Stakeholders in a Company Flashcards
Who are key stakeholders in a company?
1) Shareholders
2) Directors
3) PSOC
Do shareholders need to a be human being?
No
If Company A owns Company B, what is Company B to them?
A wholly owned subsidiary
What is most common type of share?
Ordinary share
What is a nominal value?
Minimum subscription price for that share, representing unit rather than price
If a share is allocated for more than nominal value, what is this called?
Premium
How do you calculate issued share capital?
Total value of nominal and premium
What is paid-up share capital?
Shares that are paid up by shareholders
What are outstanding share payments that are demanded called?
Called-up shares
What are subscriber shares?
Shares first purchased by its members
What is share capital?
1) Subscriber shares
2) Further shares issued after incorporation
What is allotment?
When a person acquires unconditional right to be included in register of members
What is issue of shares?
Once shareholder formally registered to register of members and title has been complete
What are main different classes of shares?
Ordinary shares and preference shares
Shareholders liability is limited to what?
Total nominal value of shares held
What is a PSC?
1) Owns more than 25% of shares
2) Has power to appoint / remove majority of directors
3) Exercises significant influence over company
How many minimum directors of private company?
One
How many minimum directors of public company?
Two
Minimum age for directors?
16
Can you have one director that is just a company?
Atleast one is a natural person
What are types of directors?
1) Executive directors
2) Non-executive directors
3) Shadow directors
4) Alternate directors
5) De-facto directors
What is executive director?
Both officer and employee - e.g. Finance Director
What is non-executive director?
Not an employee - does not take part of day-to-day running
What is shadow director?
Directs shareholders even if not in register (does not count those acting in professional capacity)
What is alternate director?
Attends board meetings and acts in director’s place if they cannot attend (approved by board of director)
What are de-facto directors?
Someone who assumes to act as director but not been validly appointed and therefore not a legal director
How is one appointed director?
Ordinary resolution or by decision of directors
Who determines director service contract?
The board
How is a director service agreement approved?
Board resolution
When might shareholder approval be needed for service agreement?
If long term service contract
What is a long term service contract?
1) Guaranteed term for more than two years
2) Option to renew after 1 year counts
3) Invalid without shareholder approval
