LML4801 company law LML 4806-notes.

Contents 1 Shareholders and Company Meetings ........................................................................................................................ 2 2 Directors, Board Committees and the Company Secretary ........................................................................................ 6 3 Duties of Directors ....................................................................................................................................................13 4 Capacity and Representation of a Company .............................................................................................................17 5 Corporate Finance: Shares and Debentures .............................................................................................................19 6 Capital Maintenance .................................................................................................................................................23 7 Groups of Companies ................................................................................................................................................26 8 Takeovers, Offers and Fundamental Transactions ...................................................................................................27 9 Business Rescue Proceedings ....................................................................................................................................32 10 Abbreviations ........................................................................................................................................................39 Downloaded by Esther Austin () lOMoARcPSD| 1 Shareholders and Company Meetings 1.1 Introduction Shareholder: ▪ Term used only in respect of a profit company. ▪ Person who is entitled to exercise any voting rights in relation to a company, irrespective of the form, title or nature of the securities to which those voting rights are attached. ▪ Retain control over the directors by their power to appoint and remove directors ▪ Approve important decisions of the directors Member: ▪ Term used for non-profit companies who do not have shareholders Directors: ▪ Have authority to exercise all powers and perform any of functions of the company, except to extent that Act or company’s Memorandum of Incorporation provides otherwise ▪ Have a duty to manage the company 1.2 Notice of Meetings Notice must: ▪ be in writing ▪ include date, time and place for the meeting ▪ explain general purpose of the meeting; ▪ contain a statement that a shareholder is entitled to appoint a proxy to attend, participate in and vote at the meeting in the place of a shareholder ▪ should indicate the participants will be required to provide proof of identity at the meeting ▪ be accompanied by a copy of any proposed resolution which will be considered at the meeting ▪ indicate percentage of voting rights required for the resolution to be adopted ▪ Notice before date of meeting: • Public company & non-profit company with voting members: 15 business days • Any other company: 10 business days • MOI may prescribe longer minimum notice ▪ Notice convening AGM: • must contain summary of the financial statements • must explain procedure shareholder can follow to obtain complete financial statements Defective notice: ▪ Meeting may proceed if: • Persons who are entitled to vote i.r.o. each item on agenda: ▪ are present ▪ acknowledge actual receipt of notice ▪ agree to waive notice of meeting / ratify defective notice • Where defect relates to one/more matters on the agenda: ▪ matter may be taken off agenda; notice remains valid w.r.t. remaining matters ▪ where defective notice ratified: meeting may consider matter 1.3 Representation by Proxy Getz v Spaarwater: Validity or otherwise of proxy must depends on facts of each case. Material departure from prescribed form may invalidate proxy. Here: only date of execution on form left blank and this non-compliance was judged to not be of a material nature. Davey and others v Inyaminga Petroleum: cf. Getz. Prescribed form required proxy giver to set out number of shares i.r.o. which he was authorizing proxy to vote. Non-compliance was judged to be of a material nature and proxy was thus incomplete and invalid. Ingre v Maxwell: Must be at least 2 persons present to constitute a meeting; not valid where 1 person holds all proxies of all persons who were entitled to attend meeting.