S. 570 Shareholders’ Special Resolution - Disapplication of Statutory Pre-Emption Rights

IN LIGHT OF THE ECONOMIC CRIME & CORPORATE TRANSPARENCY ACT 2023, THIS TEMPLATE IS CURRENTLY UNDER REVIEW. 

Under the Companies Act 2006, existing shareholders have the right to be offered shares pro rata to their existing shareholdings before any new shares are allotted (s.561 Companies Act 2006). This is called a pre-emption right. If the directors of a company are generally authorised to allot shares under section 551 of the Companies Act 2006, they may also be given the power to allot shares under that general authority as if the statutory pre-emption regime in section 561 of the Companies Act 2006 did not apply (section 570 Companies Act 2006). A section 570 resolution must be passed as a special resolution and sent to Companies House within 15 days. 

This template contains the wording required to give directors a general power to allot shares as if the pre-emption rights did not apply. It may be used in conjunction with our resolution to authorise an allotment of shares under section 551 of the Companies Act 2006 and passed at the same time. It will then expire when that general authority to allot expires. However, the power to disapply pre-emption rights can be renewed at the same time as the authority to allot shares is renewed. If you need any further advice on the disapplication of pre-emption rights, you should contact a solicitor.

Shareholders’ Special Resolutions require the votes of 75% of members present in person or by proxy, who are entitled to vote and do vote at the meeting. The meeting at which the resolution is proposed must have had at least 14 days notice, unless a shorter period was agreed by a majority in number of members holding at least 90% of the shares (95% in the case of public companies).

Alternatively, the written resolution procedure can be used, and the resolution will be passed if approved by shareholders representing 75% of the total voting rights of the shareholders entitled to vote on the written resolution on the day it is circulated.

This document sets out the required wording of the special resolution. If it is to be passed at a general meeting, it should be used in conjunction with “Shareholders’ resolutions – General Meeting Format”. If it is to be passed as a written resolution, it should be used in conjunction with “Shareholders’ Written Special Resolution”.

Optional phrases / clauses are enclosed in square brackets. These should be read carefully and selected so as to be compatible with one another. Unused options should be removed from the document.

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