Issued share capital definition

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Seller's SPA drafting guide (unconditional completion)—checklist

Seller's SPA drafting guide (unconditional completion)—checklist This Checklist serves as a guide of certain key matters for the seller’s solicitors to consider when drafting, or commenting on, a share purchase agreement (also known as SPA or share sale agreement) recording the sale and purchase of the entire issued share capital of a private limited company, where the transaction involves simultaneous exchange and completion. Parties The drafter should: • check to see if the legal and beneficial title to the sale shares is split, ie check to see if the seller's sale shares are held in the name of a nominee, requiring the beneficial owner to: ◦ be named as the seller in the SPA instead of the registered holder, and ◦ procure the sale of the sale shares to the buyer • check to see if the transaction involves any parties connected with company directors, which may constitute substantial property transactions requiring certain approvals (see Practice Note: Substantial property transactions—requirement to obtain members’ approval) • resist proposals to include in...

Private company share buybacks (no payment out of capital under CA 2006, Pt 18, Ch 5)—checklist

Private company share buybacks (no payment out of capital under CA 2006, Pt 18, Ch 5)—checklist A limited company may buy back shares in itself, if certain conditions set out in the Companies Act 2006 (CA 2006) are met. This is known as a share buyback or a purchase of own shares. In addition to the provisions of the CA 2006, there are other rules and guidelines that are relevant to a listed company or an AIM company. A private limited company will only buy back its shares off-market. Therefore, this checklist does not deal with on-market share buybacks. For an introduction to share buybacks, including an explanation of the differences between an off-market share buyback and an on-market share buyback, see Practice Note: Share buybacks—the legal framework. Preliminary issues Before proceeding with a share buyback, a private limited company should consider a number of issues and may need to take a number of steps. For further information, see Practice Notes: Private company share buybacks—initial considerations and Tax issues on...

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Funding an employee benefit trust

Funding an employee benefit trust This Practice Note covers the following issues in relation to the funding of an employee benefit trust (EBT): • practical aspects of funding an EBT • financial assistance—the background • financial assistance—the current position • relevance of financial assistance to EBTs • financial assistance—exemptions • the employees’ shares scheme exemption • consequences of non-compliance of the financial assistance provisions • tax implications for close companies which fund EBTs, and • corporation tax relief in respect of EBT funding Practical aspects of funding an EBT When an EBT is first set up, it needs to be provided with initial financing, as a trust cannot exist without initial trust assets. It is common for a nominal amount, for example £100, to be settled on the trustee in order to establish the EBT (for further details, see Practice Note: Setting up an EBT). However, after the EBT has established, other funding can be provided. This may be by way of: • voluntary contribution • loan...

Issue of redeemable shares

Issue of redeemable shares A limited company having a share capital may issue redeemable shares. Redeemable shares are a statutory concept contained in the Companies Act 2006 (CA 2006), which includes detailed provisions relating to the terms, manner, financing and timing of their redemption. A redemption of shares by a limited company having a share capital will be void unless it is carried out in accordance with CA 2006, Pt 18 (CA 2006, ss 658–737), which sets out the statutory framework within which a limited company is permitted to acquire its own shares. In addition, if such a company purports to redeem shares without complying with CA 2006, Pt 18, an offence is committed by the company and every one of its officers in default. A person guilty of such an offence is liable: • on conviction on indictment, to imprisonment for a term not exceeding two years or a fine (or both), or • on summary conviction in England and Wales, to imprisonment for a term not...

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Distribution agreement—non-exclusive—short form

Distribution agreement—non-exclusive—short form This Agreement is made on [date] Parties 1 [insert name of party] [of OR a company incorporated in England and Wales under number [insert registered number] whose registered office is at] [insert address] (Manufacturer); and 2 [insert name of party] [of OR a company incorporated in England and Wales under number [insert registered number] whose registered office is at] [insert address] (Distributor); each of the Manufacturer and the Distributor being a party and together they are the parties. Background (A) The Manufacturer manufactures [and supplies] the Products. (B) The Distributor has agreed to distribute the Products on a non-exclusive basis in the Territory in accordance with the provisions of this Agreement. The parties agree: 1 Definitions 1.1 In this Agreement: Active Sales • has the meaning given in Article 8(7) of VABEO; Affiliate • means any entity that directly or indirectly controls, is controlled by, or is in under common control with, another entity where “control” means the beneficial ownership of...

Teaming agreement—short form

Teaming agreement—short form This Agreement is made on [date] Parties 1 [Insert name of party] [of OR a company incorporated in England and Wales under number [insert registered number] whose registered office is at] [insert address] (Party 1); and 2 [Insert name of party] [of OR a company incorporated in England and Wales under number [insert registered number] whose registered office is at] [insert address] (Party 2) Each of Party 1 and Party 2 being a party and together the parties. BACKGROUND (A) Party 1 provides [insert description of goods and/or services]. (B) Party 2 provides [insert description of goods and/or services]. (C) The parties wish to submit a Bid as a joint tender to the Customer in response to the Invitation to Tender. (D) The parties wish to set out their obligations and regulate their rights in relation to the Bid and, if their Bid is successful, they intend to enter the Customer Contract[ and the Joint Venture Agreement] in accordance with this Agreement. The...

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Does a secondary offer have to be made by way of a pre-emptive offer of shares to existing shareholders?

Does a secondary offer have to be made by way of a pre-emptive offer of shares to existing shareholders? The most common types of secondary issue in the UK are rights issues, open offers and placings. Rights issues and open offers are pre-emptive public offers meaning that existing shareholders are given the right to participate in the offer pro rata to their existing shareholdings. Existing shareholders therefore have the opportunity to benefit from any discount to market price at which the new shares are offered and to avoid a dilution of their shareholdings. In contrast, placings are issues of new shares to selected subscribers only and existing shareholders are not given the right to participate (although major shareholders may often be included among the placees). For this reason greater restrictions are placed on the amount of new shares that may be issued and the discount at which they may be acquired. Placings are usually structured so that a prospectus is not required and the process may take place...

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Irish hotels group rejects Scandinavian €1.3bn buyout application

Law360, London: Dalata Hotel Group said late 3 June 2025 it has spurned a consortium's attempted application to buy the Irish hospitality giant in a deal worth approximately €1.3 bn.

Mccann Fitzgerald-led aib €1.2bn buyback set in motion

Law360, London: Dublin-based lender AIB Group plc said 8 May 2025 it has agreed to repurchase €1.2bn worth of its shares from the Irish state as it moves to further reduce the government's stake from its crisis-era financial bailout.