Authority to allot — single-class private company (s.550)

Harrow Joinery Ltd is a private company limited by shares incorporated in 2024. It has issued 8,000 ordinary shares, which are its only class of share. The articles of association are the unamended model articles for private companies. The two directors, who together hold 60% of the shares, want to allot a further 2,000 ordinary shares to a new investor to fund the purchase of workshop equipment. The investor will pay cash and the existing shareholders have all confirmed in writing that they do not wish to take up any new shares. One director believes the board cannot allot the shares without first passing an ordinary resolution of the members granting the directors authority to allot.