Business Flashcards
different classes of shares
Ordinary shares - voting rights
Preference shares - Usually no voting rights, often entitled to fixed dividend
Deferred shares - no right to dividend until certain conditions met.
What is required for share buy-back out of capital?
- Directors statement of solvency
- report by the company auditors
- notices in the London gazette.
De minimus cash exemption for share buy back out of capital
Company can purchase shares out of capital up to an aggregate purchase price in any financial year of the lower of
A) 15k or
B) nominal value of 5% of company fully paid share capital as at the beginning of financial year.
What is required for share buy-back out of profits?
Ordinary resolution.
Procedure for registering a charge?
21 days - otherwise not enforceable against liquidator.
what is a floating charge?
- Charge over a class of assets of company
- The composition will change
- Until crystallisation (even stipulated to occur).
some debt options?
- Overdraft - like usual bank.
- Term loan - fixed term loan
- Revolving credit facility - borrow pay it back and borrow it again
Advantages and disadvantages of debt equity?
Advantage = flexible to arrange in terms of process + maintain control over company + tax efficiency
Disadvantage = cost of finance + risk if you default on a loan
Advantages and disadvantages of Equity finance ?
Advantages = brings ash into business without risk of losing assets + potentially valuable new members
Disadvantages = lose control + requires approval for granting shares.
What is required for directors to pass written resolution?
Unanimous decision.
What is required for short notice?
actual majority and 90% or 95% for public.
What is the special notice of 28 days required for resolutions for?
- Remove a director
- Appoint an auditor
- Remove an auditor before expiration of his term.
What does statute require special resolutions for ?
- Altering articles
- Changing the name of the company
- Dis-apply statutory pre-emptive rights on issue of new shares.
What are required for shareholders to pass written resolutions?
simple majority.
What is a substantial property transaction?
non-cash asset from director or person connected that:
- Exceeds £100k or
- 10% of net asset value and more then £5k.