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Latest FOH email - have your say on supermajority

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Bull's-eye

90% or 75% ?

 

Thoughts fellow members?

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Dunks

No doubt the cynics will say an offer is just waiting to go, but don't see an issue myself.

 

 

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Psychedelicropcircle

90%! the reason I’ve paid into this is that we never again have a mad man in charge. 

 

Why would we want the thing that hasn’t served us well over the past 30 years. 

 

 

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Dannie Boy

One of the reasons we (the Fans) bought the Club was to keep it out of the hands of investors who in reality have no real interest in the soul of the Club. 
In this instance I’d be advising 90%  but ultimately no sell out to some dodgy shysters. 

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JAMBONI

75% seems a more realistic figure.

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Jamboelite
3 minutes ago, Psychedelicropcircle said:

90%! the reason I’ve paid into this is that we never again have a mad man in charge. 

 

Why would we want the thing that hasn’t served us well over the past 30 years. 

 

 

Cause it might restrict Investment and with 90% requirement that could mean a small minority are holding the other 89.9% who want the change.

 

25% seems to be a more sensible number and would indicate a reasonable number for something not to proceed.

Edited by Jamboelite

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been here before

What does it say?

 

My FoH emails seem to have dried up. I keep meaning to email them about it.

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Zaba

90% for me.

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Jamboelite
2 minutes ago, been here before said:

What does it say?

 

My FoH emails seem to have dried up. I keep meaning to email them about it.

FOH want to ask the question whether to change the majority requirement should a third party want to buy us from 90% needed down to 75%.

 

With pros and cons of each choice.

Edited by Jamboelite

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milky_26
1 minute ago, been here before said:

What does it say?

 

My FoH emails seem to have dried up. I keep meaning to email them about it.

check your spam/junk folder

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vegas-voss

So wait we spend this time and money to own our club and the first thing we get is do we want to sell 25% of the club ?

 

**** that

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Sooperstar

OUR GOVERNANCE FRAMEWORK – HAVE YOUR SAY ON THE SUPERMAJORITY

Dear Member

We have decided to revisit an important aspect of our future governance arrangements, and we would like your views.  We attach a short Q&A with this email, the background to which is set out below.

1.    What’s this all about?
Our future governance arrangements contain a restriction on any disposal of the Foundation’s shares in the Club acquired from Bidco.  Before such a disposal to a third party can proceed, it must be put to a vote of Foundation members (including Affiliate Members) and sanctioned by a majority of not less than 90% of the votes cast.
The issue is: Is this 90% requirement too high?  Should the requirement be reduced to 75%?

2.    Why is the board re-opening this topic now?
The review is prompted by two factors.  Firstly, feedback at the AGM in December.  At that meeting, we were urged to look again at the issue, with views being expressed that 90% was too high.  Secondly, awareness of investment trends in Scottish football (see 5.3 below).

We have a window in which to address the topic.  At present, if we decide to change the majority requirement, we need a 75% vote in favour at a general meeting of members.  However, once the ownership of the Club passes to the Foundation (an event scheduled for April), we would need a 90% vote in favour at a general meeting and the logistics of organising that meeting become more complicated.  It therefore makes sense to review the issue over the next few weeks.

3.    Was the 90% requirement discussed in the governance consultation?
Yes.  The 90% requirement was part of our governance proposals throughout the consultation process which ran from April 2017 to November 2018.  At that time, this particular point generated little, if any, comment.
At the end of the consultation period, the members overwhelmingly approved the final proposals.  This approval related to the proposals in their totality, and there were no separate votes on any constituent elements of the proposals.  The request raised at the AGM is effectively that the 90% requirement should now be considered separately.

4.    What are the arguments in favour of a 90% requirement?
[Note: the discussion in 4 and 5 below is framed in terms of the Foundation transferring majority ownership to a new owner.  An alternative scenario of the Foundation transferring a minority interest is, however, also possible.  The 90% approval requirement would extend to that latter scenario.]

4.1    Transferring majority ownership of the Club to a new owner would undoubtedly be the biggest collective decision the Foundation members would ever take.
We would be deciding who the new owner should be, with all the responsibility that places on us.  We would have to decide - are they the right people to own the Club?  Will they have the best interests of the Club at heart, and do they have the financial backing to sustain the Club financially?
A decision of this importance should only be taken with the support of a substantial majority of the voting members.

4.2    A meeting to consider a proposed transfer would be organised so as to maximise the voter turnout.  Early voting (electronically or by mail) would be possible, as well as voting at the meeting in person or by proxy.  A good turnout of members would reduce the risk of a small unrepresentative group of dissident members being able to block the sale.  See 5.1 below.

