Fact pattern

Wildheart Limited (“Wildheart”) has three directors, each of whom owns 1,000 ordinary shares of £1 each in Wildheart. (There are no other shareholders in Wildheart.) Wildheart was incorporated in November 2009 and has the Model Articles for Private Companies as its articles. The board of Wildheart has decided that Tracy Jones (“TJ”) should be introduced as a new investor. TJ will take 1,000 ordinary shares of £1 each and pay a total of £50,000 cash for her investment. She will also be appointed to the board as a director.

(1) Under the Companies Act 1985, all companies were required to have an authorised share capital. This is no longer the case under the 2006 Act.

(2) All shares issued by a company must have a nominal value, but this value may not equate to the value actually paid for them – see para 11.2.3.