INTRODUCTION This case deals with Company Law and more specifically with share capital in relation to allotment of shares and transfer of shares. With reference to the Companies Act 2006 and appropriate case law it is hoped that a reasoned conclusion is reached for the issues put forward by Verity. ALLOTMENT OF SHARES The general provisions for the allotment of shares are found in sections 549 to 551 of the Companies Act 2006 and there are different provisions depending on what type of company is involved. The directors of a public limited company cannot exercise their powers to allot shares in the company under section 549, Companies Act 2006 ; however, the directors of a private limited company can exercise their powers to allot shares only if the company is dealing with one class of shares. In section 551 of the Companies Act 2006, it states that the company must have authorisation by way of a provision stated in the company’s articles or by way of an ordinary resolution if provisions are unavailable in the articles. Within the terms of the authorisation it must state the maximum amount of shares to be allotted and the duration of the allotment which cannot be more than five years. If the company fails to obtain this approval the directors involved who “knowingly contravenes, or permits or authorises a contravention” of this authorisation, under section 549 of the Companies Act 2006, he, she or they commits an offence. If he, she or they are found to be guilty, liability falls to her, him or them personally but does not invalidate the allotment. In this particular case, focus is on section 550, Companies Act 2006 as we are dealing with a private limited company which only has ordinary shares. Before any shares have been i... ... middle of paper ... ...ing shareholders do not wish to purchase any of them. Additionally, the transfer is also legal on the basis that the proper procedures are taken to proceed with the transfer. CITATIONS Dodds v Cosmopolitan Insurance Co [1915] SC 992 (IH) Hackney Pavilion Ltd [1924] 1 Ch 276, Re McLintock v Campbell [1916] SC 966 (IN) Rayfield v Hands [1960] Ch 1 Zinotty Properties Ltd [1984] 3 All ER 754, Re BIBLIOGRAPHY Black, G et al. (2011), Business Law in Scotland, (2nd edn), London, W Green Crossan, S.J and Wylie, A.B. (2010), Introductory Scots Law Theory and Practice, (2nd edn), Paisley, Hodder Education Ervine, C. (2013), Core Statutes on Company Law, (13-14 edn), Palgrave MacMillan Hicks A. and Goo, S.H. (2008), Cases and Material on Company Law, (6th edn), New York, Oxford University Press Pillians, B and Bourne, N. (2012), Scottish Company Law 2/e, Routledge
The value of Poor Son declined significantly since external economic conditions. It shows that the fair value of Poor Son, the emerging entity, should be way less than its book value, and the value of assets is less than the total of liabilities and claims. Additionally, Parent will receive 100% voting shares of Poor Son and have the ability to name all members of Poor Son’s board of directors. This means that existing voting shares receive less than 50% of the voting shares of the emerging entity. For that reasons, Poor Son should apply “Fresh-Start” under ASC 852-10-45-19.
R v International Stock Exchange of the UK and the Republic of Ireland Ltd, ex p Else (1982) Ltd and others [1993] 2 CMLR 677
... Human Rights in Scotland [PDF] available at Scottish Human Rights Commission website; scottishhumanrights.com/application/resources/documents/SNAP-GettingitRightAnOverviewofHumanRightsinScotland2012.pdf (p.215)
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9. Woodgate, R., Black, A., Biggs, J., Owens, D. (2003). Legal Studies for Queensland, Volume 1, ForthEdition, Legal Eagle Publications: Queensland. 10. Woodgate, R., Black, A., Biggs, J., Owens, D. (2003).
Eckbo and Masulis (1992) open their paper by explaining the decline in rights issues and the surge in firm commitments. To show this Eckbo and Masulis use a sample of 1,249 equity offers between 1963-1981.
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This concludes my summary of lessons gleaned from the course BSL 301 Legal Research, Writing, and Analysis referencing Honigberg, G. "Gilbert Law Summaries: Legal Research, Writing, and Analysis" 10th ed. BarBri Group, 2006.
According to Corporation Act 2001 s124(1), it illustrates that ‘’A company has the legal capacity and powers of an individual both in and outside the jurisdiction” . As it were, company as a legal individual must be freely with all its capital contribution shall embrace liability for its legal actions and obligations of the company’s shareholders is limited to its investment to the company. This ‘separate legal entity’ principle was established in the case of Salomon v Salomon & Co Ltd [1987] as company was held to have conducted the business as a legal person and separate from its members. It demonstrated that the debt of company is belonged to the company but not to the shareholders. Shareholders have only right to participate in managing but not in sharing the company property. Besides ,the Macaura v Northern Assurance Co Ltd [1925] demonstrates that the distinction between the shareholders and company assets. It means that even Mr Macaura owned almost all the shares in the company, he had no insurable interest in the company’s asset. The other recent case is the Lee v Lee’s Air Farming Ltd [1961] which illustrates that the distinct legal entities between employee ad director allows Mr.Lee function in dual capacities. It resulted that the corporation can contract with the controlling member of the corporation.
Nottingham Trent University. (2013). Lecture 1 - An Introduction to Corporate Governance. Available: https://now.ntu.ac.uk/d2l/le/content/248250/viewContent/1053845/View. Last accessed 16th Dec 2013.
Currently, directors have no prima facie entitlement to be remunerated for their work (Hutton v West Cork Railway Co 1883), but Article 23 of the Companies (Model Articles) Regulations 2008 establishes that it is for directors to decide the lev...
Frank A. Easterbrook, ‘Legal Interpretation and the Power of the Judiciary’ [1984] 7 Harv. J.L. Pub. Pol’y 87 http://heinonline.org/HOL/LandingPage?collection=journals&handle=hein.journals/hjlpp7&div=18&id=&page= accessed 14 February 2012. J. A. Holland & Julian Webb, Learning Legal Rules, 6th edn, Oxford 2006, pp. 113-117.
[7] Cavendish Lawcards Series (2002) Company Law (3rd edn), p.15 [8] [1976] 3 All ER 462, CA. [9] Griffin, S. (1996) Company Law Fundamental Principles (2nd edn), p.19 [10] [1990] Ch 433. [11] Lecture notes [12] Lecture notes [13] [1939] 4 All ER 116.
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