S.561 - Pre-emption Rights – Shareholders has the first rights of refusal of issue.
S.567 - Pre-emption Rights can be excluded by provision in the Articles.
S.596 - Special Resolution can exclude pre-emption rights on one-off basis
S.859A–Company register charges (ensure its security in the event of a company’s liquidation).
S.1163 - A substantial non-cash asset is any property or interest in property, other than cash.
Model Articles:
The Model Articles of Association is a legal document containing standard default provisions that
regulate how company is run.
Articles 3 – Directors' General Authority – Manage the Company
Articles 11(2) - Quorum for directors’ meetings – no less than two and unless otherwise fixed it is two.
Articles 13- Casting Vote
Article 14 - Conflicts of Interest
Articles 17(1) - Method by ordinary resolution (more than 50%) or decision of the directors
Article 26 – Shares Transfers – up todirectors to accept the shares and then enter their names into the
register of members.
Forms/Documents:
Form AP01 – In accordance with SS.167 and 167(D) CA 2006, this form is used to appoint an individual
as a director – 14 days limit – signed by director
Form AD01 – This form is used to change a company’s registered office address – 14 days limit – signed
by director
Form AA01– In accordance with S.392 CA 2006, this form is used to change the Accounting Reference
Date – timescale not specified – signed by director
Certificate of Incorporation – confirms that a company legally exists and shows a company’s number
and date of information | Fee Cost: £15 for standard service
Form INO1 – In accordance with S.9 of CA 2006, this for is used for application to register a company
Form NM01 – Change of Company’s Name – 15 days limit – signed by director
Form SH01 – Issue of New Shares – 30 days limit – signed by director
Form PSC04 – Change of details of individual with significant control – signed by director
Form PSC07–Notice of ceasing to be a person with significant control – signed by directors
Form TM01– Form for a director to resign – 14 days limit – signed by director
Stock Transfer Form – Transfer shares from one person to another.
,Importance of Company:
Separate Legal Entity (a company has the same rights in law as a person)
- Enter Contracts | Sue and be Sued | Own Property
Limited Liability
- Only lose the shares invested, your personal assets will be safe
- Personal Guarantee is an official commitment to a lender to repay an outstanding loan if the
company cannot afford to pay. If business fails to make its debt payments, then that individual
can be responsible for paying back the loan with personal assets.
Formation of Company:
Under S.7(1) a Company is formed by one or more persons, subscribing their names to a memorandum
of association (S.8) and complying with the requirements of this Act as to registration (SS. 9 to 13).
A company cannot be formed for an unlawful purpose (S.7(2)).
Memorandum of Association is a memorandum which states that subscribers is wishing to form a
company and agree to become members of the company. The memorandum must be in prescribed
form and must be authenticated by each subscriber (S.8).
Memorandum of Association must be delivered to registrar together with application for registration of
the company. The application of registration must state:
- Company’s proposed name
- Where the company’s registered office is situated in
- Whether liability of members of the company is limited, and if so, whether it’s limited by shares
or by guarantee
- Whether company is private or a public company
- Statement of intended address of company’s registered office
- Copy of proposed Articles of Association
- Statement on type of company and its business activities
Statement of Compliance (S.13) is required to be delivered to the registrar. This is a statement that the
requirements of this Act in relation to registration has been complied with.
If registrar is satisfied that the requirements of this Act are complied with, he shall then register the
documents delivered to him.
On the registration of a company, the registrar of companies shall issue a Certificate of Incorporation.
This states:
- Name and registered number of company
- Date of its incorporation
- Whether its limited or unlimited company, and if limited, then whether its limited by shares or
limited by guarantee
- Whether its private or public company
, - Where the company’s registered office is located in
The certificate must be signed by registrar or by authenticated by registrar’s official seal.
After the registration of the company, the subscribers to the memorandum, together with other persons
as may from time to time become members of the company, are a body corporate by the name stated in
the certificate of incorporation. From this the body corporate will be capable of exercising all functions
of an incorporated company.
Shareholders:
Shareholders = Members
They own the company by owning its shares.
Principal procedures to pass Shareholder resolutions -
- General Meeting – pass or make decisions
- Written Resolution – written form that they sign
*SHAREHOLDERS DO NOT PASS WRITTEN RESOLUTION AT A GENERAL MEETING!!!
To pass a company resolution which may be ordinary or special, shareholders must cast their votes for
or against a proposed course of action, which is done at General Meeting or Written Resolution.
Principal types of Shareholder resolutions -
- Ordinary Resolution (passed by a simple majority – 51%) - S.282 CA 2006
- Special Resolution (passed by a 75% majority) - S.283 CA 2006)
*DIRECTORS NEVER PASS ORDINARY RESOLUTION OR SPECIAL RESOLUTION!!!
Procedures in relation to a Company:
Change Directors (Control of Company):
- Directors hold these powers.
- First accept the resignation of existing directors (Form TM01) (if applicable) and then appoint
new directors.
- S.168 CA 2006–Directors can be removed by an ordinary resolution at a meeting before the
expiration of his period of office, notwithstanding anything in any agreement between it and
him.Special Notice is required of resolution to remove director under this section or to appoint
somebody instead of a director so removed at the meeting at which he is removed.
- Model Articles 17 – appointed as a director by ordinary resolution or decision of the directors.
- Form AP01 – within 14 days update Register of Directors and then notify Companies House.
- A director can be terminated by provisions of CA 2006 or is prohibited by law through
bankruptcy order | creditor’s debts made against that person | registered medical practitioner
treats that person and provides written opinion to the company that the person is
physically/mentally incapable of acting as director for more than 3 months | director is
resigning, and his resignation has taken effect.
