Charles Mac Naughten Sir Francis Beaufort Palmer.

Company precedents for use in relation to companies: subject to ..., Volume 2 online

. (page 133 of 152)
Online LibraryCharles Mac Naughten Sir Francis Beaufort PalmerCompany precedents for use in relation to companies: subject to ..., Volume 2 → online text (page 133 of 152)
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either directly or indirectly in payment of any commission, discount, or allowance,
to any person in consideration of his subscribing or agreeing to subscribe, whether
absolutely or conditionally, for any shares of the company, or procuring or agreeing
to procure subscriptions, whether absolute or conditional, for any shares iu the
company, whether the shares or money be so applied by being added to the pur-
chase money of any property acquired by the company or to the contract price of
any work to be executed for the company, or the money be paid out of <^e nominal
purchase money or contract price, or otherwise.

• (3.) But nothing in this section shall affect the power of any company to pay
such brokerage as it has heretofore been lawful for a company to pay.

JPrcspcetus,
' 9. — (1.) Every prospectus issued by or on behalf of a company or in relation to Filing of
any intended company shall be dated, and that date shall, imless ^e contrary be prospectus,
proved, be taken as the date of publication of the prospectus.

(2.) A copy of every such prospectus shall be signed by every person who is
named therein as a director or proposed director of the company, or by his agent
authorized in writing, and shall be filed with the registrar on or before the date of
its publication.

. (3.) The registrar shall not register any prospectus unless it is so dated and
Bi£^n€d. No prospectus shall be issued until so filed for registration, and every pro-
spectus shall state on the face of it that it has been so filed.

10. — (1.) Every prospectus issued by or on behalf of a company, or by or on Spedfio reqmre-
behalf of any person who is or has been engaged or interested in the formation of ^"^^ ^ ^ .
the compaBy, must state- SS^SSS

(a) the contents of the memorandum of association, with the names, descriptions, ^^

and addresses of the signatories, and the numb^ of shares subscribed for
by them respectively ; and the number of founders or managemeut shares,
if any, and the nature and extent of the interest of the hol£rs in the pro-
perty and profits of the company ; and

(b) the number of shares, if any, &ced by the articles of association as the quali-

fication of a director, and any provision in the articles of association as to
the remimeration of the directors ; and ^

. ^0^ the names descriptions and addresses of the directors or proj^osed directors ; and
(d) the minimum subscription on which the directors may proceed to allotment,
and the amount payable on application and allotment on each share ; and
in the case of a second or subsequent offer of shares, the amount offered for
subscription on each previous allotment, and the amount actually allotted ;
and the amount, if any, paid on such shares ; and



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1036 Appendix A.

(e) the nmnber and amount of shares and debentores issued, or agreed to he issued,

as f ullj or partly paid np otherwise than in cash, and in the latter case the
extent to whioh they are so paid np, and in eiUier ease the ooosideratioii
for which such shares or debentures haye been issued or are proposed or
intended to be issued ; and

(f) the names and addresses of the vendors of any property purchased or acquired

by the company, or proposed so to be puronased or acquired, which is to be
paid for wnolly or partly out of the proceeds of the issue offered for
subscription by the prospectus, or the purchase or acquisition of whioh has
not been completed at tne date of publication of the prospectus, and the
amount payable in cash, shares, or debentures, to the vendor, and where
there is more than one separate vendor, or the company is a sub-purchaser,
the amount so payable to each vendor ; and

(g) the amount (if any) paid or payable as purchase money in cash, shares, or

debentures, of any such property as aforesaid, specifying the amoant
payable for goodwill ; and

(h) the amount (if any) paid or payable as oonmiission for subscribing nr agreeing
to subscribe, or procuring or agreeing to procure subscriptions, for any
shares in the company, or the rate of any such commission ; and

(i) the amount or estimated amount of preliminary expenses ; and

(j) the amount paid or intended to be paid to any promoter and the oonsideratioa
for any such pajrment ; and

