Lecture 42 Flashcards
(23 cards)
Define ‘Chief Executive’ as per the Companies Act, 2017.
An individual who, subject to the control and directions of the board, is entrusted with whole or substantially whole of the powers of management of affairs of the company, and includes a director or any person occupying that position.
According to Section 186, who appoints the first Chief Executive?
Subscribers to the memorandum determine the first Chief Executive and provide his particulars at incorporation.
What is the maximum term of appointment for a Chief Executive as per Section 187?
Three years from the date of appointment.
What does Section 188 state about terms of appointment of a Chief Executive?
Terms are determined by the board or general meeting unless nominated by Government, in which case terms are decided by the Government.
Under Section 189, who is disqualified from being appointed as Chief Executive?
Anyone ineligible to be a director under Section 153 or disqualified under Sections 171 or 172.
What is the removal process for a Chief Executive under Section 190?
By resolution of at least three-fourths of the board or by special resolution in a general meeting.
What restriction is imposed by Section 191 on public company CEOs?
They must not directly or indirectly engage in competing business.
As per Section 192, who appoints the Chairman of a listed company?
The board appoints a non-executive director as Chairman within 14 days of election of directors.
What is the penalty under Section 193 for contravening Sections 186 to 192?
Penalty of level 2 and possible disqualification from being director or CEO for up to 5 years.
What requirement is imposed by Section 194 on public companies?
To appoint a qualified company secretary.
What does Section 195 require for listed companies?
They must have an independent share registrar with specified qualifications.
Under Section 196, what appointment needs SECP’s approval?
Appointment of sole purchase, sale or distribution agents.
What register must companies maintain under Section 197?
A register of directors and officers including CEO, secretary, CFO, auditors, legal adviser.
What does Section 201 provide for in relation to contracts?
The method of contracting by a company, including authorization and use of common seal.
What does Section 202 say about execution of bills and promissory notes?
They must be executed by authorized persons in the name of the company.
What does Section 203 require for foreign operations?
Companies must have an official seal for use abroad.
What duty is imposed on directors under Section 204?
To act honestly and in good faith with due care and diligence.
What must a director disclose under Section 205?
Any direct or indirect interest in contracts or arrangements with the company.
What is required of officers under Section 206?
Disclosure of interests in transactions involving the company.
What does Section 207 prohibit for interested directors?
They cannot vote or participate in board decisions where they are interested.
How are related party transactions handled under Section 208?
They must be disclosed and approved per prescribed procedures.
What register is maintained under Section 209?
Register of contracts/arrangements in which directors are interested.
What does Regulation 52 of Companies Regulations 2024 cover?
It specifies compliance procedures for CEO nomination and disqualification reporting to the SECP.
