Q&As

Are there any special provisions for the transfer of deferred shares?

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Published on LexisPSL on 25/10/2017

The following Corporate Q&A provides comprehensive and up to date legal information covering:

  • Are there any special provisions for the transfer of deferred shares?
  • Deferred shares
  • Transfer of deferred shares

Deferred shares

A deferred share is one where the ability to participate in dividends or a return of capital is deferred to all other classes of share capital, including ordinary shares. Such shares (sometimes referred to as ‘founders’ shares’) may be granted to promoters of a company to give them a stake in the company while leaving the voting shares available for subscription by other investors. In recent times, deferred shares have commonly arisen on a conversion of shares (pursuant to a company’s articles) where convertible preference shares convert into a certain number of ordinary shares. A company’s articles may provide that if the resulting nominal value of the or

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