LESSON 29. S.P.A.: STATUTORY MODIFICATIONS. THE LIMITED COMPANY WITH…
LESSON 29. S.P.A.: STATUTORY MODIFICATIONS. THE LIMITED COMPANY WITH SHARES
Procedure, publicity and effects of statutory amendments.
The majority principle
qualified majority of the parties.
The exceptions to the competence of the extraordinary assembly
--> the extraordinary meeting may delegate to the directros
a) by art.2365, paragraph 2.
by art. 2505 and 2505-bis,
the establishment or suppression of secondary offices;
the indication of which directors represent the company
the reduction of the capital in the event of the shareholder withdrawing,
the adaptation of the statute to regulatory provisions,
transfer of the registered office within the national territory.
b) article 2420-ter and 2443
grant the directors the
right to issue convertible bonds one or more times
or to increase the capital
Article 2446, paragraph 3).
in the same case, if the shares
have not nominal value,
the statute of association or a shareholders meeting resolution adopted with the majority required for the extraordinary shareholders' meeting
may assign the competence to the board of directors
c) Article 2446, paragraph 2
approve the mandatory reduction for significant losses of the share capital
The procedural process
The resolution to amend the bylaws, whether by the shareholders' meeting or by another body, must always be minuted by a notary
Article 2436, paragraph 1
With regard to amendments to the bylaws the notarial control is of a successive type
The effects of the modification
The resolution to amend the bylaws produces its effects only after registration (Article 2436, paragraph 5).
The right of withdrawal
The majority method ensures that the shareholders' meeting resolutions taken in compliance with the law and the deed of association are binding on all shareholders, even if they have not attended or dissenting (Article 2377, paragraph 1). It is a rule that also applies to resolutions that modify the statute, whatever the body that provides
Legal Cause derogable art. 2437, paragraph 2
Legal Cause non-derogable - Art. 2437, paragraph 1
(is not possible to exclude it with the bylaws)
art. 2437 - quinquies
(art. 2437, paragraph 3)
(art. 2355-bis, paragraph 2
only in the closed s.p.a. the statute can provide other causes for termination
(art. 2437, paragraph 4).
The legitimacy for the exercise of the retraction corresponds as a general rule to the
shareholders who have not participated with their vote in favor of the deliberations
possibility of not liquidating, but reducing, the investment
registered letter sent within 15 days of the registration of the Companies Registry of the Decision which legitimises it
the instrument of incorporation may provide that termination may not be exercised in the first year of the life of the society
the shares for which the right of withdrawal is exercised cannot be transferred and must be deposited at the registered office (art. 2437 - bis, paragraph 2).
Liquidation of Shares
The liquidation value
(art. 2437 - ter, paragraphs 1 and 2
the bylaw may provide different (art. 2437-ter, paragraph 4
15 days before (art. 2437-ter, paragraph 5).
Contastation of the liquidation value
(art. 2437-ter, paragraph 6).
The liquidation process
a) Shareholder Options
the directors must offer the shares of the receding shareholder to the other shareholders
Those who exercise the option, provided that they do so at the same time as they request it, have the right of priority in the purchase of shares that have remained unexposed (art. 2437-quater, paragraph 3)
b) Placement with third parties
In the event that shareholders do not acquire all or part of the shares of the clients, the directors may
place them in a third party
; in the case of shares traded on a regulated market, the placement is made by tender on that market (art. 2437 quater, paragraph 4).
c) Intervention of the company
If it is not possible to place the shares in the shareholders or in third parties, the
intervention of the society becomes necessary
and therefore affects its assets (art. 2437-quater, comme 5)
c1) the company has sufficient
it must acquire the shares, even on an exceptional basis in accordance with (Art. 2357, paragraph 3)
c2) The reducution of the capital
Otherwise letter c1 , the directors must convene the extraordinary assembly to deliberate on the reduction of the share capital (or to deliberate directly if the statutes give it the relevant competence according to art. 2365, paragraph 2) or the dissolution of the society
result in an increase or reduction in the company's equity
do not affect the company's equity or because they are limited to a different allocation of the shareholders' equity items (nominal increase or free capital) or because they are caused by an asset loss that has already occurred
The capital increases
The competence to increase the share capital
lies with the extraordinary shareholders' meeting
as an amendment to the articles of association
the by laws may grant the directors the power to increase the capital
Free capital increase or nomial increase
the essence of the free increase consists in subjecting to the maximum constraint of unavailability (that of the capital) a part of the net equity, previously available by the shareholders
From the point of view of the shares
the free increase can take place:
a) through the issue of new shares, which must have the same characteristics of those must be assigned free of charge to the shareholders in proportion to their ownership
b) by increasing the par value of the shares in circulation (Article 2442, paragraphs 2 and 3).