5.    What are the arguments against a 90% requirement?
5.1    A 90% majority requirement increases the risk of a small and unrepresentative minority being able to block a sale which might be supported by a large majority of members.  Depending on the overall size of the Foundation membership at the time and the proportion of that membership which participates in the vote, the fate of the Club could be decided by a small number of people.  This risk would be reduced if the majority requirement was 75%.

5.2    Football regulation has mechanisms to protect clubs against unscrupulous or untrustworthy individuals acquiring ownership.  A prospective owner or director must be a fit and proper person, and financial regulations are designed to stop clubs careering into financial turmoil.  It is an exaggeration, therefore, to say that a supermajority is required to provide this protection.

[Note: Having said this, it has been suggested at times that the regulatory protections are insufficient in practice, in that prospective owners are not effectively vetted by the football authorities, while financial regulations are subject to numerous caveats and are not strictly enforced.  The shortcomings were highlighted by Bury FC, which was expelled from the English Football League in 2019 as a direct result of poor ownership and longstanding financial problems.]

5.3    The Scottish football scene has changed in the past 12-18 months.  There has been an increase in external investment into our clubs.  A lot of this investment has come from overseas, particularly the US.  Scottish clubs are currently seen as viable assets to attract long-term investment.  The Scottish Premiership is a very competitive league and the pressure on owners to maintain investment and keep pace with their rivals is intense.  If a need for unplanned capital expenditure arises at a club, the fan ownership model is generally not regarded as well-suited to deliver funding.
Approaches to the Club by potential investors have already been made (through Bidco).  If this current climate in Scottish football continues, it is possible that such approaches might start to arrive with even greater frequency.
Against that background, it is arguable that a 75% majority requirement would be more appropriate and more in keeping with normal business practice.  It provides greater flexibility and room for manoeuvre, while nevertheless still requiring a substantial majority in favour of a sale.

6.    How will the views of members on this issue be sought?
We are going to conduct an online survey of our members over a one-week period.  Members will be asked to indicate which majority requirement – 90% or 75% - they favour.  There is also space in the survey to tell us about any comments, questions or concerns you may have.  We will anonymise the identities of respondents.

Click Here to access the survey form. Please enter the email address associated with your FoH Account.

You can complete the survey on your computer or mobile phone.  The survey is open now and will close at 5.00pm on Monday 17 February.  We will release the result of the survey shortly afterwards.

7.    After the survey has been completed, what will happen next?
The survey will be consultative only.  It will inform the decision-making process, as the directors will pay close attention to members’ views, especially if a significant proportion of members have participated.
If the directors conclude that the 90% majority requirement should be retained in its present form, no further action will be needed, as the requirement is already part of the future governance structure.
If the directors conclude that a 75% majority requirement is more appropriate, it will be necessary to alter the articles of association, and we will convene a general meeting of members for that purpose.  For reasons explained in 2 above, we would seek to do that before the Foundation acquires majority ownership of the Club.

I hope you will take the opportunity to give us your views.

Regards
Stuart Wallace
Chair, Foundation of Hearts
10 February 2020

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Jamboelite
2 minutes ago, vegas-voss said:

So wait we spend this time and money to own our club and the first thing we get is do we want to sell 25% of the club ?

 

**** that

No it doesnt say sell 25% . If and its a big IF someone wanted to buy us it would take either a 75% majority or a 90% to make it pass.

Edited by Jamboelite

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Thought Police

People really need to read things before getting all raging.

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been here before
1 minute ago, milky_26 said:

check your spam/junk folder

 

Aye done that each time theres been an FOH email discussed on here.

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Sooperstar

Can't say I'm a fan of the survey being 'consultative only'.

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1971fozzy

90% for me

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Sooperstar
3 minutes ago, vegas-voss said:

So wait we spend this time and money to own our club and the first thing we get is do we want to sell 25% of the club ?

 

**** that

What are you talking about?!

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Getintaethem

This thread will be interesting.  Some of the replies already highlight the problems with fan ownership😂

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Dannie Boy

One interesting thing I gleaned from the email is,

“Approaches to the Club by potential investors have already been made (through Bidco).  If this current climate in Scottish football continues, it is possible that such approaches might start to arrive with even greater frequency.” 

Are we prepared to sell the family silver and gold for some shyster or dubious Whyte characters to strip us bear? We need to make this work for the fans and the club through the fans and through raising monies by winning and advertising.

