Part 23Company distributions
Chapter 2Matters which are distributions
Distributions in respect of special securities
1015Meaning of “special securities”
1
Securities of a company are special securities for the purposes of paragraph F in section 1000(1) if they meet any of conditions A to E.
2
Condition A is that the securities are issued as described in paragraph D in section 1000(1) (securities issued otherwise than for new consideration).
3
Condition B is that—
a
the securities—
i
are convertible (directly or indirectly) into shares in the company, or
ii
carry a right to receive shares in or securities of the company, and
b
the securities are neither listed on a recognised stock exchange nor issued on terms which are reasonably comparable with the terms of issue of securities listed on a recognised stock exchange.
4
Condition C is that under the securities the consideration given by the company for the use of the principal secured depends (to any extent) on the results of—
a
the company's business, or
b
any part of the company's business.
5
Condition D is that the securities are connected with shares in the company (see section 1017(2)).
6
Condition E is that the securities are equity notes—
a
issued by the company (“the issuing company”), and
b
held by a company which—
i
is associated with the issuing company, or
ii
is a funded company (see section 1017(3)).