Articles of Association (Company Limited By Guarantee)
Articles of Association for a Private Company Limited by Guarantee follow a similar structure to those used for a Private Company Limited by Shares. The key distinction is that a Private Company Limited by Guarantee does not issue shares; instead, it has members who act as guarantors rather than shareholders. These companies typically adopt the model articles for private companies limited by guarantee, which provide a standardised governance framework in line with the Companies Act 2006.
The members agree to contribute a membership fee or subscription, normally have equal voting rights and elect a board of directors. Any profits (often known as "surpluses") are not distributed as dividends, but may be used to support the activities for which the non-profit organisation is formed.
What does this Articles of Association template include?
These Articles of Association (Company Limited by Guarantee) comply with the Companies Act 2006 and the Model Articles. It provides a structured legal framework covering:
- Membership rules and voting rights
- Board of directors' powers and responsibilities
- Rules on financial management and surplus reinvestment
- Decision-making processes and governance
- Provisions for amending the articles as required
Please note that unless a company creates its own articles excluding or amending the model articles, then the new model articles for that type of company will apply by default. However, businesses and organisations are free to amend, exclude, or adapt certain provisions, provided they comply with the Companies Act 2006. For existing companies, any conflicting provisions in their current articles will be overridden by the Companies Act 2006.
Who should use this document?
This template is ideal for:
- Non-profit organisations seeking a formal governance structure
- Charities and community groups looking to establish a legal framework
- Membership-based organisations such as clubs, trade associations, and co-operatives
- Businesses operating without shareholders, where profit distribution is not the primary goal
How to use this template
This Articles of Association (Company Limited by Guarantee) template is provided in an open format, allowing users to enter key details in the highlighted fields or modify the wording to suit their specific company structure and legal requirements.
Why Subscribe to Corporate Documents for Model Articles for Private Companies Limited by Guarantee?
A Corporate Documents subscription gives charities, non-profits, and corporate organisations access to professionally drafted legal templates, including Model Articles for Private Companies Limited by Guarantee, governance policies, fundraising agreements, shareholder documents, and compliance resources. These templates help organisations meet legal, financial, and regulatory obligations efficiently, ensuring smooth operations and full compliance with the Companies Act 2006.
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