Statues

Question 1

3rd Party not bound to enquire about limitations placed on directors, providing they are acting in food faith (Indoor Management Rule)

Answer 1

S.40

Question 2

– Right to Pre-emption (first refusal of new shares to preserve stake in company)

Answer 2

S.560-577

Question 3

Shares cannot be sold at a discount and Alottee is liable to pay discount + interest if sold at discount

Answer 3

S.580

Question 4

Shares can be part paid but remaining amount can be recalled by company.

Answer 4

S.581

Question 5

Share premium account may be used for expenses of issuing new shares, and to fund bonus shares for existing shareholders.

Answer 5

S.610

Question 6

– Rights can be altered in line with AoA or with prior consent of 75% of shareholders in question.

Answer 6

S.630-640

Question 7

– Reduction in share capital only as authorised in law

Answer 7

S.641-649

Question 8

Not possible to reduce capital if only redeemable shares left.

Answer 8

S.641(2)

Question 9

– Purchase of shares out of capital prohibited because no capital would flow into company.

Answer 9

S.658

Question 10

Distrubutions defined as “Every distribution of a companies assets to members in cash or otherwise”

Answer 10

S.829

Question 11

– Distributions only made from profits.

Answer 11

S.830-831

Question 12

Those receiving unlawful distributions must repay it.

Answer 12

S.847

Question 13

Requirement to register charge

Answer 13

S.859

Question 14

If company creates a charge to which s.859 applies, charge will not be Valid unless it is registered.

Answer 14

S.874

Question 15

Require a ordinary resolution at a meeting to remove director

Answer 15

S.168

Question 16

– Director has right to address the meeting (to remove) and circulate written Representation

Answer 16

S.169

Question 17

Directors Duties

Answer 17

S.171-177

Question 18

Unfair Prejudice

Answer 18

S.994-999

Question 19

Minority shareholder protection on basis company affairs conducted in a manner which is unfairly prejudicial to interest of members (including atleast himself)

Answer 19

S.994

Question 20

– If claim well founded, court remedies including regulating conduct, stopping act, beginning civil proceedings.

Answer 20

S.996

Question 21

– guarantees Limited Liability

Answer 21

IA S.74

Question 22

Wrongful Trading – When company in insolvent liquidation , and director knew / ought to have known company had no prospects of not going into insolvent liquidation.

Answer 22

IA S.214

Question 23

– Disqualification Orders

Answer 23

CDDA S.1

Question 24

– Indictable offence = 15 years disqualification

Answer 24

CDDA S.2

Question 25

Persistent Breaches of Company legislation = 5 years disqual.

Answer 25

CDDA S.3

Question 26

Fraudulent trading = 15 years disqual

Answer 26

CDDA S.4

Question 27

– Summary conviction = 5 years disqual

Answer 27

CDDA S.5

Question 28

voluntary disqualification of director of company which became insolvent

Answer 28

CDDA S.6

Question 29

Private LTD companies unable to sell shares except on a “private Concern basis”

Answer 29

s.755