Articles of Association: limited company (ltd) by shares
This document is provides the articles of association for a limited liability trading company that has a simple management and ownership structure. It provides a reasonable, practical framework to enable the directors to carry out their duties, while protecting shareholders who are not directors.
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- Guidance notes included
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About this document
These articles of association are for a private limited company with a simple share structure.
The company may have any number of shareholders, whether two or twenty. Not all will be directors, so the document provides a balance between letting those that are get on with operating the business successfully on the one hand, while protecting the interest of every owner on the other.
It is, of course, also suitable for a company all shareholders are directors.
This document can be used to replace the default model articles provided by Companies House that your company most likely used when it was formed, or to replace those of an older company whose management structure has changed.
For this document, the nature of the business carried on by the company could be anything, from online retail of products to building construction services.
Why you should adapt the articles to reflect how your company operates
A company’s articles of association provide the framework under which shareholders make strategic decisions and directors operate the business on a day to day basis. They are the legal constitution.
That is different for every business – even competitors in the same industry. Another business may be happy to pass every motion at a board meeting with only a majority of hands. You may wish for certain decisions to have unanimous agreement.
The framework provided here is, of course, based on the model articles provided in the Companies Act 2006. However, despite the name, the model articles are anything but suitable for every business. There are many additions and omissions that are unworkable or impractical in the real world.
However, by introducing the model set and other provisions, the CA 2006 did free shareholders and directors from the longstanding straightjacket of a document few people dared to edit (known as Table A). Because you can now edit the articles more flexibly, you can make just the structure your company needs.
We have taken advantage of that flexibility in this document to give you a version that is simple and effective - and in plain English of course.
As with all Net Lawman documents, the drafting notes give you comments and suggestions on every paragraph.
The law requires that minutes of meetings are kept, so for your convenience, we also include draft minutes of directors' and members' general meetings required in order to change the articles.
The document deals with more issues than would be needed by a one man company or a newly incorporated start-up. For those circumstances, we offer this set as an alternative.
Use of a shareholders’ agreement
Although the articles of association can be changed at any time, doing so requires the consent of at least 75% of the shareholders.
To avoid having to change them frequently, it is sensible to draw them in ways that suit how your company might be operated in the next few years, not just what you minimally need today.
Within that framework, you need to set the rules for the detailed relationships between directors and shareholders. You will want to be able to leave your articles alone but still change who does what when someone wants to sell his shares or a new director is appointed. All of that detailed control is best exercised through a shareholders' agreement.
This document was written by a solicitor for Net Lawman. It complies with current English law.
What other customers thought
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By JEAN SOUTHWORTH 04 October 2014
I had lost our copy of Memorandum and Articles of Association and wanted to find a copy on the Internet. I was unaware that I could have got the info free on the Government site. However. I found your extra comments very interesting and helpful in understanding everything. My Grandson is doing business studies and it will be helpful to him also. I don't regret having to pay.
By Soni Singh 28 February 2014
Excellent service; fast and efficient. The document I purchased was well annotated and written at a high standard.
By Vernon Riley 11 August 2014
I wanted to understand the impact of the many layers within the articles of association; and to make a few well judged adjustments so a Net Lawman document was just what I needed.The document had good clear explanations of the options available. And I got a good fast response when a query was raised about a particular paragraph.I'd recommend Net Lawman to others wanting to understand what the document will do for them.
By Urich Wilmot HOYTE 01 March 2014
When I contacted Net Lawman, I had absolutely no idea what to expect. I was searching for a guide or sample Articles and Memorandum and the search returned the UK site. The documents are quite comprehensive and appear to have exceeded my expectations. I am reserving them for when needed. In the meanwhile, it should be appreciated if you would provide additional enlightenment on the Memorandum of Association. Your version excluded the objects clause in which I was particularly interested. This suggests that that is no longer necessary or needed. Therefore the company is free to engage in any legitimate business under the sun. Please advise.
I will rate the package 4.75/5.
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