ACCA · Question 15 · Corporate and Business Law
SolarWind Ltd is a private company with only one class of ordinary shares. The directors wish to allot new ordinary shares to raise capital for a new solar farm project. The company's articles do not contain any specific restrictions on allotment. Do the directors need prior authorization from the shareholders to allot these shares?
Answer options:
Yes, they must obtain an ordinary resolution from the shareholders.
Yes, they must obtain a special resolution from the shareholders.
No, directors of a private company with only one class of shares have automatic authority to allot shares of that class, unless the articles state otherwise.
No, directors always have unlimited power to allot shares in any type of company.
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