(k) the dates of and parties to every material contract, and a reasonable time and
place at which any material contract or a copy thereof may be inspected :
Provided that this requirement shall not apply to a contract entered into in
the ordinary course of the business carried on or intended to be carried on by
the company, or to any contract entered into more than three years before
the date of publication of the prospectus ; and

S) the names and addresses of the aiulitors (if any) of the oompany ; and
n) full particulars of the nature and extent of the interest (if any) of eveiy
director in the promotion of or in the property proposed to be acquired by
the company, with a statement of aU sums piud or agreed to be paid to
him in cash or shares by any person either to qualify him aa a director or
otherwise for seryices rendered by him in oonnection with the formation of
the oompany.
(2.) For the purposes of this section every person shall be deemed to be a vendor
who iias entered into any contract, absolute or conditional, for the sale or purdiase,
or for any option of purchase, of any property to be acquired l^ the oompany, in
any case where —

(a) the purchase money is not fully paid at the date of publication of the pro-

spectus; or

(b) the purchase money is to be paid or satisfied wholly or in part out of the

proceeds of the issue offered for subscription by the prospectus ; or

(c) the contract depends for its validity or fulfilment on the resiUt of such is



(3.) Where any of the property to be acquired by the oompany is to be taken on
lease, this section shall apply as if the expression ** vendor '' included the lessor,
and the expression ** purchase money " included the oonsideration for the lease, and
the expression ** sub-purchaser '' included a sub-lessee.

(4.) This section shall not apply to a circular or notioe inviting existing memben
or debenture holders of a company to subscribe for further shiures or debentures,
but, subject as aforesaid, this section shall apply to any prospectus whether iasoed
on or with reference to the formation of a company or subsequently : Provided that—

(a) the requirements as to the memorandum of association, and the qualifioatioii,

remuneration, and interest of direcftors, the names, descriptions, and
addresses of directors or proposed directors, and the amount or estimated
amount of preliminary expenses, shall not apply in the case of a p rospect us
published more than one year after the date at whioh the oompany is
entitled to commence business ; and

(b) in the case of a prospectus published more than one year after the date at

which the company is entitled to commence business, the obligation to

disclose aU material contracts shall be limited to a period of Hro years

immediately preceding the publication of the prospectus.

(5.) Any condition requiring or binding an^ applicant for shares or debentures to

waive compliance with any requirement of this section, or purporting to affect him

with notioe of any contract, document, or matter not speoifioally r e fer red to in the

prospectus, shall be void.



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The Companies Act, 1900. Act of 1900 1037

' (6.) Where any such prospectus as is mentioned in this section is published as a
newspaper advertisement, it shall not be necessary to specify the contents of the
memorandum of association or the signatories thereto, and the number of shares
subscribed for by them.

(7.) In the event of non-compliance with any of the requirements of this section,
a director or other person responsible for the prospectus shall not incur any liability
by reason of the non-compliance, if he proves that —

(a) as regards any matter not disclosed, he was not cognisant thereof ; or

ib) the non-compliance arose from an honest mistake of fact on his part.
Vovided that in the event of non-compliance with the requirements contained in
parag^ph (m) of sub-section (1) of this section no director or other person shall
mcur any liability in respect of such non-compliance unless it be proved that he had
knowledge of the matters not disclosed.

(8.) Nothing in this section shall limit or diminish any liability which any person
may incur under the general law apart from this section.

11. A company shall not prior to the statutory meeting vary the terms of a Bestriciion
contract referred to in the prospectus, except subject to the approval of the statutory on fdteration
meeting. of terms

Statutory Meeting, mentioned in

- ^ prospectus.

12. — (1.) Every company Umited bv shares and registered after the commence- _.
ment of this Act shall, within a period of not less than one month nor more than ■''^t statutory
three months from the date at which ihe company is entitled to commence business, ™©®tmg of
hold a general meeting of the members of the company, which shall be called the ^^V^^J*
statutory meeting.

