(i) Under section 30 (1) of the Companies Act, a private company means a company whose articles of association:
- Limit the number of members to 50 excluding current and former employees who are members.
- Restrict the right to transfer its shares
- Prohibit any invitation to the public to subscribe for its shares or debentures.
(ii) Original members are able to control membership.
- Members retain control as shares are not freely transferable.? ? It is entitled to commence business at anytime after incorporation.
- It is subject to less formalities e.g. need not publish accounts or hold the statutory meeting.
(iii) -Mr. and Mrs. Matanguta must comply with the provisions of the Companies Act. The company must hold an extra ordinary general meeting to pass a special resolution to amend or alter the provisions of section 30 (1) of the Act.
- The company ceases to be private on the date of the resolution and must within 14 days thereof deliver to the registrar for registration either.
- A prospectus containing the particulars of Part I and II of 3rd
schedule or
-A statement in lieu of prospectus containing the particulars of Part I and II
of the 2nd schedule.
marto answered the question on February 6, 2019 at 11:23
-
In relation to company meetings, explain the following:
(i) Issues that require special resolution(Solved)
In relation to company meetings, explain the following:
(i) Issues that require special resolution
Date posted: February 6, 2019. Answers (1)
- Describe the meaning and essence of an application for early dissolution.
(Solved)
Describe the meaning and essence of an application for early dissolution.
Date posted: February 6, 2019. Answers (1)
- Describe the following:
(i) The committee of creditors in liquidation.
(ii) The committee of creditors in administration proceedings(Solved)
Describe the following:
(i) The committee of creditors in liquidation.
(ii) The committee of creditors in administration proceedings
Date posted: February 6, 2019. Answers (1)
- Discuss the position of a company auditor with regard to the following:
(a) A company wishes to remove its auditor from office before the...(Solved)
Discuss the position of a company auditor with regard to the following:
(a) A company wishes to remove its auditor from office before the next annual general
meeting.
(b) An auditor considers that he has been intentionally obstructed by company officers
from carrying out his professional and statutory duties.
(c) EFG Company Limited purchased shares in PQR Company Limited on the basis of
PQR Company Limited‟s audited accounts. Unfortunately, EFG Company Limited has incurred losses as a result of the purchase.
EFG Company Limited considers that the auditor was negligent in carrying out his audit.
EFG Company Limited wishes to sue the auditor for the loss it has incurred.
Date posted: February 6, 2019. Answers (1)
- Jane Wangokho is a minority shareholder of Tuzo Company Limited.
John Daudi is the managing director and majority shareholder of Tuzo Company Limited.
...(Solved)
Jane Wangokho is a minority shareholder of Tuzo Company Limited.
John Daudi is the managing director and majority shareholder of Tuzo Company Limited.
Jane Wangokho has discovered that John Daudi has breached his duties as a director by purchasing goods from the company at a gross undervalue. A general meeting of the company at which John Daudi attended and voted has ratified the sale.
Advise Jane Wangokho on the courses of action she may take.
Date posted: February 6, 2019. Answers (1)
- Explain the disadvantages to a minority shareholder in bringing a derivative action.
(Solved)
Explain the disadvantages to a minority shareholder in bringing a derivative action.
Date posted: February 6, 2019. Answers (1)
-
Citing decided cases, state and describe the characteristics of a derivative action.(Solved)
Citing decided cases, state and describe the characteristics of a derivative action.
Date posted: February 6, 2019. Answers (1)
- Outline the documents that must be delivered to the registrar of companies together
with the memorandum of association.(Solved)
Outline the documents that must be delivered to the registrar of companies together
with the memorandum of association.
Date posted: February 6, 2019. Answers (1)
- What are the contents of the memorandum of association as stated in the...(Solved)
What are the contents of the memorandum of association as stated in the
Companies Act?
Date posted: February 6, 2019. Answers (1)
- Distinguish a company limited by shares from a company limited by guarantee.
(Solved)
Distinguish a company limited by shares from a company limited by guarantee.
Date posted: February 6, 2019. Answers (1)
- Distinguish between the following classifications and debentures:
(a) Bearer debentures and registered debentures.
(b) Redeemable debentures and irredeemable debentures.
