Revised Articles of Association following share reclassification
These Articles of Association may be adopted by a company following a reclassification of its shares and a variation of the rights attaching to the newly reclassified shares.
The adoption of new articles must only be made in accordance with company law rules and there are protections against changes that increase the liability of individual shareholders, vary the rights of any class of shareholders or otherwise prejudice minority shareholders. However provided the correct procedural steps are followed to reclassify a company’s shares (see our Guidance Note – reclassifying shares & class consents ), new articles of association will need to be adopted in order to incorporate the rights of the newly reclassified shares.
These Articles of Association provide for two new classes of shares, A & B shares, and provide for the transition from a single shareholding group to two new classes or groups of shares. The articles are based on our Modified Model Articles (Private Company Limited By Shares). As well as including all the standard articles you would expect in articles of association, these articles provide for:
• A & B shareholders;
• A & B directors;
• The appointment and removal of A & B directors;
• Variation of class rights;
• Pre-emption rights on the issue of new shares;
• Payment of dividends and other distributions for two shareholding groups;
• Decision making by shareholders for two shareholding groups;
• Voting rights for two shareholding groups;
• Quorums for meetings;
• Class meetings; and
• Written resolutions for two shareholding groups.
If there are any specific rights relating to a class of shares that a company wishes to include, these can be drafted into the articles (note however the consequential changes this may trigger in other clauses within the articles of association).
These articles are in open format. The requisite details should be inserted into the highlighted fields or the wording can be adjusted to suit your purposes. Wording in square brackets is optional. If it is required, then the brackets should be deleted and the wording within them retained. If the wording is not required, then it can be deleted.
Once you have subscribed to the appropriate document folder click on the “Download Document” button below. You will be asked what you want to do with the file. It is recommended that you save the document to a location of your choice prior to viewing.
Revised Articles of Association following share reclassification is part of Corporate Documents. Just £35.00 + VAT provides unlimited downloads from Corporate Documents for 1 year.