FAQ

Hibernian Supporters Limited recently requested that the fan websites Hibs.Net and Hibees Bounce submit questions from their membership-asking question about the initiative. Here are both the questions and the answers provided:

HIBS.NET Q&A

1. Can HSL confirm that none of the money they receive from supporters to buy shares will be used to pay off the debt to the holding company?

 

All of the funds received from supporters will be handed to the Club. HSL in return will receive shares in HFC. The Board of HFC will use these funds as they see fit. The Club’s new mortgage will be paid, as has always been the case in the past, from all of the various income streams that the club has.

Funds received from HSL will be new money that the Club did not previously have and we have been assured, which was confirmed by the recent statement from Leeann Dempster, as such will be available to get the Club back to where we all want it to be, at the forefront of Scottish football.

 

2.  What are the projected administration costs of HSL and will these be deducted from the funds raised through contributions?

 

We would anticipate these to be very low and any costs will be for essential needs such as ensuring our accounts and finances are properly audited. None of the Directors of HSL will receive any money either by way of salary or expenses.

 

3. Are any members of the HSL board being paid by HSL?

 

No, and the articles of association specifically prohibit this.

 

4.  In the case of Leeann Dempster, is there not a conflict of interest between being an HSL board member and a Hibs board member?

 

HSL has a very simple function and that is to safely receive funds from supporters who wish to contribute and ensure that in exchange we receive shares in HFC. With this in mind it is difficult to see where any such conflict exists, and in any event Leeann is only one Director among seven, five of who are member nominated.

 

5.  As an existing shareholder I have the opportunity to buy shares quite easily. Are there any advantages to those like me in becoming an HSL member?

 

As you will appreciate we have to be careful in what we say as a result of the regulatory regime that surrounds this process. Supporters have the option to choose the route that is right for them personally.

It should come as no surprise however that our views are shaped around the principles of mutuality and community. We have greater strength in numbers and for us there is something very strong in the values of those able to contribute more to the cause accepting the principle that they share the one vote as a supporter less able to contribute.

In addition we will have a tangible influence that will be democratically governed. When we achieve a 20% stake we can elect a Director to the HFC Board. If we achieve a 26% stake we have an overall blocking vote on major issues.

 

6. Can my HSL membership be handed down to my family in the same way that my Hibs shares can?

 

Yes, subject to the normal Membership criteria being met.

 

7.  What would happen to my membership if I sign up for a monthly payment and I had to stop making payments as my circumstances changed before the term was complete?

 

Nothing, it would simply be paused. This is about goodwill. If a supporter losses their job or something else makes it temporarily difficult we would recognise this and allow them to carry on contributions when they are in a position to do so.

 

8.  If you contributed the full amount in year 1 and stopped payment in year 2 would you still have vote/membership in HSL?

 

Yes. Once membership has been achieved it is for supporters to decide. If shares are still available you may choose to continue, to allow HSL to continue to increase the supporters’ stake in the Club.

 

9.  Will members be able to vote on/off Directors of the HSL board?

 

Yes. Founding Directors resign after 3 years.

 

10.  Will non-HSL members be able to be voted onto the HSL board?

 

No

 

11.  When will the first membership meeting be held to elect the board?

 

To provide stability the founding members are appointed for 3 years after which they will resign and stand for re-election. The articles outline the procedure.  Therefore the first elections will be in 2018.

 

12.  How often do HSL expect to consult the members, or will members simply elect a board who will have executive authority to make all decisions regarding how the HSL shareholding will vote?

 

Clearly we shall consult before every AGM however in general terms consultation requirements will be driven by the members.  Voting intentions at the AGM will be determined by a simple majority of the membership.

The Directors will start a process of consultation when there are sufficient members to determine the form and method of taking members wishes to the Board of HFC.  When we achieve 20% of the shares we will have a Director on the Board and therefore direct access.

 

13.  If the membership of HSL is split on an issue (say 55-45) will the whole HSL shareholding vote in accordance with the 55%, or will it be pro-rated?

 

The democratic process would prevail. Voting intentions at the AGM will be determined by a simple majority of the membership.

 

14.  Have HSL set a target date for the £2.5m to be raised?

 

No. We have a Subscription Agreement that allows us to buy shares so long as these remain available. Everyone knows this is just the start of a journey and it may take some time. Of course, the more contributors, the shorter the journey.

