Jurisdiction(s):
United Kingdom

Key definition

Shares definition

What does Shares mean? In company law practice, a share is a unit of a member’s interest in a company, carrying the rights and obligations attached to its class (for example, voting, dividends and return of capital on a winding up). The Companies Act 2006 simply states that a share is a share in a company’s share capital; the Irish Companies Act 2014 adopts a broadly equivalent approach. Usage and effect are consistent across England & Wales, Scotland, Northern Ireland and Ireland. A company’s share capital comprises the number of shares it allots and issues to investors on or after incorporation. Those...

UK share plans: template letter to option holders after a rights issue, adjusting option share numbers and exercise price, performance conditions, replacement certificates, FAQs, and HMRC tax treatment

Published by a LexisNexis Share Incentives expert

Precedents

[ insert name of option holder ]
[ insert address ]
[ insert postcode ]
[ insert date ]

Dear [ insert name of option holder ],

[ insert name of option plan ]: effect of recent rights issue on your option[s]

1 Introduction

On [ insert date ], [ insert name of company ] (the Company) invited all shareholders to take up additional Shares in the Company. Eligible shareholders could apply for [ insert number ] new shares for every [ insert number ] already held. The subscription price was [ insert currency and amount ] per new share, representing an approximate discount of [ insert currency and amount ] to the share price on [ insert date ]. [ Further information about the rights issue can be found in the enclosed copy of the document sent to shareholders. ]

2 Effect of the rights issue on your option

We are contacting you as you currently hold option(s) under the [ insert name of option plan ] (the Plan). This letter sets out the effect of the rights issue on your outstanding option(s)...

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Web page updated on 22/05/2026

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