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(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.
marto answered the question on February 7, 2019 at 05:27
- In relation to special notice, state the following:
(i) Objects of a special notice.
(ii) The number of days required.
(iii) The ordinary resolutions...(Solved)
In relation to special notice, state the following:
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(ii) The number of days required.
(iii) The ordinary resolutions which require special notice
Date posted: February 7, 2019. Answers (1)
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Date posted: February 7, 2019. Answers (1)
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(ii) The committee of creditors in administration proceedings.
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(ii) The committee of creditors in administration proceedings.
Date posted: February 7, 2019. Answers (1)
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(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 7, 2019. Answers (1)
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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 7, 2019. Answers (1)
- (i)Citing decided cases, state and describe the characteristics of a 'derivative action.'
(ii) Explain the disadvantages to a minority shareholder in bringing a derivative...(Solved)
(i)Citing decided cases, state and describe the characteristics of a 'derivative action.'
(ii) Explain the disadvantages to a minority shareholder in bringing a derivative action.
Date posted: February 7, 2019. Answers (1)
- Outline the documents that must be delivered to the registrar of companies together
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Outline the documents that must be delivered to the registrar of companies together
with the memorandum of association.
Date posted: February 7, 2019. Answers (1)
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Tama Quin Ltd., a company manufacturing pharmaceutical drugs is about to make a new issue of 400,000 shares of Sh. 40 each at the current market price of Sh. 50 each.
The prospectus states: 'The company has just patented the manufacture of a drug that cures malaria.'
Jacob White, the managing director of the company is interviewed on television and he states that the news to be released shortly will demonstrate a great break-through in the control of malaria. He also stated that the company was the only one with modern technical knowledge of this great invention. As a result there is over-subscription of the shares.
Allan, who has not read the prospectus, applied for shares and is allotted 2000 at the price of Sh. 50 each.
Betty, who read the prospectus, is not allotted any shares but buys 3000 shares at the stock exchange at Sh. 60 per share.
Charles, who read the report of the interview in the national newspaper, bought 5000 shares at the stock exchange at Sh. 55 per share.
In the meantime, the patents are found not to be original and are revoked. The shares fall in value to Sh. 10 per share.
David who owned 10,000 shares in the company long before the new issue is disappointed as he believes the publicity has caused the shares to fall in price (value).
Advise Allan, Betty, Charles and David
Date posted: February 6, 2019. Answers (1)
- (b)
(i)State the circumstances under which the objects clause of a company may
be altered.
(ii) Explain the procedure to be followed in...(Solved)
(b)
(i)State the circumstances under which the objects clause of a company may
be altered.
(ii) Explain the procedure to be followed in altering the objects clause.
Date posted: February 6, 2019. Answers (1)
- In what way does the decision in the case of Macaura Versus Northern Assurance
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In what way does the decision in the case of Macaura Versus Northern Assurance
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Date posted: February 6, 2019. Answers (1)
- Mr. and Mrs. Matanguta intend to form a limited company known as M and M Hardware Limited. They approach you and seek you advice.
...(Solved)
Mr. and Mrs. Matanguta intend to form a limited company known as M and M Hardware Limited. They approach you and seek you advice.
Advise them on the following issues:
(i) What is the meaning of a private limited company according to the Companies Act?
(ii) What are the advantages of forming a private company as opposed to a public company?
(iii) Assuming Mr. and Mrs. Matanguta wish to convert the private company into a public company, what would they be required to do?
Date posted: February 6, 2019. Answers (1)
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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)