Memorandum & Articles Of Association

“Contents” • Memorandum of Association • Memorandum Clauses. • Alteration of Memorandum. • Doctrines of Ultra Vires.

• Articles of Association • Definition • Contents of Articles. • Alteration Of Articles.

• Difference Between MOA & AOA.

“Memorandum Of Association”

“Memorandum Of Association”  Why Memorandum?  Share Holders.  Creditors.

 Definition [Sec. 2(28)] “Memorandum means Memorandum of Association of a Company as originally framed or as altered from time to time in pursuance of any previous Company law or of the Companies Act of 1956.”

“Memorandum Clauses” Name clause Association Clause

ed Office clause

MOA Liability Clause

Object Clause Capital Clause

“Name Clause”

[Sec. 13(1)(a)]

 Undesirable name to be avoided.  Injunction if identical name adopted.  Limited or Private limited as the last words of the name.  Prohibition of using certain names and symbols.

“ed Office Clause” [Sec 3(1)(b)]

 Every company should have it’s Fixed Office.  Notice of the situation of the Office within 30 days of incorporation.

“Object Clause”

[13(1)(c)(d)]

 Object both defines and confines the powers of Company.  Useful for both Share holders and Creditors.

“The Capital Clause”[Sec 13(4)(a)]  Fixed share capital with which the Company is to be installed.  Fixed capital with which it is ed is called “ed Capital”.

“The Liability Clause”

[Sec. 13(2)]

 Company limited by Shares or by Guarantee shall also state the liability of its .  If the number of falls below the statutory minimum, then the who are a part of the company are responsible for the debts.

“The Association Clause”

[13(4)(c)]

 We the persons whose names and addresses are incorporated in the Memorandum, agree to take the number of Shares in the Capital.

“Alteration Of Memorandum Of Association”

    

Change Of Name. Change of ed Office. Alteration of Objects. Change in Liability Clause. Change in capital.

“Doctrine of Ultra Vires” • Ultra = “Beyond”

& Vires = “Power”.

• Ultra Vires the Company. • Ultra Vires the Directors. • Ultra Vires the Articles.

“Articles Of Association”

“Articles

of Association[sec.2(2)]”

 Definition:“The Articles of Association of a company as originally framed or as altered from time to time in pursuance of this Act, including so far as they apply to the Company, the regulations contained in Table A in Schedule I annexed to this Act”

“Properties of AOA”  Next important to Memorandum of Association”  Must not violate the Memorandum and the Act .

“Content of Articles”  Share Capital &Variation of rights.  Lien of Company on Shares.  Calls on shares  Share Certificate  Transfer of Shares  Transmission  Forfeiture of Shares  Conversion of Shares with Stocks  Share warrants

 Alteration of Share Capital  General Meeting  Proceedings at general meetings.  Notes by .  Board of Directors and their Powers.  Capitalization.  Winding Up.

“Application of AOA”  Unlimited Companies.  Companies limited by Guarantee.  Having share Capital.  Do not have Share Capital.

 Private Company.  Restricting number of .  Right to transfer of Shares  Prohibition of any Public involvement.

“Alteration Of Articles”       

Must not be inconsistent with the Act. Must not Conflict with Memorandum Must not sanction anything illegal. Must be benefit for the company. Must not increase Liability of . Alteration by Special resolution. Approval of Government when Public Company is converted into Private company.

“MOA”      

It is the Charter of the company indicating the nature of its Business. It defines the Scope of the Activities of the Company. It being the Charter of the Company is the “Supreme Document” Every Company Must have its own Memorandum. There are strict Restrictions on its alteration. Ultra wires the Memorandum is wholly void.

“AOA”      

They are regulations for the internal management of the Company. They are the rules for carrying out the Objects of the company. They are Subordinate to the Memorandum. A company limited by shares need not have Articles of its own. Table A Can be altered by Special resolution. Ultra Vires the Articles can be confirmed.