Own Share Purchase Out of Capital – Board Resolutions (ESS version of Special Resolution)

Companies may wish to “buy back” or purchase their own shares.

Use these board resolutions for an ESS buyback out of capital

These Own Share Purchase (Capital) Board Resolutions (ESS version of Special Resolution) are for a private company wishing to purchase its own shares using capital where the purchase is for the purposes of an employees’ share scheme.

The document should be read in conjunction with “Own Share Purchase out of Capital - Guidance Notes.”

How the resolutions may be adapted for the company’s circumstances

• If the company has only one director, then paragraphs 1 to 3 and paragraph 9 can be deleted, together with references to “the chairman”.
• Any references to the “Company Secretary” should be deleted if the company does not have one, and replaced with the name of the director responsible for secretarial duties.
• Paragraphs 5(b), 5(c), 6(c), 6(d), 7(a), 7(b) and 8(a) should be amended depending on whether a written resolution or a general meeting is to be used to pass the special resolutions, and they must be consistent with each other.

Legal updates reflected

These Board Resolutions reflect the April 2013 changes to the Companies Act 2006, including the move from special resolution to ordinary resolution for approval of the purchase, and the introduction of a simpler procedure for approving the use of capital where the purchase is for the purposes of an employees’ share scheme.

In addition, they have been updated following the July 2021 introduction by HMRC of mandatory electronic stamp duty processes to replace their previous physical stamping system.

Own Share Purchase Out of Capital – Board Resolutions (ESS version of Special Resolution) is part of Corporate. Just £38.50 + VAT provides unlimited downloads from Corporate for 1 year.