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jambo3tevie

Got to be 90% for me, even although as the email explains " A 90% majority requirement increases the risk of a small and unrepresentative minority being able to block a sale which might be supported by a large majority of members" it can also work the other way with 75%.

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vegas-voss
4 minutes ago, Jamboelite said:

No it doesnt say sell 25% . If and its a big IF someone wanted to buy us it would take either a 75% majority or a 90% to make it pass.

Ah ok got it now.Thanks

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vegas-voss
4 minutes ago, Sooperstar said:

What are you talking about?!

I should have read the email

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MCW1976
8 minutes ago, Jamboelite said:

Cause it might restrict Investment and with 90% requirement that could mean a small minority are holding the other 89.9% who want the change.

 

25% seems to be a more sensible number and would indicate a reasonable number for something not to proceed.


That small minority might be the difference between Hearts remaining a fit and healthy going concern or Romanov II.

 

Small minorities don’t necessarily mean flawed minorities.

 

Lets remember why the FoH exists in the first place.

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Thought Police
1 minute ago, Dannie Boy said:

One interesting thing I gleaned from the email is,

“Approaches to the Club by potential investors have already been made (through Bidco).  If this current climate in Scottish football continues, it is possible that such approaches might start to arrive with even greater frequency.” 

Are we prepared to sell the family silver and gold for some shyster or dubious Whyte characters to strip us bear? We need to make this work for the fans and the club through the fans and through raising monies by winning and advertising.

It's about decision making. At the moment, you'd need 90% of shareholders to vote for anything to pass. A wee diddy 10.1% could be a right pain by vetoing everything.

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Saint Jambo
Just now, Sooperstar said:

Can't say I'm a fan of the survey being 'consultative only'.

 

Legally, a survey of this type can only be consultative. As explained in the next steps section, the only wa to make a change would be to organise a general meeting of FOH, which would have a formal vote. Assuming they wanted to maximise participation, they would need to put in place a secure online voting proxy voting system. Neither of these things are free. It makes sense to test the feeling of the members before taking on those costs. If it is clear there is no appetite for a change to a 75% threshold they won't proceed.

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Dannie Boy

Football regulation has mechanisms to protect clubs against unscrupulous or untrustworthy individuals acquiring ownership.  A prospective owner or director must be a fit and proper person, and financial regulations are designed to stop clubs careering into financial turmoil.  It is an exaggeration, therefore, to say that a supermajority is required to provide this protection.
 

These regulations don’t work. Dave King and Craig Whyte. The jury is out on the Vermin Yank for the moment.

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Getintaethem

I’m proposing 82.75%, just to hear the collective sigh of despair from the FOH boardroom. 

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MCW1976
Just now, Thought Police said:

It's about decision making. At the moment, you'd need 90% of shareholders to vote for anything to pass. A wee diddy 10.1% could be a right pain by vetoing everything.


Could save the club as well!

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Thought Police
1 minute ago, MCW1976 said:


That small minority might be the difference between Hearts remaining a fit and healthy going concern or Romanov II.

 

Small minorities don’t necessarily mean flawed minorities.

 

Lets remember why the FoH exists in the first place.

Do you think 75% of Foundation Members would ever vote to let something like that happen?

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Psychedelicropcircle
10 minutes ago, Jamboelite said:

Cause it might restrict Investment and with 90% requirement that could mean a small minority are holding the other 89.9% who want the change.

 

25% seems to be a more sensible number and would indicate a reasonable number for something not to proceed.

If we are going forward with a plan to remain debt free why would we be needing investment ?

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Mikey1874
6 minutes ago, Sooperstar said:

Can't say I'm a fan of the survey being 'consultative only'.

 

Asking more widely what people think first. If consensus is to stick with 90% nothing haste happen. 

 

If people seem to prefer 75% it will go to a formal vote. 

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Saint Jambo
Just now, Thought Police said:

It's about decision making. At the moment, you'd need 90% of shareholders to vote for anything to pass. A wee diddy 10.1% could be a right pain by vetoing everything.

Not "for anything to pass". This proposal only relates to FOH selling its share in the club.

 

If people object to a minority being able to block the will of the majority, why would you be happy with the threshold being set at 75% and not 50%?

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JohnB

I've completed the "survey" and opted for the lower 75% which I believe still affords us adequate protection. I also added a comment/question about the identity and proposals of those who have already approached the club. No way I'd ever like to sell but a dilution of shareholding combined with very substantial investment might be a goer. Would like to keep an open mind on our future development.

