Consolidation of shares definition

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Ordinary resolutions—checklist

Ordinary resolutions—checklist This checklist presents three key tables: • Resolutions specified as ordinary resolutions under CA 2006 • Resolutions which are commonly passed as ordinary resolutions, and • Ordinary resolutions which must be filed with Companies House Ordinary resolutions The Companies Act 2006 (CA 2006) specifies certain matters that must be effected by ordinary resolution (ie simple majority) passed by the members of a company, eg the removal of a director. CA 2006 also specifies certain matters which must be effected by special resolution of the company or where the relevant threshold for effecting a matter is 75%. Where CA 2006 states that something must be done by passing a resolution but does not specify what type of resolution, an ordinary resolution will be adequate (unless the articles of association specify any higher majority or unanimity). Note that: • anything done by ordinary resolution may also be done by special resolution, and • in addition to complying with the requirements of CA 2006 and the company's articles of association (which...

Differences between restructuring plans, schemes of arrangement, and CVAs

Differences between restructuring plans, schemes of arrangement, and CVAs Part 26A restructuring plans The Corporate Insolvency and Governance Act 2020 (CIGA 2020) introduced a new restructuring tool, namely a Part 26A restructuring plan. Consultation responses and discussions with stakeholders persuaded the government of the benefits of modelling the restructuring plan procedure on that of schemes of arrangements. As well as familiarity, this had the advantage of providing a long-established and tested body of jurisprudence that courts are able to draw upon when dealing with certain aspects of restructuring plans and considering matters such as class formation (ie relevant scheme case law is applicable to certain provisions of the new restructuring plan procedure, see: Schemes of arrangement—overview). CIGA 2020 introduced a restructuring procedure that allows a company to bind all creditors or members, including junior (or senior) classes of creditors even if they vote against the plan, through the use of a cross-class cram down (CCCD) provision if certain conditions are satisfied (see Practice Note: Cross-Class Cram Down under a Part...

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Notifying changes in share capital to Companies House—statement of capital

Notifying changes in share capital to Companies House—statement of capital A statement of capital is a snapshot of a company’s share capital at a given time. The Companies Act 2006 (CA 2006) requires that one must be completed by a company in a variety of situations. Requirement for a statement of capital A company with a share capital must be able to provide any of its members with a current statement of capital on request. In addition, a statement of capital must be filed with Companies House in connection with almost all transactions involving a company’s share capital. Such a statement of capital is incorporated as part of each Companies House form filed upon: • an allotment of shares by a limited company (Form SH01) — where a single Form SH01 is notifying a series of allotments, the statement of capital should reflect the company’s position following the most recent allotment being notified • a consolidation of shares (Form SH02) • a sub-division of shares (Form SH02)...

Market Standards—key features and user guide

Market Standards—key features and user guide To access the Market Standards corporate deal analysis database, click here. The Market Standards database can also be accessed via the Tools menu on the right-hand side of the Lexis+® UK Corporate homepage. Lexis+® UK In-house Advisor subscribers can access the database via the Tools menu on the right hand side of the In-House Advisor homepage. Market Standards key features Market Standards is a unique service for corporate lawyers available to Lexis+® UK Corporate and Lexis+® UK In-House Advisor subscribers. At its heart is a deal analysis database which allows users to locate, analyse and compare data in relation to key aspects of public company corporate transactions. Market Standards covers ten transactions or ‘deal' types, including takeovers, initial public offerings (IPOs) and secondary offers. The database also includes analysis of the resolutions and voting at FTSE 350 and AIM 50 annual general meetings (AGMs) and a comprehensive library of the associated annual reports. Key features...

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Resolution—consolidation of shares

Resolution—consolidation of shares ORDINARY RESOLUTION THAT [subject to and conditional upon [insert any conditions relating to the exercise of the power to consolidate shares], ] [[insert number] OR all of the] [insert class] shares of [insert nominal value] each in the capital of the Company [held by [insert

Ireland—Resolution—consolidation of shares

Ireland—Resolution—consolidation of shares This Precedent is an ordinary resolution of the shareholders of a limited company having a share capital that is proposing to consolidate its shares into shares of a larger nominal amount. It specifies that no change is being made to the rights and restrictions (except as to nominal value) attaching to the shares. The resolution assumes that the proposed consolidation will not result in any fractions of shares being created. Section 83 of the Companies Act 2014 (Ireland) (CA 2014(IRL)) permits a limited company having a share capital to exercise a power to consolidate its shares, or any of them, into shares of a larger nominal amount, provided that its shareholders have passed a resolution authorising it to do so. Although this Precedent is for a simple consolidation, a resolution under CA 2014 (IRL), s 83(1)(b) may authorise a company to exercise the power to consolidate shares in combination with the power to sub-divide shares. For a form of resolution to effect a sub-division, see Precedent: Ireland—Resolution—sub-division...

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Are private companies permitted to have shares with a nominal value that is a fraction after a sub-division?

Are private companies permitted to have shares with a nominal value that is a fraction after a sub-division? Articles of association Before proceeding with any sub-division of shares the company’s articles of association will need to be reviewed to ensure that there is no restriction in doing so. Although it is not necessary to have a specific article allowing a sub-division it is possible to have a restriction. If there is a ban on sub-dividing shares within the articles these will need to be amended by special resolution to remove this restriction. Companies Act 2006 Under section 618 of the Companies Act 2006 (CA 2006): '(1) A limited company having a share capital may— (a) sub-divide its shares, or any of them, into shares of a smaller nominal amount than its existing shares, or (b) consolidate and divide all or any of its share capital into shares of a larger nominal amount than its existing shares.' As noted above the articles of the company in question may have...

Can a single class of shares be sub-divided into multiple classes with differing rights if the company has articles in the form of the model articles?

Can a single class of shares be sub-divided into multiple classes with differing rights if the company has articles in the form of the model articles? Section 617 of the Companies Act 2006 (CA 2006) allows a limited company to alter its share capital by sub-dividing its shares. CA 2006, s 618 permits a limited company to exercise a power to sub-divide its shares, or any of them, into shares of a smaller amount than its existing shares, provided that its shareholders have passed a resolution authorising it to do so. The resolution may be an ordinary resolution, unless the company’s articles of association require a higher majority (or unanimity). The proportion between the amount paid and the amount (if any) unpaid on each resulting share must be the same as in the case of the share from which it derived. There is no requirement in CA 2006 for a company to have a power or authority to sub-divide shares in its articles, although the articles...

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Corporate weekly highlights—8 August 2024

This week's edition of Corporate weekly highlights includes news of the FRC’s consultation on revisions to its guidance for companies on the going concern basis of accounting and related reporting. Also, the Private Equity Reporting Group (PERG) and the British Private Equity & Venture Capital Association (BVCA) have launched a consultation on updates to the Walker Guidelines for disclosure and transparency in the private equity industry.