New Clause 189

Company Law Reform Bill [Lords] – in a Public Bill Committee at 1:45 pm on 20th July 2006.

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Terms and manner of redemption

‘(1) The directors of a limited company may determine the terms, conditions and manner of redemption of shares if they are authorised to do so—

(a) by the company’s articles, or

(b) by a resolution of the company.

(2) A resolution under subsection (1)(b) may be an ordinary resolution, even though it amends the company’s articles.

(3) Where the directors are authorised under subsection (1) to determine the terms, conditions and manner of redemption of shares—

(a) they must do so before the shares are allotted, and

(b) any obligation of the company to state in a statement of capital the rights attached to the shares extends to the terms, conditions and manner of redemption.

(4) Where the directors are not so authorised, the terms, conditions and manner of redemption of any redeemable shares must be stated in the company’s articles.’.—[Margaret Hodge.]

Brought up, and added to the Bill.