Capital redemption reserve meaning

Share buybacks (purchase of own shares) A limited company can repurchase its own shares, provided the conditions in the Companies Act 2006 (CA 2006) are satisfied. This is commonly described as a share buyback or a purchase of own shares. Alongside CA 2006, other regimes are relevant where the company is listed or on AIM. In particular, a listed company must consider the Listing Rules (LRs) and the Disclosure Guidance and Transparency Rules (DTRs). An AIM company must consider the AIM Rules for Companies (AIM Rules); however, those rules do not expressly address share buybacks, and AIM Regulation has confirmed that, in most situations, an AIM company following the LRs for buybacks would be regarded as best practice. An AIM company is also subject to DTR 5. In addition, both listed and AIM companies may follow guidance issued by institutional investors. The CA 2006 restrictions applicable to share buybacks do not extend to unlimited companies. For further information on this type of company, see Practice Note: Unlimited companies...

STOP PRESS: The UK listing framework underwent a major overhaul on 29 July 2024, removing the premium and standard segments and introducing a single listing category for equity shares in commercial companies. This commercial companies category is strongly disclosure-led and sits alongside other listing categories, such as shell companies, secondary listing and closed-ended investment fund categories. A new UK Listing Rules sourcebook took effect to implement these changes, and the previous sourcebook was revoked. For further information, see Practice Note: Reform of the UK listing regime—fundamentals. This Practice Note reflects the regime as it stood prior to 29 July 2024. A limited company planning to redeem redeemable shares must comply with the Companies Act 2006 (CA 2006). In addition to CA 2006, other rules and guidance are relevant to a listed company or an AIM company. In particular, a listed company must have regard to the Listing Rules (LRs) and the Disclosure Guidance and Transparency Rules (DTRs). An AIM company must have regard to the AIM Rules for Companies...

Coronavirus (COVID-19): In light of the coronavirus (COVID-19) outbreak, certain Companies House filings and associated administrative processes have been temporarily paused or altered. These temporary changes apply to filing requirements and administrative steps. For more on the effects of COVID-19, see Practice Note: Coronavirus (COVID–19)—impact on company filing and administrative procedures [Archived]. A limited company planning to undertake a redemption of redeemable shares must observe the requirements of the Companies Act 2006 (CA 2006). Alongside CA 2006, additional rules and guidance are pertinent to a listed company or an AIM company (for further details, refer to our Practice Notes on public company redemptions of shares). Further guidance is available in our related Practice Notes. For analysis of the legal obligations a company must satisfy to issue redeemable shares, and the reasons a company might redeem its shares, see Practice Note: Issue of redeemable shares. What is the effect of redeeming shares?...

Index to the articles Part 1: Interpretation and limitation of liability — defines the expressions used throughout and confirms members’ liability is limited to any unpaid amount on their shares Part 2: Directors — covers directors’ authority, shareholders’ reserve powers, delegation and committees; collective and unanimous decisions, meetings, participation, quorum, chairing, casting vote, conflicts, records and procedural rules; appointment and termination, remuneration and expenses Part 3: Shares and distributions — requires shares to be fully paid; permits varied classes and redemption; recognises only absolute ownership; sets out certificates, replacements, transfers and transmission; explains declaring and paying dividends, no interest, unclaimed sums, non-cash distributions, waivers, and capitalisation of profits Part 4: Decision-making by shareholders — provides for speaking and voting at general meetings, quorum, chairing, attendance by directors and others, and adjournment; voting on a show of hands or by poll, handling of errors, proxy content and delivery, and allowable amendments Part 5: Administrative arrangements — permitted means of communication, use of company seals,...

Add the following new definitions in Article 2.1: Accounts • means, for each financial year of the Company, the audited [ consolidated ] balance sheet together with the profit and loss accounts of the Company and its subsidiary undertakings, prepared on the historical cost basis and in line with generally accepted accounting principles and all applicable accounting standards, Statements of Standard Accounting Practice, Financial Reporting Standards and Statements of Recommended Practice; After Tax Profit • means the amount of the profit [ (including any unrealised profits) ] of the Group for the relevant financial year (as shown by the Accounts): (a) before any provision or reserve has been made for or in respect of: i the payment of any dividend or other distribution on or in respect of any Shares or the transfer of any sum to reserves; ii the redemption of the [ Preferred Shares OR Loan Notes ]; and iii the amortisation or write-off of goodwill arising on consolidation; and (b) after provision has...

Index to the articles An overview of the company’s constitutional framework, setting out meanings of key terms, the extent of members’ liability, how directors exercise and delegate powers, procedures for board and member decisions, rules on share capital, dividends and other distributions, and ancillary provisions on communications, records, seals, and protections for directors... Part 1: Interpretation and limitation of liability – definitions and the limit of members’ liability. Part 2: Directors – general authority, members’ reserve power, delegation, committees, meetings, quorum, chairing, voting, casting votes, conflicts, written resolutions, further rules, appointment, rotation, termination, remuneration, expenses, and alternate directors. Part 3: Decision-making by members – calling, attendance and speaking, quorum, chairing, adjournment, voting, errors and disputes, polls, proxy content and delivery, amendments, restrictions, and class meetings. Part 4: Shares and distributions – classes and redemption, commissions, interests, certificates, uncertificated holdings, share warrants, liens and enforcement, calls and consequences, forfeiture and surrender, transfers and transmission, consolidation, declaring and calculating dividends, payment methods, deductions, no interest,...