 

15.  Once the £2.5m has been raised, will HSL continue to seek the annual membership fee? If so, will this be done with a view to a subsequent share issue? If not, how will membership be determined?

 

No. HSL can only collect funds if there are shares to buy. Membership is for life subject to meeting the Membership criteria.

 

16.  Assuming that the full 51% of shares is taken - what might the board of Hibs look like? How will HSL be represented on the Board of the football club?

 

That will be a matter for the Shareholders to decide at that time.

 

HSL’s shareholding will be determined by the generosity and ambitions of the supporters and the take up of shares bought up directly by other Supporters. Our initial ambition is to achieve at least a 26% shareholding. HSL have a legal right to nominate one Director to the HFC Board on achieving a 20% stake.

 

17.  Are there plans to hold elections for the HSL board, as has happened with fans representatives on the Hibs board?

 

To provide stability the founding members are appointed for 3 years after which they will resign and stand for re-election. The articles outline the procedure.  Therefore the first elections will be in 2018.

 

18.  If I commit to paying £18.75 per month, how long does this payment need to go on for, we know the minimum is a year, but would this continue if share issue isn't fully taken up?

 

A. Yes. Once membership has been achieved it is for supporters to decide. If shares are still available you may choose to continue, to allow HSL to continue to increase the supporters’ stake in the Club.

 

19.  To what extent will there be - on say an annual basis - at least a top-level breakdown of where the funds raised by HSL have been spent?

 

As far as HSL is concerned we will present fully audited accounts each year at their AGM. Other than minimum essential expenses all of the funds raised will be used to acquire shares in HFC.

In terms of how HFC use the funds we raise, we will receive regular updates from the Club on how those have been used to support all our ambitions to return Hibernian to the top of Scottish Football.  We shall ensure during our consultation with members we pass this information on.

 

20.  What alternative payment methods other than a UK bank direct debit will there be?  Will there be any obstacles to donating from a foreign bank account?

 

We will be able to receive UK sterling denominated cheques; there will not be any provision for cash payments. We will be able to receive payments into our account from overseas.

 

21.  Is it HSL's intention to have multiples classes of members, ether now or in the future?

 

There is only one class of Membership. Future decisions on membership classes will be determined by the Membership.

 

22.  What happens to the structure of HSL once all of the shares are bought?

Nothing.

 

 

23.  Would HSL be open to forming an association with other fan shareholders?

Our sole function, as outlined in our Articles, is to collect funds and buy shares in HFC.

 

24.  Which bank will hold the funds raised?

The Co-Operative Bank

 

25.  How frequently will funds be exchanged for shares?

Every time we reach £10,000 in donations.

 

26.  Will a constitution be drawn up for guidance of the Board and members?

 

Yes. This will be developed over the coming months.  Full consultation with members will occur.

 

27. Will there be a life member option in exchange for a large single up front payment?

 

Membership is for life unless a member breaches the articles or rules that will form a part of the constitution.

 

28.  What makes HSL contribution different from handing £300 into the office?

 

Subject to meeting the eligibility criteria for Membership you will acquire legal ownership in a HSL that has legal ownership of shares in HFC. You will receive a Membership Certificate to demonstrate proof of that ownership and of course have a voice in a democratic process.

 

29.  Are there any other benefits in donating to HSL?

 

Members can feel part of a powerful collective that is securing the future of the Club and helping it achieve a return to the top of Scottish football. There will be no other benefits offered.

 

30.  What happens to the money raised if company goes to the wall?

 

Given the simplicity of its function it is hard to see how a wind up situation could arise however in such an unlikely scenario any funds available will be paid to Charity.  It would not be distributed to Members.

 

31.  Has HSL done any research on what sort of take up might be likely on this share offer to supporters? Or is this simply impossible to predict? Has HSL taken any soundings on this?

 

Yes some basic research was undertaken along with consideration of two recent surveys carried out, however, supporters will ultimately determine the take up.

 

 

 

 

 

HIBEES BOUNCE Q&A

1. Can HSL confirm that none of the money they receive from supporters to buy shares will be used to pay off the debt to the holding company?

 

All of the funds received from supporters will be handed to the Club. HSL in return will receive shares in HFC. The Board of HFC will use these funds as they see fit. The Club’s new mortgage will be paid, as has always been the case in the past, from all of the various income streams that the club has.

 

Funds received from HSL will be new money that the Club did not previously have and we have been assured, which was confirmed by the recent statement from Leeann Dempster, as such will be available to get the Club back to where we all want it to be, at the forefront of Scottish football.

