Special resolution (member): disapplication of pre-emption rights (section 569): private companies

by Practical Law Corporate

A standard clause containing a special resolution for a private company with a single class of shares to generally disapply the statutory pre-emption rights. Under section 561 of the Companies Act 2006 (CA 2006), a company must first offer new equity securities to existing shareholders pro rata. This standard clause provides the necessary resolution text for directors to be empowered under section 569 of the CA 2006 to allot equity securities without adhering to the statutory pre-emption right. This standard clause is drafted for use by a private company that has not excluded or modified the statutory pre-emption rights in its articles of association and seeks a general disapplication rather than one for a specific allotment. It also addresses the procedural requirements, such as the need for a special resolution and subsequent filing with the Registrar of Companies. It contrasts this approach with alternatives available under sections 570 and 571 of the CA 2006.