Members of a Company Flashcards
Question 1: According to Section 118, who are considered members of a company?
Subscribers to the memorandum of association upon company registration.
Individuals allotted or holding any class or kind of shares.
In companies without share capital, individuals who have agreed to become members and are registered as such.
Question 2: How does the definition of “member” differ from “shareholder”?
While the terms are often used interchangeably, “member” is a broader term. It encompasses not only shareholders but also individuals who have agreed to become members in companies without share capital.
What is the significance of being a member of a company?
Members have certain rights and obligations within the company, such as the right to vote at general meetings, receive dividends (if applicable), and participate in company decisions.
Are all shareholders automatically considered members of a company?
Yes, all shareholders are considered members of a company.
Can someone be a member of a company without owning shares?
Yes, in companies without share capital, individuals can become members by agreeing to do so and having their names entered in the register of members.