LML4806 - Company Law Test Questions
and Verified Answers | Already Graded
A+
What info must be contained in a compromise proposal? - ✔✔- any proposals
made "informally" by a company creditor
- details of all assets and creditors
- treatment of ongoing contracts
- order of preference, proceeds apply
- conditions precedent
- number of employees
- t&c of employment
- projected balance sheet
- income and expenses for 3 years
- certificate by authorized director stating info is factual, accurate, up to date
When will compromise be adopted and binding - ✔✔- S155(6) adopted if
supported by a majority in number representing at least 75% in value of
creditors
- A company may apply to court for an order approving the proposal
1|Page
©JOSHCLAY 2025/2026. YEAR PUBLISHED 2025.
, - suggests it is not necessary for a company to obtain sanction of High Court
before a compromise becomes binding on dissenting creditors
Record date - ✔✔- determines certain rights of shareholders
- S59(1) a company may set a record date for purpose of determining which
shareholders are entitled to receive the notice, vote etc
- latest date by which the company is required to give notice to SH of the
meeting, or date of action or event
- board fail to set date, date is last day on which notice should be given to SH of
SH meeting (public = 15 bdays; private = 10 bdays)
Compromise - ✔✔- agreement or arrangement or restructuring of claims
between a company and its creditors in terms of which the creditors agree to
accept less than their full claims against the company
- binding on all companies creditors
Compromise proposal is divided into three parts - ✔✔- background
- the proposal itself
- assumptions and conditions
How is proposal of compromise effected? - ✔✔- by delivery of a copy of the
proposal
2|Page
©JOSHCLAY 2025/2026. YEAR PUBLISHED 2025.
and Verified Answers | Already Graded
A+
What info must be contained in a compromise proposal? - ✔✔- any proposals
made "informally" by a company creditor
- details of all assets and creditors
- treatment of ongoing contracts
- order of preference, proceeds apply
- conditions precedent
- number of employees
- t&c of employment
- projected balance sheet
- income and expenses for 3 years
- certificate by authorized director stating info is factual, accurate, up to date
When will compromise be adopted and binding - ✔✔- S155(6) adopted if
supported by a majority in number representing at least 75% in value of
creditors
- A company may apply to court for an order approving the proposal
1|Page
©JOSHCLAY 2025/2026. YEAR PUBLISHED 2025.
, - suggests it is not necessary for a company to obtain sanction of High Court
before a compromise becomes binding on dissenting creditors
Record date - ✔✔- determines certain rights of shareholders
- S59(1) a company may set a record date for purpose of determining which
shareholders are entitled to receive the notice, vote etc
- latest date by which the company is required to give notice to SH of the
meeting, or date of action or event
- board fail to set date, date is last day on which notice should be given to SH of
SH meeting (public = 15 bdays; private = 10 bdays)
Compromise - ✔✔- agreement or arrangement or restructuring of claims
between a company and its creditors in terms of which the creditors agree to
accept less than their full claims against the company
- binding on all companies creditors
Compromise proposal is divided into three parts - ✔✔- background
- the proposal itself
- assumptions and conditions
How is proposal of compromise effected? - ✔✔- by delivery of a copy of the
proposal
2|Page
©JOSHCLAY 2025/2026. YEAR PUBLISHED 2025.
