Statutory contract of company's constitution meaning

What is a company's constitution? This Practice Note sets out what is meant by a company’s constitution in detail. It focuses on the core element of that constitution: the articles of association. It reviews the statutory definition under the Companies Act 2006, outlines the character of the articles and distils the typical provisions found in a company’s articles. The Practice Note also addresses entrenched terms within the articles and the importance of the memorandum of association...

What is a company? A company is a distinct legal person, separate from its owners. Members own it, while directors run it day to day. Its framework is set by the Companies Act 2006 (CA 2006). As a business structure, it is widely adopted; more than 5 million companies are registered across the UK. The CA 2006 recognises several forms, including: Public or private companies limited by shares Private companies limited by guarantee (used chiefly by charities and other not-for-profit organisations—see Practice Note: Companies limited by guarantee) Unlimited companies (uncommon—see Practice Note: Unlimited companies) This Practice Note focuses on forming public or private companies limited by shares, as these are the predominant models. Why set up a company? A principal attraction of incorporation, compared with trading as a sole trader, a partnership or another vehicle, is the separate legal personality. The company can contract in its own name and bears responsibility for its own debts and liabilities...

Produced with input from Rebecca Cousin of Slaughter and May on market practice This Practice Note explores the step-by-step processes for effecting the purchase by a bidder (offeror) of all shares, or one or more share classes, in a target company (offeree) that it does not yet hold, using a scheme of arrangement under Part 26 of the Companies Act 2006 (CA 2006) (scheme). Distinct from a takeover offer, a scheme creates no contract between the offeror and the offeree’s shareholders. Rather, it is a statutory device employed to deliver various corporate transactions. In a takeover setting, the offeree proposes the scheme to its shareholders, or to the relevant class holders, and so the offeree’s board will generally need to participate and co-operate. A scheme has hallmark features, most notably the requirement for approval by offeree shareholders at a court-convened meeting and subsequent sanction by the court. For a discussion of what schemes of arrangement are, their structure and the principal statutory conditions, see Practice Note: Schemes of arrangement—nature...