Master shares are useful if one key shareholder needs to retain control of particular decisions. Our model sets out sample wording that can be added to your articles for this type of share.
The rights of particular classes of share are described by comparison to those attached to ordinary shares. As the name implies, a master share has control over certain decisions. For example, it may be used in a family business where the figurehead of the firm leaves the day-to-day management to other family members, but wants to have control over the major decisions taken by the company, such as whether it should be wound up or not. When the master shareholder is no longer involved in the business, their share can be transferred to another family member or simply converted into an ordinary share.
When drafting master share rights, consider: