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Legal Terms - class rights
Rights that are granted to an individual for the duration that he holds any shares, or that are attached to a specifically designated class of shares (preference *shares, for example). In the latter scenario, shareholders establish themselves as a distinct class. Class rights typically include the right to *dividends, the return of capital in the event of a *winding-up, or the appointment of directors to the board. Class rights can only be changed with the approval of the affected class (Companies Act 2006 s. 630) or in compliance with a provision in the company's constitutional papers. Affected class members who did not consent to the modification and who own at least 15% of the class's issued shares may file a 21-day notice of cancellation with the court (Companies Act 2006, s. 633).
Rights that are granted to an individual for the duration that he holds any shares, or that are attached to a specifically designated class of shares (preference *shares, for example). In the latter scenario, shareholders establish themselves as a distinct class. Class rights typically include the right to *dividends, the return of capital in the event of a *winding-up, or the appointment of directors to the board. Class rights can only be changed with the approval of the affected class (Companies Act 2006 s. 630) or in compliance with a provision in the company's constitutional papers. Affected class members who did not consent to the modification and who own at least 15% of the class's issued shares may file a 21-day notice of cancellation with the court (Companies Act 2006, s. 633).
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