Company Law Reform Bill [HL]

moved Amendment No. 413:"Page 257, line 9, leave out ““number”” and insert ““amount””" The noble Lord said: My Lords, Amendments Nos. 413 to 417 to Clause 540 are designed to deal with a point that was made during Grand Committee. This clause deals with the power of the directors to allot shares in public companies and private companies that will have more than one class of share after the proposed allotment. The concern is that, as currently drafted, an authority given under Clause 540, and any resolution renewing such an authority, must specify,"““the maximum number of shares””" that may be allotted pursuant to the authority. The noble Lord, Lord Razzall, pointed out in Grand Committee that that formulation of words does not take account of the fact that shares may be in different classes or of different denominations. The revised drafting is intended to address the noble Lord’s concerns. As noble Lords will see from these amendments, we have returned to the formulation of words used in Section 80 of the 1985 Act—that is, the ““maximum amount”” of shares—on which Clause 540 is based. This formulation would cover an authority limited to a specific number of shares, but would also cover an authority given to directors to grant shares up to a given maximum nominal amount. The current provision provides this flexibility and we would similarly not wish the Bill to be prescriptive about the form of the limit on the authority to allot shares—hence our reverting to the terminology used in current Section 80 with which companies and their advisers are no doubt familiar and comfortable. Amendments Nos. 418 and 419 to Clause 541 are consequential on the amendments to Clause 540. I trust that that deals with the noble Lord’s concerns. I am very grateful to him for raising this issue with us and to the Law Society for considering this point. I beg to move.