(c) Debentures and debenture...(Solved)
Distinguish between the following classifications and debentures:
(a) Bearer debentures and registered debentures.
(b) Redeemable debentures and irredeemable debentures.
(c) Debentures and debenture stock
(d) Unsecured debentures and secured debentures
Date posted: February 6, 2019. Answers (1)
- Anna and Berita are directors of Pesa Limited and each holds forty per cent of the ordinary shares. The remainder is held by Charles.
...(Solved)
Anna and Berita are directors of Pesa Limited and each holds forty per cent of the ordinary shares. The remainder is held by Charles.
In addition to the shares, Anna also holds debentures issued by Pesa Limited, redeemable on 8 August 2003. Anna wishes to dispose of her shares and debentures.
On the other hand, Berita and Charles do not wish Anna's substantial interest in the company to pass to other people upon the sale of the shares and debentures.
Advise Pesa Limited on the legality of each of the courses of action listed below:
(a) Pesa Limited will raise the necessary funds and purchase the shares and debentures.
(b) Pesa Limited will raise funds and lend them to Charles so that he may purchase Anna's debentures. Charles will also arrange for a private loan guaranteed by Pesa Limited so that he may purchase Anna‟s shares.
(c) A new company, Pendo Limited, will be formed and eighty per cent of its ordinary shares will be held by Pesa Limited. Berita and Charles to hold ten per cent each. Pendo limited will borrow money to buy Anna's shares and debentures
Date posted: February 6, 2019. Answers (1)
- Martha is engaged in the promotion of a company. She seeks your advice on several matters relating to the promotion of a company. You are...(Solved)
Martha is engaged in the promotion of a company. She seeks your advice on several matters relating to the promotion of a company. You are required to advise her on the following matters:
(a) The restrictions upon the choice of a corporate name with which a promoter must
comply.
(b) The legal duties of a promoter with regard to her responsibility where she sells her
own property to the company she is promoting.
(c) The promoter's right to payment for her services by the company after
incorporation.
Date posted: February 6, 2019. Answers (1)
- Section 213 of the Companies Act qualifies the liability of past and present members as contributors. Explain these qualifications as provided for in the...(Solved)
Section 213 of the Companies Act qualifies the liability of past and present members as contributors. Explain these qualifications as provided for in the Companies Act.
Date posted: February 6, 2019. Answers (1)
- Enumerate the circumstances under which the court may order the winding up of a company on a just and equitable ground. (Solved)
Enumerate the circumstances under which the court may order the winding up of a company on a just and equitable ground.
Date posted: February 6, 2019. Answers (1)
- Rush, Fast and Speed are directors of Modern Technology Company Ltd. The company was formed with the main object of computer training. However, due to...(Solved)
Rush, Fast and Speed are directors of Modern Technology Company Ltd. The company was formed with the main object of computer training. However, due to the power rationing, the company business has fallen below the expected productivity and is threatened with closure. In order to keep afloat, the three directors approached Money Bank Ltd for an overdraft of Sh. 2 million to establish an off-licence bar and restaurant within the city centre. The credit manager asked the company to provide its copy of the memorandum of association and the company complied. Modern Technology was then given the overdraft. However, it has run into financial difficulties and is unable to repay the loan.
Can the bank successfully sue for recovery of the loan?
Date posted: February 6, 2019. Answers (1)
- Explain the circumstances under which directors of a company will be held personally liable to acts committed on behalf of the company.(Solved)
Explain the circumstances under which directors of a company will be held personally liable to acts committed on behalf of the company.
Date posted: February 6, 2019. Answers (1)
- (i)What is a special notice?
(ii) Give the circumstances under which a special notice would be required with respect to company meetings. (Solved)
(i)What is a special notice?
(ii) Give the circumstances under which a special notice would be required with respect to company meetings.
Date posted: February 6, 2019. Answers (1)
- State the Rule in Sharp-vs-Dawes and explain the exceptions to this rule? (Solved)
State the Rule in Sharp-vs-Dawes and explain the exceptions to this rule?
Date posted: February 6, 2019. Answers (1)
- Identify the different types of meetings that may be held by police limited companies.(Solved)
Identify the different types of meetings that may be held by police limited companies
Date posted: February 6, 2019. Answers (1)