Section 4Part 2 — Becoming a Foundation Company
Foundation company requirements
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For a company to be a foundation company, the requirements (the “foundation company re quirements”) are that —
it is limited by shares or by guarantee, with or without share capital;
it has a memorandum that —
states the company is a foundation company;
generally or specifically describes its objects (which may, but need not, be beneficial to other persons);
provides, directly or by reference to its articles, for the disposal of any surplus assets the company may have on winding - up; and
prohibits divide nds or other distributions of profits or assets to its members or proposed members as such; and
it has adopted articles; and
its secretary is a qualified person.
For subsection (1)(b)(iv), a member is not regarded as receiving a dividend or dis tribution as a member merely because the member —
is a beneficiary of the foundation company and receives benefits as such;
receives reasonable remuneration as a director, officer or a person having a duty under its constitution;
is indemnified or reimbursed for expenses or liabilities incurred in relation to the company;
benefits from a loan or other transaction or relationship entered into with the company on terms that are no more favourable to the member than if they had been negotiated at arm ’ s length; or
will or may, under the constitution, receive benefits from the disposing of surplus assets on winding - up.