(2.) The directors shall, at least seven days before the day on which the meeting
is held, forward to every member of the company a report certified by not less than
two directors of the company, or, where there are less than two directors, by the
sole director and manager, stating : —

(a) the total number of shares allotted, distingfuishing shares allotted as fully or

partly paid up otherwise than in cash, and stating in the case of shares
partly paid up the extent to which they are so paid up, and in either case
the consideration for which they have been allotted ;

(b) the total amount of cash received by the company in respect of such shares,

distinguished as aforesaid ;

(c) an abstract of the receipts and payments of the company on capital account to

the date of the report, and an account or eetmiate of the preliminary
expenses of the company ;

(d) the names, addresses, and descriptions of the directors, auditors (if any),

manager (if any), and secretarv of the company ; and

(e) the particulars of any contract, the modification of which is to be submitted

to the meeting for its approval, together with the particulars of the modi>
fication or proposed modification.

(3.) The report shall, so far as it relates to the shares allotted by the company,
and to the cash received in respect of such shares, and to the receipts and payments
of the company on capital account, be certified as correct by the auditors, if any, of
the company.

(4.) The directors shall cause a copy of the report, certified as by this section
required, to be filed with the registrar forthwith after the sending thereof to the
members of the <x)mpany.

(5.) The directors shall cause a list showing the names, descriptions, and
addresses of the members of the company, and the number of shares held by them
respectively, to be produced at the commencement of the meeting, and to remain open
and accessible to any member of the company during the continuance of the meeting.

(6.) The members of the company present at the meeting shall be at liberty to
discuss any matter relating to the formation of the company, or arising out of the
report, whether previous notice has been given or not, but no resolution of which
notice has not been given in accordance with the articles of association may be passed.

(7.) The meeting may adjourn from time to time, and at any such adjourned
meetmg any resolution of which notice has been given in accordance with the
articles of association, either before or subsequently to the former meeting, may be
passed, and the adjourned meeting shall have the same powers as an original meeting.

(8.) If default is made in Sing su(^ report as aforesaid or in holding the
statutory meeting, then, at the expiration of fourteen davs after the last day on
which the meetlDg ought to have been held, any shareholder may petition the
Court for the winding up of the company, and upon the hearing of the petition
the Court may either direct that the company be wound up, or give directions for

P. 3x



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1038



Appendix A.



Extra-
ordinary



meeting.



Begpistration
of mortgages
and charges,
p. 462



the report being filed or a meeting being held, or make snoh otber order as may be
jnst, and may order that the costs of the petition be paid by any persons who in
the opinion of the Court are responsible for the default.

13. — (1 .) Notwithstanding anything in any regulations of a company, the directors
of a company shall, on the requisition of the holders of notices than one-tenth of the
issued capital of the company upon which all calls or other sums then due have been
paid, form with proceed to conyene an extraordinary general meeting of the company.

(2.) The requisition must state the objects of the meeting, and must be signed by
the requisitionists and deposited at the office of the company, and may ccmsist at
several documents in like form each signed by one or more requisitionists.

(3.) If the directors of the company do not proceed to cause a meeting to be held
within twenty-one days from the date of the requisition being so deposited, the
requisitionists, or a majority of them in ralue, may themselyes conyene the meeting,
but any meeting so conyened shall not be held after three months from tiie date of
such deposit.

(4.^ If at any such meeting a resolution requiring confirmation at another
meeting is passed, the directors shall forthwith convene a further extraordinary
general meeting for the purpose of considering the resolution and, if thought fit, ot
confirming it as a special resolution ; and, if the directors do not conyene the
meeting within seven days from the date of the passing of the first resolationf the
requisitionists, or a majority of them in value, may themselves convene the meeting.

(5.) Any meeting convened under this section by the requisitionists shall be
convened m the same manner, as nearly as possible, as that in which meetings are
to be convened by directors.

Mortgagn (md Charges,

14.— (1.) Every mortgage or charge created by a company after the commence-
ment of this Act and being either —

fa^ a mortgage or charge for the purpose of securing any issue of debentures ; o^

(b) a mortgage or charge on uncalled capital of the company ; or

(c) a mortgage or char^ created or evidenced by an instrument which, if

execute by an individual, would require registration as a bill of sale ; or

(d) a floating charge on the undertaking or property of the company,

shall, so far as any security on the company's property or undertakmg is thereby
conferred, be void against the liquidator and any creditor of the company, unless
filed with the regibtrar for registration in manner required by this Act within
twenty-one days after the date of its creation, but without prejudice to any
contract or obligation for repayment of the money thereby secured.

