I am the NED for a small CIC which is Limited by Shares, when it was created a few years ago, but we are finding that this excludes us from a number of Grant Awarding Opportunities which is very frustrating.
I know that we can't switch the CIC from one limited to one limited by guarantee, without actually winding up the existing structure and restarting, with all the costs, legal and logistical hassles that this would involve.
However, I would like to know if anyone has ever tried (or succeeded) in making changes to their CIC Articles & Memoranda, which makes it explicit that the share limited CIC will not make any distribution of profits, and that any/all profit to be explicitly reinvested in the company.
If we could do this, theoretically there is no reason why to all practical intents and purposes we wouldn't be acting just as a CIC limited by guarantee and therefore be able to make this clear to grant awarding bodies.
Has anyone ever done this? if they have, has it worked? I would welcome any observations and experiences of members, especially from the legal perspective. It seems that whichever structure you use, it excludes the CIV from certain areas of activity.
Are there any legal experts in this area member might know.
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