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New issue of Class B share

Hello, I'm a little rusty having been away from practice for three or four years.

Company director wishes to issue a share to new shareholder.  Director does not take a dividend but wishes new shareholder to take a dividend.  My suggestion would be to issue a new share then vary it so it's a Class B share.  I think we have to vary the director's as well, to become Class A shares.  I have been searching around in my Company Law book and Companies House for what needs to be done but would appreciate if someone with recent experience could throw in their thoughts..

1. Issue a share certificate to new shareholder

2. Make entry in comapny register to allot new share

3.Notify Companies House on SH08 to change the class.

Do we need to hold an EGM?

Do we need to do anything else?

Many thanks!

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19th Feb 2012 09:58

Briefly ...

You need to:

pass a special resolution of the members to amend the Articles to have two types of ordinary shares ranking pari passu except that different dividends may be paid.file the resolution and amended Articles at Companies House.pass another resolution (I think it may need to be only an ordinary one, but pass it as a special resolution to be safe) to recategorise the existing issued share(s) as A Ordinary and to issue B Ordinary share(s).record in Register of Members and issue share certificates signed by director and a witness.

Resolutions can be passed as written resolutions.  No need to hold a GM.

Thanks (2)
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By dinamic
24th Feb 2012 13:31

Thanks for your reply!

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By BKD
24th Feb 2012 14:09

I know you didn't ask about tax

But what is new shareholder's relationship with the company? In particular, why is he/she going to receive dividends but not the existing shareholder?

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