(2.) Where the mortgage or charge comprises property outside the United
Kingdom, it shall, so far as that property is concerned be sufficient compliance with
the requirements of this section, if a deed purporting to specifically charge such
property be reg^tered notwithstanding that further procee£ngs may be necessary
to make such mortgage or charge valid or effectual according to the law of im
country in which such property is situate.

(3.) The registrar shall keep, with respect to each company, a register in the
prescribed form of all such mortgages and charges created by the company after the
commencement of this Act, and requiring registration under this section, and shall,
on payment of the prescribed fee, enter in the register, with respect to every such
mortgage or charge, the date of creation, the amount secured by it, short
particulars of the property mortgaged or charged, and the names of the mortgagees
or persons entitled to the charge.

(4.) Provided that where a series of debentures containing any diarge to the
benent of which the debenture holders of that series are entitled pari passu is
created by a company, it shall be sufficient to enter on the register —

faj the total amount secured by the whole series ; and

(b) the dates of the resolutions creating the series and of the covering deed, if
any, by which the security is created or defined ; and

fc) a general description of the property charged ; and

rd) the names of the trustees, if an^, for the debcaiture holders.

(6.) Where more than one issue is made of debentures in the same series, the
company may require the reg^trar to enter on the register the date and amount of
any particular issue, but an omission to do this shall not affect the validity of the
debentures issued.

(6.) The registrar shall give a certificate under his hand of the r^^tration of any
mortgage or charge registered in pursuance of this section, stating the amount
thereby secured (which certifioate shall be conclusive evidence that the requirements



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The Companies Act, 1900. Act of 1900 1039

of ihifl section as to registration have been oomplied -with], and the oompany shall
cause a copy of the certificate so given to be endorsed on every debenture or certificate
of debenture stock which is issued by the oompany, and we payment of -which is
secured by the mortgage or charge so registered.

(7.) It shall be the duty of the company to register every mortgage or charge
created by the company and requiring' registration under this section, and for that
purpose to supply tne registrar with tne particulars required for registration ; but
any such mortgage or charge may be registered on the application of any person
interested therein.

(8.) The register kept, in pursuance of this section, of the mortgages and charges
of each company shall be open to inspection by any person on payment of the
prescribed fee, not exceeding one shilling for each inspection.

(9.) Every company shall cause a copy of every instrument creating any mortg^age
or charge requinng registration under this section, to be kept at the registered
office of the company, and to be open to inspection by the members and oreditorB of
the oompany on payment of such fee, not exceeding one shilling for each inspection,
as may be fixed by the regulations of the company. Provided that in the case of a
series of uniform debentures a copy of one such debentare shall be sufficient.

15. A judge of the High Court, on being satisfied that the omission to register Bectification
a mortgage or charge within the time required by this Act, or the omission or mis- of register,
statement of any particular with respect to any such mortgage or charge, was
accidental, or due to inadvertence or to some other sufficient cause, or is not of a

nature to prejudice the position of creditors or shareholders of the company, or that
on other grounds it is just and equitable to g^nt relief may, on the application of
the oompany or any person interested, and on such terms and conditions as seem to
the judg^ just and expedient, order that the time for registration be extended, or,
as the case may be, that the onrntsion or misstatement be rectified.

16. The registrar may, on evidence being given to his satisfaction that the debt Entry of
for which aoy registered mortgage or charge was g^ven has been paid or satisfied, satisfaction,
order that a memorandum of satisfaction be entered on the register, and shall if

required furnish the company with a copy thereof.

