Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Business Law & Ethics Expert

problem 1: Safe and Sound Ltd is a public company whose business is the manufacture and sale of home security systems. 

Only 100,000 shares have been issued: Kate Smith and her sister Sarah each hold 30,000 "A" class shares; their mother owns 10,000 "A" class shares; their brother, Jim, owns 5,000 "A" class shares; and their other brother, Rob owns 25,000 "B" class shares.  Jim, Kate and Sarah are the company's directors.

The company adopted the replaceable rules of the Corporations Act in its constitution, which also contains the following provision:

"The "B" class shares carry with them the right to be paid a 12% dividend before any payment of dividend is made to "A" class shareholders, in any financial year".

The company has traded successfully for a number of years.  Indeed, in January 1998 its "A" class shares were independently valued as being worth $100 each, and its "B" class shares as being worth $150 each.  Recently, however, Rob has become concerned with the way in which his sisters are managing the company.  He fears they are not paying sufficient attention to their duties, and that the company is sliding into debt.  Rob accuses his sisters of "bumbling incompetence" at a family gathering one Sunday afternoon, and a blazing row ensues. The sisters storm out muttering "once a trouble-maker, always a trouble-maker!"

Over the page are four problems on which Rob seeks your advice. ANSWER ALL of four problems (PARTS A-C) giving full reasons for your answers and referring to relevant cases and statutory provisions where appropriate.

Part A: Rob demands from the directors copies of the company's financial records for the current financial year. His request is refused.

What rights does Rob have to the information requested, and how can he enforce those rights?

Part B: Rob has now received notice of an extraordinary general meeting to be convened in one month's time. The notice informs him that certain motions will be proposed at the meeting. They are:

a) That a dividend of 20% be declared and paid to holders of the "A" class shares and no dividend be paid to "B" class shareholders.

b) That a new provision be inserted into the company's constitution to the effect that "B" class shares are to carry no right to vote at company meetings.

c) That a gift of $10,000 to Calum and Alexander (Kate and Sarah's husbands) be approved.

Rob wishes to contest all three motions in any way that he can. Consider each motion individually, and advise Rob of the legality of each motion and his rights to challenge each, if passed.

Part C: Rob later receives a notice from the company advising that the extraordinary general meeting referred to in Part B has been cancelled. However, shortly after, he also receives notice of another extraordinary general meeting to be convened in 14 days time.  At that meeting, the following resolution will be proposed:

"That all 'B' class shares be cancelled, and that the holders of those shares be paid $1.00 per share as compensation"

Rob seeks your advice as to whether he can challenge the resolution if it is passed.

Business Law & Ethics, Finance

  • Category:- Business Law & Ethics
  • Reference No.:- M91445

Have any Question? 


Related Questions in Business Law & Ethics

Write a 1050- to 1400-word paper on successful community

Write a 1,050- to 1,400-word paper on successful community problem solving. Identify a specific problem in your community that has been solved through a law enforcement initiative. If possible, base your paper on an inte ...

1- chris goes into best computer store looking for a new

1- Chris goes into Best Computer store looking for a new computer. He wants something that is top of the line and portable. After looking over everything in the store and talking to Pierre, Chris decides on a 1.3 kilogra ...

Crime and criminologycriminology studies criminal behavior

Crime and Criminology Criminology studies criminal behavior in society. Criminal behavior is behavior that breaks criminal codes established by our society. In a well-constructed, one page essay (400+ words), discuss the ...

Problem solving in your communityproblem - oriented

Problem Solving in Your Community Problem - oriented policing emphasizes police solving problems in their communities. Write a 2 page paper.  Address the following in your paper: Explain a problem in your community and h ...

There were many topics mentioned discussed and considered

There were many topics mentioned, discussed, and considered in this unit as well as previous units, regarding corrections, especially prisons. In a well-developed research paper, you are to choose one of the three option ...

Visit the united states consumer product safety commission

Visit the United States Consumer Product Safety Commission website. Click on Recalls. Choose one product that has been recalled. 1. Describe the product subject to recall, including the recall date, recall number, and th ...

It is common knowledge that two controversial issues in the

It is common knowledge that two controversial issues in the American legal system are the types of criminal defenses and the manner of criminal punishment. In this assignment, you will explore both in their various forms ...

1 what factors should be considered when doing a

1. What factors should be considered when doing a cost-benefit analysis of a proposed study? 2. What is the purpose of the Institutional Review Board? 3. When is it not necessary to obtain informed consent?

Question 1 the seller can recover the purchase price for

Question 1 The seller can recover the purchase price for the goods only under certain circumstances, including when: The buyer accepts, but fails to pay for the goods. The goods are destroyed after risk of loss passes to ...

Below is a fictitous act i need to use to answer the

BELOW IS A FICTITOUS ACT I NEED TO USE TO ANSWER THE QUESTION  The Importation of Prohibited Substances Act 2012 (Cth) is fictitious. In June 2012, the Commonwealth Parliament passed the Importation of Prohibited Substan ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

WalMart Identification of theory and critical discussion

Drawing on the prescribed text and/or relevant academic literature, produce a paper which discusses the nature of group

Section onea in an atwood machine suppose two objects of

SECTION ONE (a) In an Atwood Machine, suppose two objects of unequal mass are hung vertically over a frictionless

Part 1you work in hr for a company that operates a factory

Part 1: You work in HR for a company that operates a factory manufacturing fiberglass. There are several hundred empl

Details on advanced accounting paperthis paper is intended

DETAILS ON ADVANCED ACCOUNTING PAPER This paper is intended for students to apply the theoretical knowledge around ac

Create a provider database and related reports and queries

Create a provider database and related reports and queries to capture contact information for potential PC component pro