doing so, disclose the conflicting interest to the company and refrain from participating in any discussions or decisions involving the other directors with regard to the matter in question; and
(d) ensure that the company complies with any direction, requirement, notice or duty imposed on it by the Charities and Trustee Investment (Scotland) Act 2005.
91. Each of the directors will comply with the code of conduct (incorporating the detailed rules on conflicts of interest) prescribed by the board of directors from time to time; for the avoidance of doubt, the code of conduct shall be supplemental to the provisions relating to the conduct of directors contained in these articles of association, and the relevant provisions of these articles shall be interpreted and applied in accordance with the provisions of the code of conduct in force from time to time.
92. No director may serve as an employee of the company and (subject to article 95) no director may be given any remuneration by the company for carrying out his/her duties as a director or as Chair or as the holder of any office under article 63.
93. The directors may be paid all travelling and other expenses reasonably incurred by them in connection with their attendance at meetings of the directors, general meetings, or meetings of committees, or otherwise in connection with the carrying out of their duties.
94. The directors may delegate any of their powers to any sub-committee consisting of two or more directors and such other persons (if any) as the directors may determine.
95. Any delegation of powers under article 94 may be made subject to such conditions as the directors may impose and may be revoked or altered.
96. The rules of procedure for any sub-committee shall be as prescribed by the directors. In the absence of any rules and subject to any conditions imposed under article 96, the proceedings of a committee shall be governed by the articles regulating the proceedings of meetings of directors so far as they are capable of applying.
97. The signatures of two out of the signatories appointed by the directors shall be required in relation to all operations (other than lodgement of funds) on the bank and building society accounts held by the company; at least one out of the two signatures must be the signature of a director.
98. The directors shall endeavour to establish a committee (referred to in these articles as the “Nominations Committee”) to maintain for future reference a register of suitable candidates for future appointment or re-appointment of the Independent Directors; declaring that until such time as the Nominations Committee is established, the reference in article 54 to the Nominations Committee shall be disregarded and article 54 shall not apply.
99. The composition and proceedings of the Nominations Committee shall be governed by the directors from time to time but the committee shall include a minimum of two Independent Directors and a maximum of one Council Director.
100. In carrying out its functions, the Nominations Committee shall give effect to the following principles:
100.1 the Nominations Committee should set an appropriate skills matrix to guide it in selecting and evaluating appropriate candidates, and should review and adjust that skills matrix from time to time;
100.2 nominations for directors should be sought from a range of appropriate sources;
100.3 all expressions of interest should be considered by the Nominations Committee; and
100.4 the Nominations Committee should maintain a register of suitable candidates for future reference.
101. The directors shall (notwithstanding the provisions of the Act) appoint a company secretary, and on the basis that the term of the appointment, the remuneration (if any) payable to the company secretary, and the such conditions of appointment shall be as determined by the directors; the company secretary may be removed by the directors at any time.
102. The directors shall ensure that minutes are made of all proceedings at general meetings, directors’ meetings and meetings of committees; a minute of any meeting shall include the names of those present, and (as far as possible) shall be signed by the chairperson of the meeting.
103. The directors shall ensure that proper accounting records are maintained in accordance with all applicable statutory requirements.
104. The directors shall prepare annual accounts, complying with all relevant statutory requirements; if an audit is required under any statutory provisions or if they otherwise think fit, they shall ensure that an audit of such accounts is carried out by a qualified auditor.
105. No member shall (unless he/she is a director) have any right of inspecting any accounting or other records, or any document of the company, except as conferred by statute or as authorised by the directors or as authorised by ordinary resolution of the company.
106. Any notice which requires to be given to a member under these articles shall be given either in writing or by electronic means.
107. A notice may be given personally to the member or be sent by post in a pre-paid envelope addressed to the member at the address last intimated by him/her to the company or (in the case of a member who has notified the company of an address to be used for the purpose of electronic communications) may be given to the member by electronic means.
108. Any notice, if sent by post, shall be deemed to have been given at the expiry of 24 hours after posting; for the purpose of proving that any notice was given, it shall be sufficient to prove that the envelope containing the notice was properly addressed and posted.
109. Any notice sent by electronic means shall be deemed to have been given at the expiry of 24 hours after it is sent; for the purpose of proving that any notice sent by electronic means was indeed sent, it shall be sufficient to provide any of the evidence referred to in the relevant guidance issued from time to time by the Chartered Institute of Secretaries and Administrators.
110. A member may give notice in writing to the company either by sending it by post to the company at its registered office or leaving it, addressed to the company secretary, at the company’s registered office or (where the company has notified the member of an electronic address to be used for this purpose) by way of electronic means.
111. A member present or represented at a meeting of the company shall be deemed to have received notice of the meeting and, where requisite, of the purposes for which it was called.
112. If on the winding-up of the company any property remains after satisfaction of all the company’s debts and liabilities, such property shall be transferred to The Stirling Council at or before the time of dissolution, to be used solely for a charitable purpose or charitable purposes.
113. To the extent that effect cannot be given to article 112, the relevant property shall be applied to some charitable purpose or purposes.
114. Every director or other officer or auditor of the company shall be indemnified (to the extent permitted by sections 232, 234, 235, 532 and 533 of the Act) out of the assets of the company against any loss or liability which he/she may sustain or incur in connection with the execution of the duties of his/her office; that may include, without prejudice to that generality (but only to the extent permitted by those sections of the Act), any liability incurred by him/her in defending any proceedings (whether civil or criminal) in which judgement is given in his/her favour or in which he/she is acquitted or any liability in connection with an application in which relief is granted to him/her by the court from liability for negligence, default or breach of trust in relation to the affairs of the company.
115. The company shall be entitled (subject to the provisions of section 68A of the Charities and Trustee Investment (Scotland) Act 2005) to purchase and maintain insurance against any loss or liability which any director or other officer of the company may sustain or incur in connection with the execution of the duties of his/her office, and such insurance may (subject to the provisions of section 68A of the Charities and Trustee Investment (Scotland) Act 2005) extend to liabilities of the nature referred to in section 232(2) of the Act (negligence etc. of a director).