17. The r^strar shaU keep a chronological index, in the prescribed form and with Index to
the prescribed particulars, to the mortg^ag^ or charges reg^tered under this Act. reg^ters of

18. If any company makes default in complying with the requirements of this mortgages
Act as to the reg^tration of any mortgage or charge created by the company, the and cnarg^.
company and every director, manag^er, and other officer of the company, who
knowingly and wilfully authorised or permitted such default shall, without

prejudice to any other liability, be liable on summary conviction to a fine not Penalties,
exceeding one hundred pounds ; and if any person knowingly and wilfully authorises
or permits the delivery of any debenture or certificate of debenture stock required
by this Act to be registered, without a copy of the certificate of the registrar being
endorsed upon it, he shall, without prejudice to any other liability, be liable on
summary conviction to a fine not exceeding one hundred pounds.

Annual Summary.

19. — (1.) The summary mentioned in section twenty-six of the Companies Act. Annual

1862, shall be so framed as to distinguish between the shares issued for cash and summary,

the shares issued otherwise than for cash or only partiy for cash, and shall, in 25 & 26 Vict,

addition to the particulars required by tiiat section to be specified, also specify — ^ gg

(a) the total amount of debt due from the oompany in respect of all mortgages

and charges which require regfistration under this Act, or which would
require such registration if created after the commencement of this Act ; and

(b) the names and addresses of the persons who are the directors of the company

at the date of the summary.

(2.) The list and summary mentioned in the said section twenty-six must be
sigrned by the manager or by the secretary of the company.

20. Sections forty- five and fortv-six of the Companies Act, 1862, shall apply to AiMndmentof
companies having a capital divided into shares, and the words ** and not having a ^ * ^^2s?ie.
capita divided into shares " in those sections shall be repealed. ' * ^

AudU.

81. — (1.) Every oompany shall at each annual general meeting appoint an auditor Appointment
or auditors to hold office until the next annual general meeting. oiauditors.

(2.) If an appointment of auditors is not made at an annual general meeting, the
Board of Tnie may, on the application of any member of the company, appomt an
auditor of the company for the current year, and fix the lemuneration to be paid
to him bj tiie oompany for his servioee.

3x2



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1040



Appendix A.



Bemuneration
of aaditors.

Bights and
duties of
aaditors.



AppliQAtion of
83 & 34 Vict
o. 104, 8. 2.
p. 888

Amendment of
26*26 Vict
0. 80, B. 138, aa
to applicationB.
p. 748

Amendment of
law as to
striking names
of defunct
companies off



48 Vict. 0. 19.



Provisions as
to companies
limited by
guarantee.



Penalty
for false
statement.



(3.) A director or officer of the company shall not be capable of being app<Mnt6d
anditor of the company.

(4.) The first auditors of the company may be appointed by the direotoirs before
the statutory meeting, and if so appointed shall hold office until the first annual
general meeting, unless previously removed by a resolution of the shareholden in
general meeting, in which case tiie shareholders at such meeting may appointauditors.

(6.) The directors of a company may fill any casual vacancy in the office ci
auditor, but while any such vacancy continues the surviving or continuing auditor
or auditors, if any, may act.

22. The remuneration of the auditors of a company shall be fixed by the company
in general meeting, except that the remuneration of any auditors appointed before
the statutory meeting, or to fill any casual vacancy, may be fixed by the direotars.

23. Every auditor of a company shall have a right of access at all times to the
books and accounts and vouchers of the company, and shall be entitled to require
from the directors and officers of the company such information and explanation as
may be necessary for the performance of the duties of the auditors, and the auditors
shall sig^ a certificate at the foot of the balance sheet stating whether or not all
their requirements as auditors have been complied with, and sbUl make a repwt to
the shareholders on the accounts examined by them, and on every balance sheet
laid before the company in g^eral meeting during their tenure of office ; and in
eveiy such report shall state whether, in their opinion, l^e balance ^eet ref erred to
in the report is properly drawn up so as to exhibit a true and correct view of the
state of the company's affairs as shown by the books of the company ; and Both.
report shsdl be read before the company in general meeting.

Winding up*

24. The provisions of section two of the Joint Stock Companies Arrangement
Act, 1870, shall apply not only as between the company and uie creditors, or any



Online LibraryCharles Mac Naughten Sir Francis Beaufort PalmerCompany precedents for use in relation to companies: subject to ..., Volume 2 → online text (page 133 of 152)