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Examples of WORDING's that will be accepted by CH for Prescribed Particulars

Article ID
ias-8561
Article Name
Examples of WORDING's that will be accepted by CH for Prescribed Particulars
Created Date
25th January 2010
Product
IRIS Company Formations
Problem
Can Companies House provide an EXAMPLE of the WORDING for the 'PRESCRIBED PARTICULARS' that will be ACCEPTABLE when forming a company?
Resolution
Yes, but this is limited to the simplest case of a private company limited by shares using the model articles provided in the Companies (Model Articles) Regulations 2008. Examples of the wording that could be used for voting rights, dividend rights or distributions on winding up are as follows: (a) “each share is entitled to one vote in any circumstances” – this wording will reflect the general legal position of one member one vote under section 284 Companies Act 2006; (b) “each share is entitled pari passu to dividend payments or any other distribution” – this will reflect a basic right to dividends but any dividend must be made in accordance with the Companies Act and the company’s articles of association; and (c) “each share is entitled pari passu to participate in a distribution arising from a winding up of the company” – any distribution from a company being wound up will therefore operate in accordance with the law. It is very unlikely that companies using the model articles will issue shares with capital distribution rights. Generic wording is therefore difficult to provide and companies with such shares are better placed to describe the rights attached. It is not possible to provide standard wording in relation to redeemable shares. The issue of such shares is at the discretion of a company. If redeemable shares are issued the directors may determine the terms, conditions and manner of redemption. The specific wording setting out the rights will be required. If there are any amendments made to the model articles to adapt them or resolutions passed detailing share rights of a company, the examples above may not adequately reflect the share rights that must be disclosed. If the rights information is not easily obtainable from the company’s articles of association or resolutions, you may want to seek professional advice. NOTE: Companies House will reject statements of capital in instances where full information is not provided or where reference is made to another document for the share rights information. Some examples of wording which will result in the statement of capital being rejected are: (a) ‘please see the Articles of Association for the rights’; (b) ‘rights as set out in the Articles’; (c) ‘share rights are the same as those already in issue’; (d) ‘not applicable’; (e) ‘pari passu’ IMPORTANT: From version 11, IRIS have updated the software to include validation of the wording for the Voting Rights that will be accepted by Companies House.

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