Another in my ongoing series looking at the various implications of the “Entente Cordiale” reached between the various bodies connected with Rangers. This time I am looking at the SPL share.
Bizarrely it seems, if you follow the SPL Articles (ha ha) Rangers Football Club PLC, which is a shell containing no assets, is still a member of the SPL!
That would imply that, like a single cell organism, the process of cell division resulted in there being two “Rangers”, both of them having existed since 1872. Amoeba Rangers!
The undernoted paragraph is extracted from the Joint statement on behalf of The Scottish FA, The Scottish Premier League, The Scottish Football League and Sevco Scotland Ltd. That statement was issued late on Friday evening.
“Following the completion of all legal documentation, the Scottish Premier League will conduct the formal transfer of the league share between RFC (IA) and Dundee FC on no later than Friday 3rd August 2012. At this point, the transfer of Scottish FA membership will be complete.”
The Rules regarding transfer of shares in the SPL are governed by the Articles of Association, which can be read here. These Articles are updated to 30th May 2012. For those of a paranoid mind, the fact that they have been framed for the SPL by Harper MacLeod, a law firm which has worked for Celtic, amongst a great many other clients both in and outside sport, including Craig Whyte, will be a klaxon warning that there is something in them to harm The Rangers Football Club.
If there is, then it is remarkably well hidden. (For the avoidance of doubt, I am not suggesting that there is anything of that nature.)
The relevant Rules are as shown at the bottom of this piece.
What is the present position with the SPL share?
It was part of the parcel of assets and rights sold by Duff + Phelps to Sevco Scotland Ltd for £5.5 million. It was sold at the price of £1, as required by the Articles. However, the transfer of that share from Rangers Football Club PLC (RFC PLC) to Sevco Scotland was refused. Therefore RFC PLC remained the owner of the share although it had sold off the football team which entitled it to be a shareholder.
It then seems that the various formal steps which can be taken by the SPL to force the change have not happened. Therefore the SPL share remains in the hands of RFC PLC and under the control of Duff + Phelps.
Rule 11 applies where transfer of a share is NOT caused by promotion of an SFL club to replace a relegated SPL club. In such an event the members of the SPL, in a General Meeting, must approve the share transfer. It was this which was refused in the case of RFC PLC and Sevco Scotland Ltd.
The accession of Dundee to the SPL, and the demise of Rangers, were not promotion and relegation, as stated in the rules.
Therefore there requires to be a General Meeting to approve the share transfer.
“It was agreed that Dundee FC would be invited to fill the space vacated by Rangers FC in the Clydesdale Bank Premier League.”
Was that the approval of the share transfer? Clearly it could not have been, because if so, it would have taken place.
Article 14 applies in two situations, both of which are applicable to RFC PLC. This arises where a member of the SPL is no longer entitled to hold a share (as was the case here as RFC PLC had sold all assets and business) or where a member has an administrator appointed. If a General Meeting of the SPL passes a Qualified Resolution confirming that the former member should transfer the share to a named entity, then the former member must transfer its share for £1 to the named new member. On doing so the former member ceases to be a member of the SPL, and the new member takes over.
Can this be the case here? If so, no one has mentioned that a Qualified Resolution was passed at the AGM. If it had, then the share transfer ought to have been resolved by now, as I will mention below.
If Article 14 applies, then, until the transfer of the share to Dundee, RFC PLC remains a member of the SPL!
Article 17 deals with the situation where a member refuses or otherwise fails to transfer the share. If the outgoing member fails to transfer the share within seven days of notice having been given of the requirement to transfer, the SPL Board can authorise one of its directors to complete the paperwork as if completed by the member.
Has there been a Qualified Resolution passed by the SPL members under Article 14 ordering transfer of the share from RFC PLC to Dundee?
Have Duff and Phelps been asked to sign a share transfer?
If they have, then why have they not done so?
Is this a sign that, notwithstanding what has been said already about the purchase of the assets and business of Rangers being unconditional, in fact that is not the case, and Duff and Phelps are, for some reason, insisting on holding on to the SPL share? As transfer of it to Sevco Scotland Ltd has been rejected, then Mr Green’s company cannot end up with it, no matter what.
If Duff and Phelps are not handing over the share, when were they issued with a formal request to do so?
How can it be that RFC PLC has remained a member of the SPL, whilst Sevco Scotland Ltd’s team gained membership of the SFL? Did Scottish football expand, even temporarily, to 43 teams? If so, how can Sevco Scotland’s team be the same team as that owned by RFC PLC?
Is it not indicative of the omnishambles that the Rangers FC situation has become that the SPL only anticipate the share to which Dundee is entitled, and which was announced as going to them on 16th July, might not be transferred until the day before they kick off?
Posted by Paul McConville
TRANSFER OF SHARES
11. Except where the transfer of a Share is occasioned by the promotion of an association football club from and relegation of a Club to the SFL, the approval of the Members in General Meeting shall be required before the transfer of any Share shall be registered and the Members may, in their absolute discretion, refuse to approve the registration of the transfer of any such Share.
12. The Members shall not approve the registration of the transfer of a Share for the purposes of Article 11 unless the Board shall first have confirmed that the Board has approved the instrument of transfer and that there exists no circumstances in which the Members shall refuse to approve the registration of the transfer of the Share in terms of Article 13.
13. The Members shall refuse to approve the registration of the transfer of a Share:-
(i) to a person who the Board is not satisfied is or, at the time that the transferee will be entered in the Company’s Register of Members as the holder of the Share, will be the owner and operator of a Club;
(ii) unless the instrument of transfer is lodged at the Office or at such other place as the Board may appoint and is accompanied by the certificate for the Share to which it relates;
(iii) if the transferor and/or transferee shall fail to provide such evidence as the Board may require to demonstrate to the satisfaction of the Board the respective rights of the transferor to make the transfer and the transferee to become a Member;
(v) if the instrument of such transfer is in respect of more than one Share; or
(vi) if the transferee or an Associate of the transferee shall own or have an interest in any other Share.
(i) a Member shall cease to be entitled to hold a Share; or
(ii) a trustee in sequestration, manager, receiver or administrative receiver shall be appointed in respect of a Member or any property of a Member, or an administration order shall be made in respect of a Member or any property of a Member or an order shall be made or an effective resolution passed for the winding up of a Member otherwise than for the purpose of reconstruction or amalgamation;
then that Member or its manager, receiver, administrative receiver, administrator or liquidator or any other person entitled to the Share shall, on receiving notice in writing from the Board following the Company in General Meeting passing a Qualified Resolution that such notice should be issued by the Board and confirming the identity of the proposed transferee, transfer its Share to such other person as the Board shall direct at the price of £1 and the Club owned and operated by such Member shall forthwith cease to be a member of the League and the Club owned and operated by the transferee shall become a member of the League in its place.
15. Notwithstanding the terms of Article 14, the Board shall be entitled, at any time following the final League fixture in any Season, to require a Member to transfer its Share, at a price of £1, upon the Club owned and operated by that Member ceasing to be entitled to participate in the League as a result of its relegation from the League and as and from the date of such requirement such Member shall have no rights in relation to such Share save in relation to Articles 93 and 94 hereof and shall cease to be entitled to be and remain the holder of such Share.
17. Whenever a requirement to transfer a Share shall arise, if the relevant Member shall fail to transfer its Share within seven (7) days of notice having been given of the requirement to transfer, the Board may authorise any Director of the Company to execute a transfer thereof and a transfer so executed shall be valid and effective as if the same had been executed by the Member concerned and the transferee shall on payment of the sum of £1 to the Secretary to be held in trust for the transferor be entered in the register of Members as the holder of such Share.