Final Review: BLaP Flashcards
(56 cards)
What is the minimum nominal share capital required for a Public Limited Company
£50k
How does a person cease to be a member of an LLP
- On reasonable notice to the other members
- Notice to Registrar of Companies within 14 days
How many members does an LLP need?
2
What happens when an LLP does not have the required number of members? (Two)
The person who carries on the business alone may do so for 6 months, after which point they become joint and severally liable with the LLP for LLP debts.
Who submits LLP filings to Companies House?
Two designated members
What is the rule for promoter’s liability before/after a company is formed?
Promoters remain liable for contracts they have entered into, even after the company comes into existence, unless there is a novation.
What must be filed at Companies House to form a company?
- Memorandum of Association
- Application for Registration
On what date does a company come into existence?
On the date specified on the Certificate of Incorporation
What is required to amend a company’s articles?
Special resolution (75%) of the shareholders
How many directors must a private company have?
1
How many directors must a public company have?
2
Who may appoint new directors under the Model Articles (unamended)?
Either the directors or the shareholders, by ordinary resolution.
If a new director is appointed, or the details of existing directors changes, when must a company notify the Registrar of Companies about this?
Within 14 days
What is the difference between a de jure, de facto, and shadow director?
De jure: Appointed officially as a director
De facto: Person who claims to be/acts as a director, but has not been officially appointed as such
Shadow director: Person who influences other directors but does not claim to be one.
When might the director’s duty to shareholders be displaced? (i.e., when might they act for the benefit of someone else?)
If the company is on the brink of becoming insolvent, the directors must consider or act in the interest of creditors.
What happens if a director stands to benefit from a transaction being entered into by the company?
This may be a conflict of interest, but a director will not breach their fiduciary duties if:
- The CoI relates to a transaction with the company and the board knows the director has an interest
- The situation is not likely to give rise to a CoI, or
- The matter has been authorised by the directors after full disclosure.
Under the Model Articles (unamended), how many directors must attend a meeting for there to be a quorum?
At least 2
Under the Model Articles (unamended), what is needed to call a meeting of the directors?
Any director may call a meeting by giving reasonable notice to the other directors.
- Does not need to be in writing
- Must indicate time, date, location
Can directors pass written resolutions without a meeting?
Yes, if unanimous.
Who has the power to remove directors?
Shareholders, by majority vote.
NOTE: Remember Bushell v. Faith clauses. Articles can be modified to give weighted voting to a SH who is also a director.
What is the process for removing a director?
- Notice of the resolution to remove the director must be given at least 28 days before the meeting
- Director must be given notice and right to respond at the meeting
- SH vote to remove by majority vote.
In a public company, what must the initial directors do at the first annual meeting?
Retire, and seek reappointment by the SHs
What type of company MUST have a company secretary?
Public companies
What are the statutory requirements to qualify as a company secretary?
- Must have previously been a company secretary for at least 3 years
- Be a member of a regulated accounting or secretarial body
- Is a barrister or solicitor