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indianajones
Just now, Thought Police said:

Do you think 75% of Foundation Members would ever vote to let something like that happen?

 

I'd say minimum 35% wouldn't read the letter and agree to it... 

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Mikey1874
2 minutes ago, Dannie Boy said:

Football regulation has mechanisms to protect clubs against unscrupulous or untrustworthy individuals acquiring ownership.  A prospective owner or director must be a fit and proper person, and financial regulations are designed to stop clubs careering into financial turmoil.  It is an exaggeration, therefore, to say that a supermajority is required to provide this protection.
 

These regulations don’t work. Dave King and Craig Whyte. The jury is out on the Vermin Yank for the moment.

 

Pretty much what the email suggests 

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Dannie Boy
1 minute ago, Thought Police said:

It's about decision making. At the moment, you'd need 90% of shareholders to vote for anything to pass. A wee diddy 10.1% could be a right pain by vetoing everything.


Or a bigger diddy  25.1%. The reason(s) the fans bought the Club was to save it and keep it in fans hands. Sell it, even part of it to some investor was not part of it.

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Special Officer Doofy
23 minutes ago, Noah Claypole said:

90% or 75% ?

 

Thoughts fellow members?


For me it should be in line with the percentage of shares owned by the FoH, so 75%. The Old Firm/Scottish football voting rights issue is not one we want to risk happening at our club. 

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Mikey1874
Just now, Dannie Boy said:


Or a bigger diddy  25.1%. The reason(s) the fans bought the Club was to save it and keep it in fans hands. Sell it, even part of it to some investor was not part of it.

 

But it Hibs, Aberdeen, Dundee United have big money from investors do we just accept being mid / low table. 

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wavydavy
8 minutes ago, Getintaethem said:

This thread will be interesting.  Some of the replies already highlight the problems with fan ownership😂

 

So what are your views on the email then? Are you in favour of the change from 90% to 75%?

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kila

Not a very secure vote is it? All you need is someone's email address ffs?

 

We have accounts for a reason! 

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Mikey1874
Just now, kila said:

Not a very secure vote is it? All you need is someone's email address ffs?

 

We have accounts for a reason! 

 

They can match the address the email was sent to. 

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kila
Just now, Mikey1874 said:

They can match the address the email was sent to. 

 

Uh huh... and is there any verification that the person voting is the owner of that email address?

 

No!

 

 

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Dannie Boy
1 minute ago, Mikey1874 said:

 

But it Hibs, Aberdeen, Dundee United have big money from investors do we just accept being mid / low table. 


I voted 90% myself. 
Having big investors doesn’t mean success. We have sufficient funding at the moment but are anchor at the foot of the table. I think we should run with the current set up and give it time before we go flogging the silver with no guarantee of a successful return on it. 

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manaliveits105

75% cos it has a 5 in it 

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Saint Jambo
1 minute ago, kila said:

Not a very secure vote is it? All you need is someone's email address ffs?

 

We have accounts for a reason! 

 

And this is part of the reason this vote is consultative only. A secure vote costs significantly more to set-up and run. A consultative vote costs less, but if it appears as a result that there is an appetite for change they would then proceed to a formal and secure vote. To material influence the outcome of the consultative vote, someone would need access to hundreds of email addresses of members.

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mitch41

I would imagine 75% is the safest percentage in the long run.

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Haringshairband

90% for me.

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kila
Just now, Saint Jambo said:

And this is part of the reason this vote is consultative only. A secure vote costs significantly more to set-up and run. A consultative vote costs less, but if it appears as a result that there is an appetite for change they would then proceed to a formal and secure vote. To material influence the outcome of the consultative vote, someone would need access to hundreds of email addresses of members.

 

How much did the new FoH website cost? We have accounts, we can log in. It really isn't difficult to set up a voting system on top of that. Of course you could argue I should offer my time to help make such a thing a reality for free...

 

Point is this voting mechanism is not secure by any means, and even if it is consultative only, it is piss poor for a organisation like the FoH and the money being put in to help run the show.

 

 

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EIEIO
10 minutes ago, JohnB said:

I've completed the "survey" and opted for the lower 75% which I believe still affords us adequate protection. I also added a comment/question about the identity and proposals of those who have already approached the club. No way I'd ever like to sell but a dilution of shareholding combined with very substantial investment might be a goer. Would like to keep an open mind on our future development.

I voted for 90 percent if it is a vote on the entire FoH shareholding. However, if it is a vote to sell some FoH shares while leaving us , FoH, with more than 50 percent of HMFC I think 75 percent or even a simple majority would be acceptable.

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