THE RANGERS board are to question whether they can veto a call by Sports Direct supremo Mike Ashley for a general meeting showdown to call in his £5 million loan to the club.
The development came as the Rangers Supporters Trust, which represents a host of fan shareholders said Mr Ashley's demand for a meeting was an act of "petulance" saying it served "no practical point" as it widely believed he can demand his millions back at any time.
Mr Ashley, the Newcastle United owner also wants to use the meeting to raise questions about the way would-be chairman Dave King and his fellow directors have operated since the South African businessman swept to power at Ibrox in March.
Mr Ashley's resolution for a general meeting under section 303 of the Companies Act 2006 calls for a shareholder vote calls for the repayment of his £5 million loan within 10 days.
The Herald understands that the prospect of paying back the loan does not phase the directors who are questioning the validity of Mr Ashley's request for the meeting .
Documents relating to the terms of Mr Ashley's loan to Rangers International Football Club plc indicate that he can ask for it to repaid on demand and some insiders believe there is no need for a shareholder vote.
Under the Companies Act, a resolution can be made at a general meeting unless it is "friviolous or vexatious". If it is considered that that is the case, RIFC can notify Mr Ashley that a general meeting will not be convened.
A spokesman for the Rangers Supporters Trust said: "For him to call in a shareholder vote to call in a loan is all just smoke and mirrors and I suspect it is all part of him trying to bully people into position which is what he seems to like to do."
But supporters of Mr Ashley, who owns an 8.9% stake in the club, believe the current board must provide answers over promised future investment, particularly from Mr King, and the directors' management since coming in after an extraordinary general meeting on March 6.
Mr Ashley also wants to use the meeting to ask the current board "the precise reasons" why RIFC is no longer traded on the Aim stock market and what steps the directors took to preserve its status.
RIFC was delisted at the beginning of April after failing to get a Nominated Adviser (Nomad) to oversee their admission.
The development came a month after trading of RIFC shares were suspended from Aim after the club's previous Nomad quit.
The club has been in talks to be listed on the ICAP Securities & Derivatives Exchange stock market, once called Plus Stock Exchange for six weeks.
Mr Ashley wants to use the meeting to ask what steps, if any, directors took to ensure that a prospective Nomad, which acts as a regulator and is crucial for inclusion on Aim, completed its due diligence in advance of a 30 day deadline mandated by the stock exchange rules. Mr Ashley also wants to know what the directors did to identify and communicate with any other potential Nomads within the deadline period.
He has asked what steps the directors have taken to secure a "suitable alternative publicly traded market for the company" and what has been done "to protect the interests of the shareholders of the company and ensure that the company adheres to good standards of corporate governance..."
Mr Ashley, also requests to know under what terms the £1.5 million loan provided by Three Bears shareholders Douglas Park, George Letham and George Taylor was made.
Rangers declined to comment on the Ashley meeting call.
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