S.567 - Pre-emption Rights can be excluded by provision in the Articles.
S.596 - Special Resolution can exclude pre-emption rights on one-off basis
S.859A–Company register charges (ensure its security in the event of a company’s liquidation).
S.1163 - A substantial non-cash asset is any property or interest in property, other than cash.
Model Articles:
The Model Articles of Association is a legal document containing standard default provisions that
regulate how company is run.
Articles 3 – Directors' General Authority – Manage the Company
Articles 11(2) - Quorum for directors’ meetings – no less than two and unless otherwise fixed it is two.
Articles 13- Casting Vote
Article 14 - Conflicts of Interest
Articles 17(1) - Method by ordinary resolution (more than 50%) or decision of the directors
Article 26 – Shares Transfers – up todirectors to accept the shares and then enter their names into the
register of members.
Forms/Documents:
Form AP01 – In accordance with SS.167 and 167(D) CA 2006, this form is used to appoint an individual
as a director – 14 days limit – signed by director
Form AD01 – This form is used to change a company’s registered office address – 14 days limit – signed
by director
Form AA01– In accordance with S.392 CA 2006, this form is used to change the Accounting Reference
Date – timescale not specified – signed by director
Certificate of Incorporation – confirms that a company legally exists and shows a company’s number
and date of information | Fee Cost: £15 for standard service
Form INO1 – In accordance with S.9 of CA 2006, this for is used for application to register a company
Form NM01 – Change of Company’s Name – 15 days limit – signed by director
Form SH01 – Issue of New Shares – 30 days limit – signed by director
Form PSC04 – Change of details of individual with significant control – signed by director
Form PSC07–Notice of ceasing to be a person with significant control – signed by directors
Form TM01– Form for a director to resign – 14 days limit – signed by director
Stock Transfer Form – Transfer shares from one person to another.
,Importance of Company:
Separate Legal Entity (a company has the same rights in law as a person)
- Enter Contracts | Sue and be Sued | Own Property
Limited Liability
- Only lose the shares invested, your personal assets will be safe
- Personal Guarantee is an official commitment to a lender to repay an outstanding loan if the
company cannot afford to pay. If business fails to make its debt payments, then that individual
can be responsible for paying back the loan with personal assets.
Formation of Company:
Under S.7(1) a Company is formed by one or more persons, subscribing their names to a memorandum
of association (S.8) and complying with the requirements of this Act as to registration (SS. 9 to 13).
A company cannot be formed for an unlawful purpose (S.7(2)).
Memorandum of Association is a memorandum which states that subscribers is wishing to form a
company and agree to become members of the company. The memorandum must be in prescribed
form and must be authenticated by each subscriber (S.8).
Memorandum of Association must be delivered to registrar together with application for registration of
the company. The application of registration must state:
- Company’s proposed name
- Where the company’s registered office is situated in
- Whether liability of members of the company is limited, and if so, whether it’s limited by shares
or by guarantee
- Whether company is private or a public company
- Statement of intended address of company’s registered office
- Copy of proposed Articles of Association
- Statement on type of company and its business activities
Statement of Compliance (S.13) is required to be delivered to the registrar. This is a statement that the
requirements of this Act in relation to registration has been complied with.
If registrar is satisfied that the requirements of this Act are complied with, he shall then register the
documents delivered to him.
On the registration of a company, the registrar of companies shall issue a Certificate of Incorporation.
This states:
- Name and registered number of company
- Date of its incorporation
- Whether its limited or unlimited company, and if limited, then whether its limited by shares or
limited by guarantee
- Whether its private or public company
, - Where the company’s registered office is located in
The certificate must be signed by registrar or by authenticated by registrar’s official seal.
After the registration of the company, the subscribers to the memorandum, together with other persons
as may from time to time become members of the company, are a body corporate by the name stated in
the certificate of incorporation. From this the body corporate will be capable of exercising all functions
of an incorporated company.
Shareholders:
Shareholders = Members
They own the company by owning its shares.
Principal procedures to pass Shareholder resolutions -
- General Meeting – pass or make decisions
- Written Resolution – written form that they sign
*SHAREHOLDERS DO NOT PASS WRITTEN RESOLUTION AT A GENERAL MEETING!!!
To pass a company resolution which may be ordinary or special, shareholders must cast their votes for
or against a proposed course of action, which is done at General Meeting or Written Resolution.
Principal types of Shareholder resolutions -
- Ordinary Resolution (passed by a simple majority – 51%) - S.282 CA 2006
- Special Resolution (passed by a 75% majority) - S.283 CA 2006)
*DIRECTORS NEVER PASS ORDINARY RESOLUTION OR SPECIAL RESOLUTION!!!
Procedures in relation to a Company:
Change Directors (Control of Company):
- Directors hold these powers.
- First accept the resignation of existing directors (Form TM01) (if applicable) and then appoint
new directors.
- S.168 CA 2006–Directors can be removed by an ordinary resolution at a meeting before the
expiration of his period of office, notwithstanding anything in any agreement between it and
him.Special Notice is required of resolution to remove director under this section or to appoint
somebody instead of a director so removed at the meeting at which he is removed.
- Model Articles 17 – appointed as a director by ordinary resolution or decision of the directors.
- Form AP01 – within 14 days update Register of Directors and then notify Companies House.
- A director can be terminated by provisions of CA 2006 or is prohibited by law through
bankruptcy order | creditor’s debts made against that person | registered medical practitioner
treats that person and provides written opinion to the company that the person is
physically/mentally incapable of acting as director for more than 3 months | director is
resigning, and his resignation has taken effect.
