If you are looking to expand your business or do something “out of the ordinary”, now may be the time to consider reviewing your articles of association. Have you got the necessary powers? For instance, do you intend that the company buy back shares from retiring employees or allot new shares to potential investors?
You could also take this opportunity to consider if recent changes to the law could provide the company with greater freedom. For example, your articles might state that a company secretary is required. However, the default position is that this is no longer the case for private companies. You could also enable electronic communications with the company’s members and reduce notice periods for private company shareholder meetings from 21 days to 14.
In addition to providing further powers, this is a great opportunity to “clean up” the articles. You can remove any references to old laws, making the analysis of the articles easier in future.
If you are restructuring and the company is to become part of a group then you may also need to consider aligning the new articles with that of the parent company. This might introduce directors’ conflicts of interest or duties. These can be authorised to an extent within the articles, although extreme care should be taken.
The key is to consider what is important to the company now and what you are planning for the future. How can the articles help you to achieve that? If you are unsure how to accomplish the desired outcomes please feel free to contact Alan Stalker on 01383 721621.
Alan Stalker: email@example.com
Kelly Craig: firstname.lastname@example.org
Angus McGuire: email@example.com
Steven Wicks: firstname.lastname@example.org