Board Minutes – approval of a dividend in specie

These board minutes can be used to recommend a dividend where a company declares a specified cash amount to be satisfied by the transfer of non-cash assets of equivalent value (a dividend in specie).

What is a dividend in specie?

A dividend in specie (or “dividend in kind”) is a distribution of a particular asset (or assets) to shareholders as an alternative to a cash dividend. It often involves the transfer of an asset such as property, an investment, equipment or machinery.

Model Articles: board recommendation and shareholder approval

Article 34 of the Model Articles for private companies limited by shares allows non-cash dividends to be declared, subject to shareholder approval by ordinary resolution on the recommendation of the directors.

These minutes record the directors’ recommendation and are intended to be used alongside the shareholders’ ordinary resolution relating to the dividend in specie.

Companies Act 2006: distributable reserves

As with cash dividends, dividends in specie can only be paid if the company complies with the Companies Act 2006 and has sufficient distributable reserves to support the payment of the dividend.

Company type

These board minutes are designed for use by a private limited company.

Board Minutes – approval of a dividend in specie is part of Corporate. Just £38.50 + VAT provides unlimited downloads from Corporate for 1 year.