Consultancy Agreement: company (individual side letter)
This Consultancy Agreement individual side letter is for use by a company in conjunction with a Consultancy Agreement between the client and the individual’s service company.
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When do I use this document?
- where an individual’s personal service company has been appointed to act as a consultant
- for the individual to give direct legal undertakings to the client
What are the key features?
- legally binding undertakings from the individual which owns the service company to the client
- undertakings relating the following matters:
- continued ownership of the service company by the individual
- availability of the individual to perform the services
- performance of the Consultancy Agreement by the service company
- continued employment of the individual by the service company
- ownership of intellectual property in materials/work product generated during the consultancy
What else do I need to know?
This is a Side letter to a consultancy agreement where the consultant is an individual’s personal service company. Under the side letter, the individual gives undertakings to the client regarding the personal service company and compliance with the consultancy agreement. This letter is for use in conjunction with a Consultancy Agreement between the client and the individual’s service company.
A Consultancy Agreement may be for the appointment by the client of an individual’s personal service company. The service company agrees to provide consultancy services to the client, which will be carried out by the individual.
The individual is not a party to the Consultancy Agreement itself, which is between the client and the service company.
To help ensure that the individual will be available to provide the services and responsible for the performance of the Consultancy Agreement by the service company, the client will often require a letter from the individual to the client under which the individual will enter into legally binding undertakings directly with the client.
More information about consultancy agreements
What other documents are available?
For a form of consultancy for a service company on a time basis, see
For a form of consultancy agreement with a service company on a project basis, see
When do I use this document?
- where one or more shareholders wish to remove a director
- where the Articles of Association do not include a simpler removal process
- as special notice pursuant to the Companies Act 2006 to remove a director
Key features
- special notice required to remove a director from office
- including an ordinary resolution to remove a director, for use by either a single shareholder or multiple shareholders
- alternative forms covering:
- removal of director only
- removal of director and appointment of replacement director
What else do I need to know?
Under section 168 of the Companies Act 2006, shareholders can remove a director by passing an ordinary resolution at a general meeting. This decision cannot be made by written resolution. The shareholder proposing the removal must give formal notice to the company. The Articles of Association cannot override this statutory process or change the notice periods required for the process.
Once the company receives special notice, the board must call a shareholder meeting. This meeting must take place at least 28 days after the notice is received. The director facing removal has the right to submit written representations, which the company must circulate to shareholders before the meeting.
The special notice may also propose appointing a new director to replace the one being removed.
In some companies, weighted voting rights can protect shareholder-directors being removed from office by granting them extra votes on removal resolutions. This is common in joint ventures, multi-shareholder businesses, or investor agreements where director rights need protection.
Being removed as a director does not affect employment rights, but it may lead to legal claims, such as wrongful dismissal. If the removed director is also a shareholder, they may claim unfair prejudice under the Companies Act 2006 – particularly in quasi-partnerships, where they expected to be involved in management. If the claim succeeds, the court may order other shareholders to buy their shares at fair value.
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Updated by a lawyer on 03/09/2024
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