Company Formation Flashcards
What are the forms of articles?
Model Articles
Amended Articles
Tailor made articles
What needs to be delivered to companies house to incorporate from scratch?
- Copy memorandum
- Articles (if not MA)
- Fee
- Application form (IN01)
What should be in the application form IN01?
o Proposed name/registered office
o Limited by shares? (or guarantee)
o Statement of capital/initial shareholdings (s10) (or details of guarantee s11)
o Proposed officers (directors + co secretary s12) + persons with significant control (s790)
o Statement of compliance (s13)
What is the legal effect of articles of association?
Bind the company and members same as a covenant
How can articles be amended and what is the basic rule?
Special resolution of shareholders
Bona fide in the interests of the company as a whole
How can members enforce articles between members?
Enter into a shareholder agreement
How can articles be enforced between members and the company?
Court injunction for breaching article rights
Members obliged to comply
Members can’t enforce rights not relevant in their capacity as members
Can members of a company enforce articles directly against other members?
No only through the company itself
Is a memorandum required?
Not constitutionally but is required to be incorporated
What is a memorandum?
Declaration of company’s subscribers that they wish to form a company and agree to be members
What will need to be changed when incorporating a purchased shelf company?
Name
Registered office
Articles
Members/directors/secretary
Why is the order of appointing/resigning directors important when incorporating a shelf company?
There must always be at least one director if complying with unamended MA
How should members/directors/secretary be changed when incorporating a shelf company?
o Shares held by subscribers transferred. Client becomes SH when on register of members using stock transfer form
o Reps appointed as directors/secretary AP01 directors, AP03 secretary
o First director(TM01)/secretary (TM02) resigns.
What must a company name be?
No offensive
End in Limited/ltd if private limited company
Must not be the ‘same as’ another on the index of company names
Approval if suggests connection with govt/public authority
Is a pre-incorporation contract enforceable?
Only against the promoter, they are personally liable
What are the post incorporation steps?
Chairperson: elect/casting vote?
Accounting reference date - default last day of month
Auditor: Board resolution if unamended MA
Tax registration: corporation tax/VAT/PAYE/National Insurance
Shareholder agreement: not required
Why does the Contracts Act (Rights of Third Parties) not apply to pre-incorporation contracts?
Because it imposes an obligation on third parties as well as a benefit
When incorporating a new company with unamended MA, should you send articles to CH?
No, only fee, memorandum and form IN01
When is a new name effective?
When the registrar issues a new certificate of incorporation
When might a decision be referred to shareholders?
- Matter outside powers of directors and must be effected by resolution of SH
- Matter within powers of directors but requires approval of SH before directors authorised
How are decisions of the board taken?
By board resolutions at board meetings
How many votes does each director have in a board meeting?
One
How are board resolutions passed?
By simple majority unless agreed a particular decision requires unanimity
How can shareholder resolutions be made?
General meeting
Writing (private companies)
