|£1 ordinary shares|
|Most companies have only one class of shares - ordinary shares. Ordinary shares are by far the most common type of share. For example, the vast majority of shares listed for sale on the London Stock Exchange are ordinary shares.|
Ordinary shares have no unusual rights attached to them, for example, special preferential voting or dividend rights which a preference share might have, or a right to redeem the share which a redeemable preference share might have. Shareholders of ordinary shares have the normal and ordinary rights as set out in various sections of the Companies Act 1985 and various rights as developed by the courts over the last few hundred years.
The '£1' refers to the 'par value' of the individual shares. The authorised share capital is required to be divided into shares of a fixed amount (known as the 'par' or 'nominal' value) - section 2(5)(a) of the Companies Act 1985. The par value may be any fraction of the authorised capital, e.g. it may be as low as one penny or it may be £100 or more. For limited liability companies (such as UKcorporator's standard company configurations) a member/shareholder who has paid the full par value of their shares is (barring special circumstances such as reckless incurring of debts by the company where the shareholder was also a director) under no obligation to pay more to the company or its creditors. The par value of a share does not necessarily bear any relationship to its real value. In fact the par value of a share can be vastly different from its real value. For example, for most of the 1990's the real value of British Telecom's shares was no less than £5 and yet their par value was £1. The real value of a company's shares rises and falls depending upon the fortunes of the company from time to time, irrespective of its fixed par value.