Recommendation of Dividend in Specie Board Minutes

Board Minutes – approval of a dividend in specie

CO.DIVI.06

These Board Minutes can be used for the declaration of 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. 

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

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 board minutes document this recommendation and should be used in conjunction with the shareholders’ ordinary resolution also in this sub-folder.

As with cash dividends, dividends in specie can only be paid if companies comply with the provisions of the Companies Act 2006 and specifically have sufficient distributable reserves to support the payment of the dividend.

These board minutes are designed to be used by a private limited company.

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