Rule 1.20 of The Insolvency Rules 1986 - Company Voluntary Arrangements (CVAs)
Shareholders meeting - Votes cast to approve a CVA - The Required Percentage Majority of Shareholders
A meeting of shareholders (as well as a separate meeting of creditors) must approve a Company Voluntary Arrangement (CVA) proposal for it to have effect. Under Insolvency Rule 1.20, at the shareholder's meeting more than 50% in value of those shareholders who actually vote must vote to approve the CVA.
Insolvency Rule 1.20 is reproduced below in bold.
Insolvency Rules 1986 - Chapter 5 - Rule 1.20 - Requisite majorities (members)
(1) Subject as follows, and to any express provision made in the articles, at a company meeting any resolution is to be regarded as passed if voted for by more than one-half [in value] of the members present in person or by proxy and voting on the resolution. [The value of members is determined by reference to the number of votes conferred on each member by the company's articles.]
(3) If the chairman uses a proxy contrary to Rule 1.15, his vote with that proxy does not count towards any majority under this Rule
There is now no sub-section 2 to Rule 1.20. That sub-section was revoked by the Insolvency (Amendment ) (No 2) Rules 2002.
Under Insolvency Rule 1.20 more than 50% of the shareholders who vote must vote to approve the CVA proposal for it to have effect - before further consideration and a further vote at the CVA creditors meeting.