Companies Act Flashcards
(37 cards)
What are pre-emption rights?
Rights given to existing shareholders which prevent dilution, have right of refusal to new shares issued for cash
What is a scheme of arrangement?
Compromise arrangement with shareholders or creditors allowing it to restructure itself
What is a squeeze out?
Bidder acquires 90% of shares or 90% of voting rights, bidder may oblige shareholders to sell any remaining shares to them
What is a sell out?
Bidder has acquired >90% in value, shareholders who did not accept offer have right to oblige bidder to acquire their shares
How many days given to shareholders to make a decision in pre-emption rights?
14 calendar days
What are the exceptions for listed companies for pre-emption rights?
- Special resolution: (Suspend up to 5 years with a special resolution)
- General approval: if issuing no more than 5% of issued share capital in one year, 7.5% over three years
What are the restrictions on non pre-emptive issues pricing based on Listing Rules?
Price cannot be at a discount of more than 10% to the middle market price
When may the share capital be reduced?
AoA allow it, a special resolution is passed and courts approve action for plc
When can shareholders appoint inspectors from BEIS to investigate company?
1) Ordinary resolution is passed or
2) >200 shareholders or owners at least 10% of issue shares
Define financial assistance rule (CA S678-680)?
Prohibits a public company or its subsidiary from directly or indirectly giving financial assistance to a third party for the purchase of its own shares or to reduce or discharge a liability incurred by a purchaser or third party for purpose of acquisition
What is the penalty for financial assistance in the purchase of shares in itself?
2 years and unlimited fine
Contracts are void
What is the notice period for AGM?
21 calendar days for plc and 14 calendar days for ltd
What is the notice period for GM?
21 calendar days for plc (may shorten to 14 days if shareholders agree) and 14 calendar days for ltd
Who can propose a resolution?
1) Directors,
2) Shareholders with either 5% of voting rights, >100 shareholders holding at least £100 paid-up share each
When does a company / person have to disclose shareholdings?
If no previous interest, when shareholdings are above 3% or any change to whole % point if over 3% (disclose within 2 business days)
What requirements does a plc must satisfy?
- Minimum of two shareholders
- Minimum share capital of £50,000 (at least 25% nominal paid up)
- Registered as plc
- Memorandum stating as plc
Which are the primary legislation for money laundering?
- POCA
- SOCPA
- Terrorism Act 2000
- Counter-Terrorism Act 2008
Describe 3 stages of money laundering
- Placement: proceeds of any crime are placed in bank
- Layering: Cheque is drawn to buy different investments to cover audit trail
- Integration: Money appears as legitimate source of income
What is the maximum penalty for money laundering?
14 years and or unlimited fines
What is the maximum penalty for prejudicing a money laundering investigation?
Five years and or unlimited fine
What is the maximum penalty for failure to comply with Money Laundering Regulations?
Two years and or unlimited fine
What are 3 main requirements for firms under the Money Laundering Regulation 2017?
- Administrative
- Training of relevant employees
- Preventative
What is the difference between money laundering and terrorist acts?
Size of fund and origin of fund being legitimised
What is the maximum penalty for bribery?
10 years and or unlimited fine
