Corporations Act. Australia
(1A) For the purposes of section 20 °C, the conditions set out in subsections (1B) and (2) must be satisfied for there to be member approval under this section for the giving of the benefit.
First condition
(1B) The first condition is that the giving of the benefit be approved by a resolution passed at a general meeting of:
(a) the company; and
(b) if the company is a subsidiary of a listed domestic corporation — the listed corporation; and
(c) if the company has a holding company that:
(i) is a domestic corporation that is not listed; and
(ii) is not itself a subsidiary of a domestic corporation;
the holding company.
Second condition
(2) The second condition is that details of the benefit must be set out in, or accompany, the notice of the general meeting that is to consider the resolution. The details must include:
(a) if the proposed benefit is a payment:
(i) the amount of the payment; or
(ii) if that amount cannot be ascertained at the time of the disclosure — the manner in which that amount is to be calculated and any matter, event or circumstance that will, or is likely to, affect the calculation of that amount; and
(b) otherwise:
(i) the money value of the proposed benefit; or
(ii) if that value cannot be ascertained at the time of the disclosure — the manner in which that value is to be calculated and any matter, event or circumstance that will, or is likely to, affect the calculation of that value.
These requirements are in addition to, and not in derogation of, any other law that requires disclosure to be made with respect to giving or receiving a benefit.
Third condition — for approvals relating to section 200B
(2A) The third condition is that at the general meeting, a vote on the resolution must not be cast (in any capacity) by or on behalf of:
(a) the retiree; or
(b) an associate of the retiree.
(2B) Subsection (2A) does not prevent the casting of a vote if:
(a) it is cast by a person as a proxy appointed by writing that specifies how the proxy is to vote on the resolution; and
(b) it is not cast on behalf of the retiree or an associate of the retiree.
(2C) The regulations may prescribe cases where subsection (2A) does not apply.
Meeting may approve a lesser benefit
(3) For the purposes of subsection (1B), the resolution may give approval by approving the giving of another benefit to the person if:
(a) the other benefit is given to the person instead of the proposed benefit; and
(b) the amount or money value of the benefit is less than the amount or money value of the proposed benefit.
Effect of approval on directors’ duties
(4) Member approval under this section does not relieve a director of a body corporate from any duty to the body corporate (whether under section 180, 181, 182, 183 or 184 or otherwise and whether of a fiduciary nature or not) in connection with the giving of the benefit.
200F Exempt benefits and benefits given in certain circumstances
(1) Subsection 200B(1) does not apply to:
(a) a benefit that is a payment made in respect of leave of absence to which the person is entitled under an industrial instrument; or
(aa) a benefit given under an order of a court; or
(b) a benefit given in prescribed circumstances.
(2) Subsection 200B(1) does not apply to a benefit given in connection with a person’s retirement from an office or position in relation to a company if:
(a) the benefit is:
(i) a genuine payment by way of damages for breach of contract; or
(ii) given to the person under an agreement made between the company and the person before the person became the holder of the office or position as the consideration, or part of the consideration, for the person agreeing to hold the office or position; and
(b) the value of the benefit, when added to the value of all other benefits (if any) already given in connection with the person’s retirement from offices or positions in the company and related bodies corporate, does not exceed the amount worked out under whichever of subsections (3) and (4) is applicable.
(3) This subsection applies if the relevant period for the person is less than 1 year. The amount worked out under this subsection is:
where:
estimated annual base salary is a reasonable estimate of the base salary that the person would have received from the company and related bodies corporate during the relevant period if the relevant period had been 1 year.
Note: The relevant period for the person is defined in subsection (5).
(4) This subsection applies in every other case. The amount worked out under this subsection is:
(a) if the relevant period is 1 year — the base salary that the person received from the company and related bodies corporate during the relevant period; or
(b) if the relevant period is more than 1 year but less than 2 years — the average annual base salary that the person received from the company and related bodies corporate during the relevant period, worked out as if:
(i) the relevant period were 2 years; and
(ii) the person’s annual base salary for the second year were a reasonable estimate of what the person would have received as base salary after the first year of the relevant period had the relevant period been 2 years; or
(c) if the relevant period is 2 years — the average annual base salary that the person received from the company and related bodies corporate during the relevant period; or
(d) if the relevant period is more than 2 years but less than 3 years — the average annual base salary that the person received from the company and related bodies corporate during the relevant period, worked out as if:
(i) the relevant period were 3 years; and
(ii) the person’s annual base salary for the third year were a reasonable estimate of what the person would have received as base salary after the second year of the relevant period had the relevant period been 3 years; or
(e) if the relevant period is 3 years or more — the average annual base salary that the person received from the company and related bodies corporate during the last 3 years of the relevant period.
(5) For the purposes of this section, if a person has held a managerial or executive office in relation to a company:
(a) throughout a period; or
(b) throughout a number of periods;
the relevant period for that person is that period or the period consisting of those periods.
200G Genuine payments of pension and lump sum
(1) Subsection 200B(1) does not apply to a benefit if:
(a) the benefit is a payment in connection with a person’s retirement from an office or position in a company or a related body corporate; and
(b) the payment is for past services the person rendered to: