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members, or within one year afterwards, for payment of debts, &c. contracted before they ceased to be members, and of the expenses of winding-up. (See Forms B and C, Cl. 427 and 429).
Note. In all companies where the capital is divided into shares, each member must take at least one, and must write opposite to his name the number of shares he takes. (S. 14.)
THE ARTICLES OF ASSOCIATION.
Although a form of Articles of Association is given in Schedule A of the " Act," yet any of the clauses comprised therein may be adopted, omitted or modified, as may best suit the convenience of the proposed company; and if it is limited by shares, it may even go a step further, and register no articles at all (S. 14); but in that case, it will be bound and regulated by the articles above mentioned, just the same as if they had been attached to the "Memorandum" on registration (S. 15).
It is, however, compulsory in the case of a company limited by guarantee, or unlimited, to register articles of association with the "Memorandum" (S. 14).
In preparing the articles, the following requirements must be strictly complied with; viz.
1. To divide the contents into separate paragraphs,
2. If unlimited or limited by guarantee and capital
The company's solicitor will of course advise as to the form and also as to the expediency of adopting or rejecting any of the Clauses contained in the regulations given by the "Act," (See Table A, Cl. 406,) and resolutions should be passed accordingly at the meeting before referred to. 16. It will have been seen that up to the present time the proposed company is not placed under the slightest restriction. There is no limitation as to the disposal of its shares or scrip,
nor in fact as to anything else connected with its provisional
17. It is perfectly free to do as its Directors think fit, and may receive deposits, allot shares, and enter into contracts. But it must be borne in mind that this freedom only exists as long as the undertaking remains unregistered, for in a legal point of view it is not a company at all until that takes place; neither do the allotees become members until after such incorporation, unless they have signed the Memorandum and Articles of Association.
If, therefore, the Articles of Association have not been prepared and attached to the "Memorandum" at the time of issuing the Prospectus to be left for the inspection of intending shareholders, as is most frequently the case, they should now be drawn up and executed without further delay. The next step will be to have them registered with the Memorandum of Association, and to have the necessary fees paid-for particulars of which see the following Clauses.
Take the Memorandum of Association with the Articles annexed (if any), to the Registrar of Joint Stock Companies, Serjeants' Inn, pay the necessary fees according to the following scale, (quoted in Cl. 21 and 22,) and he will give you in return a certificate that the company is duly registered.
See Registration Office, Cl. 359 to 362.
Care must be taken that the company does not register under a name identical with that by which a subsisting company is already registered, or so nearly resembling the same as to be calculated to deceive, unless such existing company is being wound up and testifies its consent thereto. Should it occur, however, through inadvertence or otherwise, that a company is so registered, it may change its name with the sanction of the Registrar, who will enter the new name on the register and issue a fresh certificate of incorporation; but no such alteration shall in any way affect the company's rights or obligations, or render invalid any legal proceedings commenced by or against it (S. 20.)
See Cl. 33, 109, and 110, as to change of name by special resolution, where the effect is precisely the same as to legal proceedings, &c.
The following is a list of fees payable on registration, (extracted from Table B in the first Schedule to the "Act,") and applies only to such companies as have a capital divided into shares
Where nominal capital does not exceed
If exceeding £2,000, the above fee of
For registering any necessary document
For making a record of any fact required
The following is a list of fees, (extracted from Table C in
the first Schedule to the "Act,") payable by companies not having a capital divided into shares.
Where the number of members as stated
in the Articles of Association does not
Where the number of members exceeds
100, but it is not stated to be un-
Where the number of members is stated
For registration of any existing com-
5 0 0
20. 0 0
0 5 0
0 5 0
0 5 0
THE ADMINISTRATION OR MANAGEMENT.
THE effect of registration (S. 18), and obtaining the Registrar's certificate thereof, is most important. A comparatively disorganised mass is instantly raised to the dignity of a body corporate, by the name contained in the Memorandum of Association, having perpetual succession and a common seal. It may forthwith exercise all the functions of an incorporated company-commence business, and proceed to carry out the objects for which it was formed. The certificate is, so to speak, its licence; and is moreover held to be conclusive evidence that the requisitions of the "Act," in respect of registration, have been fully complied with.
Any company may hold an unlimited quantity of land, except only where it has been formed for the purpose of promoting any charitable or scientific object, in which case it is restricted to two acres (S. 21), but may hold more on obtaining the sanction of the Board of Trade.
The first matter to be attended to before a company commences its operations, is the selection of a requisite number of books; and it is impossible to bestow too much care in having them framed in accordance with the most approved forms. With a view to doing justice to this most important part of the administration, it has been deemed desirable to devote the whole of Part III. to its consideration; and the reader is therefore referred to Cl. 116 to 135 for any information he may require.