 

2. What are the projected administration costs of the company (accounting, legal and particularly management costs etc.) and will these be deducted from the funds raised through fans' investments?

 

We would anticipate these to be very low and any costs will be for essential needs such as ensuring our accounts and finances are properly audited. None of the Directors of HSL will receive any money either by way of salary or expenses.

 

It is of course also important to realise that any donations/contributions should not be viewed as “investment” in the normal sense of the word. Fans will not see their money again and should only consider contributing funds they can comfortably afford.

 

3. I wouldn't want it to be used for that BUT if we're making a loss and we have debts to pay then do we use it?

 

All of the funds received from supporters will be handed to the Club. HSL in return will receive shares in HFC. The Board of HFC will use these funds as they see fit. The Club’s working capital needs are met from a variety of sources as has always been, such as season tickets and other commercial revenues.

 

Funds received from HSL will be new money that the Club did not previously have and we have been assured, which was confirmed by the recent statement from Leeann Dempster, as such will be available to get the Club back to where we all want it to be, at the forefront of Scottish football.

 

4. I have the opportunity to buy shares directly or a membership of HSL. Are there any advantages to those like me in becoming a HSL member?

 

As you will appreciate we have to be careful in what we say as a result of the regulatory regime that surrounds this process. Supporters have the option to choose the route that is right for them personally.

 

It should come as no surprise however that our views are shaped around the principles of mutuality and community. We have greater strength in numbers and for us there is something very strong in the values of those able to contribute more to the cause accepting the principle that they share the one vote as a supporter less able to contribute.

 

In addition we will have a tangible influence that will be democratically governed. When we achieve a 20% stake we can elect a Director to the HFC Board. If we achieve a 26% stake we have an overall blocking vote on major issues.

 

5. I can leave my current shares to my Hibs supporting children. Could I do the same with my HSL membership?

 

Yes, subject to the normal membership criteria.

 

If I were to sign up for a monthly payment and my circumstances changed before the term was complete what would happen to my membership?

 

Nothing, it would simply be paused. This is about goodwill. If a supporter losses their job or something else makes it temporarily difficult we would recognise this and allow them to carry on contributions when they are in a position to do so.

 

6. Will the membership be able to vote on/off members of the HSL Board?

 

Yes. Founding Directors resign after 3 years.

 

7. Have HSL set a target date for the £2.5m to be raised? If so what is it?

 

No. We have a Subscription Agreement that allows us to buy shares so long as these remain available. Everyone knows this is just the start of a journey and it may take some time. Of course, the more contributors, the shorter the journey.

 

8. Do HSL have plans beyond raising £2.5m?

 

No. HSL can only collect funds if there are shares to buy.

 

9. Do HSL have 51% of shares in the club allocated to them regardlessof fans purchasing shares, or is 51% the total volume of shares available to all current fan ownership routes?

 

No, HSL does not have 51% of the shares allocated to it. Existing fans already own about 1% of the shares and a further 50% will be made available. How much HSL acquires will be determined by the take up rate of fans choosing to buy directly from the Club and the generosity and ambition of those fans choosing to donate to HSL.

 

 

10. Will control of 51% of shares give HSL the ability to appoint directors without the consent of minority shareholders, and will HSL or an HSL-controlled board of directors have the power to remove the chairman?

 

HSL cannot acquire 51% shareholding as existing fans already hold around 1%, unless existing shareholders elect to sell those shares to HSL.

 

Should HSL achieve a 20% stake in the Club we will be able to nominate a Director to the Club Board. Should all supporters respond positively to this initiative the shareholding of HFC Holdings will be diluted down to 49%.

 

Voting intentions at the HFC AGM will be determined by a simple majority of the membership of HSL.

 

11. Does STF's long-standing claim that he's prepared to sell to the right bidder mean that, should this happen before the 2.5m figure is reached, the promise to issue shares to HSL and/or individual fans to the value of 51% could be broken by a new majority shareholder?

 

This is a question we cannot answer, as we cannot speak for the owners.  What we can say is that we have a legally binding subscription agreement that enables us to buy shares that are available to purchase. Once HSL owns the shares no one can determine what happens to these shares other than the members of HSL.  The quicker we raise funds the quicker we can buy shares. The more funds we raise the more shares we can buy

 

Hibernian Supporters Limited 2015

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