LML4806 Assignment 2
(COMPLETE ANSWERS)
Semester 2 2024
What must be set out in a merger agreement - ANS-- new
MOI
- Name, ID number of directors
- Manner in which securities are converted
- Manner of payment of any consideration
- estimate cost of merger
- details of proposed allocati...
LML4806 Assignment 2
(COMPLETE ANSWERS)
Semester 2 2024
What must be set out in a merger agreement - ANS-- new
MOI
- Name, ID number of directors
- Manner in which securities are converted
- Manner of payment of any consideration
- estimate cost of merger
- details of proposed allocation of assets and liabilities
What happens when a company wants to issue new shares?
- ANS-- S39
- each SH has a right of pre-emption
- SH subscribe for new shares in proportion to their voting
right
- designed to alleviate the effects on existing SH of a new
issue of shares by a company
- rights should not be diluted w/o consent
- company MOI may limit, restrict or negate such pre-
emptive rights
Does business rescue proceedings allow company to
cancel contracts? - ANS-- S136(2) Business rescue
practitioner does not have power to cancel contract
, - BRP may apply to court to cancel entirely, partially or
conditionally any obligation of company on terms that are
just & reasonable in circumstances
- court may not cancel any provision of an employment
contract or an agreement to which s35A or 35B of Insolvency
Act would have applied, had company been liquidated
- Other party to contract that has been partially or entirely
cancelled may only claim damages from company & not for
specific performance of contract
Requirements for person to qualify as BRP? - ANS-- person
must not have any other relationship with company that
would lead a reasonable and informed 3rd party to conclude
that his integrity, impartiality or objectivity is compromised
by that relationship
- former directors of company = integrity compromised
What kind of insiders are there? - ANS-- ITO Financial
Markets Act, an insider who knows he has inside info & who
acts indirectly/directly through an agent for his own account
in securities on a regulated market to which inside info
relates, comments an offence (S78)
- Insider who knows info & who deals for any other person,
commits an offence
- Person who deals for an insider directly or indirectly
through an agent in securities listed on a regulated market to
which the inside info possessed by the insider relates or
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