Free increase in favor of staff
(art. 2349, paragraph 1)
The paid increase
The paid-in capital increase is carried out by issuing new shares against contributions from shareholders or third parties
The increase cannot be made until the previously issued shares are fully paid up; In the event of noncompliance, without prejudice to the obligations assumed with the subscription of the issued shares, the administrators are jointly and severally liable for damages caused to shareholders and third parties (art. 2438).
Whoever subscribes the new shares must simultaneously make the contribution to the same extent
provided in the constitution of the company. And thus:
a) at least 25% of the nominal value of the subscribed shares in the case of cash contributions to a multi-member public limited company;
b) in its entirely in the case of cash contributions to a s.p.a. sole proprietorship or, in any case, when the granting is of goods or credits. If there is a surcharge, it must be paid in full at the time of subscription (article 2439, paragraph 1).
Rights of options
shareholders (and holders of convertible bonds who, potentially, are also shareholders) have the right to offer the new shares (or convertible bonds) as options in proportion to the number of shares owned (or according to the exchange ratio) (article 2441, paragraph 1).
Right of pre-emption
The right of pre-emption, according to Italian law, is the right of one and the same person to be preferred over another on equal terms in the constitution of a legal transaction.
Exemption and limitation of the right of option
a) is excluded when the new shares must be paid up by means of
contributions in kind.
t can be excluded, by statutory provisio
n, in companies with listed shares provided that:
. 1) wi
thin the limits of 10%
of the pre-existing share capital;
. 2) provided that the
issue price corresponds to the market value
of the shares and this is confirmed in a specific report by a statutory auditor or a statutory auditing company (Article 2441, paragraph 4).
c) can be excluded or limited when the company's interest requires it (Article 2441, paragraph 5).
It is for this reason that, in the event of a limitation or exclusion of the option right, the issue price of the shares must be established based on the value of the net assets, considering, for the shares, prices in the last six months.
The right of option and delegation to directors
If the increase is delegated to the directors art. 2441, paragraph 6, must be applied insofar as it is compatible. This means that:
a) the directors must illustrate to the shareholders' meeting the proposal to delegate the share capital increase with a specific report, showing the reasons for the exclusion or limitation of the option right;
b) at least fifteen days before the board resolution to increase the directors must send a report to the control body;
c) at the time of the board resolution, the required reports of the supervisory bodies must exist.
The reduction of the capital
The actual reduction of the share capital can be resolved by the
extraordinary shareholders' meeting
on the basis of reasons that must already be indicated in the notice of call (art. 2445, paragraph 2).
Real Reduction Modalities
three limits must be respected:
a) the minimum capital prescribed by law (art. 2327);
b) the one-to-two ratio between shareholders'
equity and outstanding bonds (Article 2413)
c) in open companies, the ceiling of 20% of the share
capital for treasury shares in the portfolio (Article 2445, paragraph 2).
(Article 2445, paragraph 3) give to the corporate creditors the the
power to oppose within ninety days from the completion of the advertisement.
The reduction for losses
when we say that a spa has partially lost the capital, it means that the difference between the total assets and the liabilities of the company (i.e. the net equity) does not reach the amount of the nominal capital which, therefore, is partially inexistent.
Optional and mandatory reduction
Whenever the capital is partially lost it is possible to reduce the share capital; a reduction that serves to align the nominal amount of capital to the actual one.
Sometimes the reduction
this is what happens when it appears that, as a result of the losses, t
he capital has decreased by more than one third
that is when the net worth is less than two-thirds of the nominal capital
Significant losses and fulfillment of directors' obligations
art. 2446, paragraph 1
Significant losses and mandatory reduction
The reduction becomes mandatory if the loss
is not reduced to minus one third
within the following year (within the second following year for innovative start-up companies and innovative SMEs).
In this case, the ordinary shareholders' meeting (or the supervisory board) which approves the financial statements for this year must reduce the capital in proportion to the ascertained losses.
Significant losses and reduction below the legal minimum
Full loss of share capital
The limited company with shares
The differential features of the s.a.p.a. with respect to the s.p.a.
essentially concern the discipline of the limited partners and can be summarized as follows:
a) The social denomination must contain in addition to the indication of s.a.p.a., the name of at least one of the limited partners (art. 2453);
b) The certificate of incorporation must indicate the names of the general partners (art. 2455, paragraph 1);
c) The general partners are directors under the law of the company and are subject to the obligations of the directors of s.p.a.
d) The revocation of the general partners is allowed only if resolved with the majorities provided for the extraordinary shareholders' meeting of the limited liability company and, if it occurs without just cause, the general partner has the right to compensation for damages (art. 2456).
e) The replacement or appointment of a new general partner implies a modification of the certificate of incorporation and, in addition to being deliberated by the extraordinary assembly, must be approved by all the general partners (art. 2457, comm 1);
h) The modifications to the certificate of incorporation must be approved by the extraordinary shareholders' meeting and approved by all the general partners (art. 2460);
i) The general partners (soci accomandatari)shall be liable personally and unlimitedly to third parties for the fulfilment of their social obligations.