Section 76 — Companies Act 1993: Financial assistance

76 Financial assistance (1) A company may give financial assistance to a person for the purpose of, or in connection with, the purchase of a share issued or to be issued by the company, or by its holding company, whether directly or indirectly, only if the financial assistance is given in accordance with subsection (2) of this section; and— (a) All shareholders have consented in writing to the giving of the assistance; or (b) The procedure set out in section 78 of this Act is followed; or (c) The financial assistance is given in accordance with section 80 of this Act. (2) A company may give financial assistance under subsection (1) of this section if the board has previously resolved that— (a) The company should provide the assistance; and (b) Giving the assistance is in the best interests of the company; and (c) The terms and conditions under which the assistance is given are fair and reasonable to the company. (3) The resolution must set out in full the grounds for the directors' conclusions. (4) The directors who vote in favour of a resolution under subsection (2) of this section must sign a certificate as to the matters set out in that subsection and may combine that certificate with the certificate required under section 77 of this Act and any certificate required under section 78 of this Act. (5) A company must not give financial assistance under subsection (1) of this section if, after the passing of a resolution under subsection (2) of this section and before the assistance is given, the board ceases to be satisfied that— (a) The giving of the assistance is in the best interests of the company; or (b) The terms and conditions under which the assistance is proposed are fair and reasonable to the company. (6) For the purposes of this section, financial assistance includes a loan, a guarantee, and the provision of a security. (7) Every director who fails to comply with subsection (4) of this section commits an offence and is liable on conviction to the penalty set out in section 373(1) of this Act.