Approving Annual Dividend (Shareholder Resolution)
This is a template ordinary resolution of the shareholders of a company in England and Wales to approve the annual dividend to its shareholders as recommended by the directors.
Shareholders are generally required to approve the declaration of a final (annual) dividend by ordinary resolution, unless the Articles specify otherwise. Directors may declare interim dividends on their own authority, but a final dividend must be approved by shareholders and cannot exceed the amount recommended by the directors.
Approval of Annual (Final) Dividend
IT IS RESOLVED THAT, as an ordinary resolution of the shareholders of the Company pursuant to the Companies Act 2006:
Declaration of dividend
A final dividend of £[final dividend amount in £] per [share class], amounting in aggregate to £[aggregate final dividend amount in £], be and is hereby declared for the financial year ended [applicable financial year end date], such dividend having been recommended by the directors.
Make sure to first pass a recommendation of the directors for the amount of dividend(s) proposed.
Record date and payment date
The dividend shall be payable on [payment date] to shareholders whose names appear on the register of members at the close of business on [record date].
Source of dividend
The dividend shall be paid out of the Company’s distributable profits in accordance with Part 23 of the Companies Act 2006.
Authority to implement
Any director or the Company Secretary be authorised to:
take all steps necessary to give effect to the payment of the dividend; and
do all acts and things which they consider necessary or desirable in connection with this resolution.
No Companies House filing is required for the resolution itself, but the dividend should be properly recorded in the Company’s statutory and accounting records.
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England & Wales note
This version is drafted for England & Wales. Scotland and Northern Ireland differ on some points — for example notice periods and tribunal procedure. Tell GitLaw where you hire and it adjusts the draft.
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