lecture 43 Flashcards
(32 cards)
What must a company maintain under Section 210 regarding contracts of employment with directors?
Every company (except private companies) must keep a copy of the written contract or a memorandum of its terms at the registered office and allow inspection by members without fee.
What restriction is imposed under Section 211 on non-cash transactions involving directors?
No company shall enter into non-cash asset transactions with directors or their associates unless approved by resolution in general meeting and accompanied by a valuation from a registered valuer.
When can a director be declared lacking fiduciary behavior under Section 212?
If the director contravenes Sections 205, 206(1), 207, or 208, and after being provided an opportunity to show cause, the Court may declare him to lack fiduciary behavior.
What is the requirement under Section 213 for directors interested in contracts appointing CEO or secretary?
Interested directors must disclose their interest during board meetings and refrain from voting; contracts must be kept at the registered office and made available to members.
What obligation exists under Section 214 for contracts by company agents with undisclosed principals?
Officers must document and deliver such contracts to the board; default may render the contract void and result in a level 1 penalty.
What conduct is expected of shareholders under Section 215?
Members must act in good faith, avoid disruptive conduct, and not directly interfere with management. Violation can lead to a level 1 penalty.
When is a company deemed to be a public interest company under Section 216?
When it meets the criteria of the Third Schedule; such companies must follow additional SECP disclosure/reporting requirements unless exempted in writing.
What does Section 217 say about handling of securities and deposits?
No company may receive/utilize deposits or security money except through a written contract, and it must be deposited in a scheduled bank’s special account.
What are the general powers of directors under Regulation 47?
Directors may manage the company and exercise all powers not required by the Act or regulations to be exercised in general meeting.
What does Regulation 48 require regarding appointment of Chief Executive?
Directors must appoint a chief executive in accordance with sections 186 and 187 of the Act.
What borrowing limitation is imposed under Regulation 49?
Without general meeting approval, directors cannot borrow more than the company’s issued share capital.
What compliance duty is imposed on directors under Regulation 50?
Directors must comply with statutory requirements like registration of charges, maintaining director registers, and reporting changes to registrar.
What must be recorded under Regulation 51 regarding meetings?
Resolutions, names of attendees, and orders must be recorded in minute books, including video-link proceedings.
What does Regulation 52 state about the company seal?
The seal can only be used by authority of board resolution in presence of two directors and the secretary or designated person.
Who is disqualified from being a director under Regulation 53?
Anyone suffering disqualifications under Section 153 or other Act provisions; such a person shall vacate office automatically.
What provisions are stated in Regulation 54 regarding directors’ meetings?
Directors may meet as they see fit; meetings can be summoned via email even if a director is outside Pakistan.
What does Regulation 55 provide regarding the chairman of directors’ meetings?
Directors may elect a chairman; if unavailable, present directors can choose one among them.
What constitutes quorum under Regulation 56?
At least one-third or two directors, whichever is higher, present physically or via video-link.
How are decisions made under Regulation 57?
By majority vote; the chairman has a casting vote in case of a tie.
What powers can be delegated under Regulation 58?
Directors may delegate powers to committees formed from among themselves with imposed restrictions.
What does Regulation 59 state about resolutions by circulation?
A written resolution signed by all directors is valid as if passed in a board meeting.
What does Regulation 60 say about validity of director acts?
Acts of directors remain valid even if later found improperly appointed or disqualified.
What is provided under Regulation 61 for alternate or substitute directors?
Casual vacancies or absences for 90+ days can be filled by alternate directors approved by the board.
What is required under Regulation 62 for removal of a director?
A director may be removed by a general meeting resolution per Section 163.
