Business Flashcards
Constitutional Documents
CA 1985 - articles of association and memorandum.
CA 2006 - memorandum no longer forms.
Memordandum
CA 1985 - company’s constitution - constitutional restrictions / objects clause (why company formed).
CA 2006 - not required/formality. unrestricted objects unless included objects clause.
Articles of Association
S18 CA 2006 - all companies must have
Regulates relationships between S / D / the company
Company’s internal rulebook dealing with directors, shareholders, meetings and key administrative requirements
Short Notice - General Meetings
Majority shareholders - aka 3 out of 4
who together hold 90% of shares
CA 2006 - reserved decisions for shareholder approval
- Change company name
- Amend Articles
- Remove directors from office
MA 3
Board with Model Articles free to make decisions on behalf of company on all other matters
MA 5
Board can delegate decisions to a director / committee
Directors
Accountable to the company
Daily management of business - agency relationship
s155(1) CA 2006 - one must be a natural person
s157 CA 2006 - must be 16 years old
Shareholders
Own company
Control key decisions
De Jure director (in law)
Validly appointed at law
De Facto director (in fact)
Assumes to act as director but who has not been validly appointed
Minimum number of directors
Private - 1 (in private you only have one face)
Public - 2 (in public, you have two faces)
Shadow director
A person in accordance with whose directions / instructions, the directors of the company are accustomed to act
- Cannot be a professional adviser
- Example: a friend giving D advice behind the scenes
Executive director
A director who has been appointed to executive office
- Working time on business of company
Non-executive director
Officer of the company but will not be an employee of the company
- Provides advice to board
