Ownership and Responsibilities in a Company

Who automatically becomes the first shareholders of the company according to the memorandum of association?

• Employees of the company

• Subscribers to the memorandum

• Customers of the company

• Directors of the company

What is the procedure for buying existing shares called?

• Share acquisition

• Share transfer

• Share purchase

• Share exchange

Why does a shareholder agreement not need to be made public?

• It is a government regulation

• It is a private contract

• It is compulsory

• It involves the company itself

What is NOT a benefit of a shareholder agreement?

• It binds all parties to the terms

• It must be made public

• Usual remedies for breach are available

• It can protect minority shareholders

What is a consequence of shareholders agreeing to how they might vote as directors?

• It strengthens their duties as directors

• It breaches their duties as directors

• It is a compulsory agreement

• It involves the company itself

Which of the following is a true statement about shareholder agreements?

• They are compulsory for all companies

• They are public documents

• They are private contracts

• They limit the company’s statutory duties

What is required for a company to amend its articles according to typical shareholder agreements?

• Consent of all parties

• Majority vote

• Board approval

• CEO decision

How are disputes between shareholders typically resolved?

• Court litigation

• Mediation

• Referred to arbitration

• CEO decision

What must a shareholder receive from the company within two months of allotment under S.769(1) CA 2006?

• Register of members

• Share certificate

• Key company documentation

• Director's service contract

What right does a new shareholder have regarding the register of members?

• To refuse registration

• To be entered in the register within two months of the transfer

• To demand a director's service contract

• To receive annual accounts