GUIDE TO THE MEMORANDUM OF INCORPORATION
GUIDE TO THE MEMORANDUM OF INCORPORATION GUIDE TO THE MEMORANDUM OF INCORPORATION
●●The MOI may also insert any provisions restricting or limiting the authorityof the board with respect to the issuing of capitalisation shares ascontemplated in section 47 (1) of the Act;(6) The authority of the Company’s Board of Directors to approve theissuing of any authorised shares of the Company as capitalisationshares, to issue shares of one class as capitalisation shares in respectof shares of another class, and to resolve to permit shareholders toelect to receive a cash payment in lieu of a capitalisation share, as setout in section 47(1) –................. is not limited or restricted by this MOI;................. is limited or restricted to the extent set out in Part C ofSchedule 2;Section 47(1) – except to the extent that the MOI provides otherwise,the board may by resolution approve the issuing of any authorisedshares of the company as capitalisation shares on a pro rata basis to theshareholders of one or more classes of shares. Shares of one class maybe issued as capitalisation share in respect of shares of another class andwhen resolving to award a capitalisation share the board may at the sametime resolve to permit any shareholder entitled to receive such an awardto elect to instead receive a cash payment at a value to be determinedby the board – subject to subsection 2 – which states that the board musthave considered the solvency and liquidity test on assumption that everyshareholder would elect to receive cash and is satisfied that the companywould meet the test after the distribution);●●The MOI may also insert any provisions relating to the issue of shares andtheir format – which can either be in uncertificated form or certificated formas the Board may determine;(7) Securities of the Company are to be issued –................. in uncertificated form, as contemplated in Section 49(2)(b);................. in either certificated or uncertificated form, as the Board maydetermine;2.2 Debt InstrumentsThe MOI may provide that : –(1) The authority of the company’s board of directors to authorise thecompany to issue secured or unsecured debt instruments as set out insection 43 (2) – is either:................. not limited or restricted by this MOI;................. is limited or restricted to the extent set out in Part D ofSchedule 2;(2) the authority of the company’s board of directors to grant specialprivileges associated with any debt instruments to be issued by thecompany as set out in section 43(3) is either:................. not limited or restricted by this MOI, or................. is limited or restricted by the MOI and if the latter, then to theextent set out in Part D of Schedule 2;22
For example, the MOI might set out additional privileges associated with adebt instrument relating to attending and voting at general meetings andthe appointment of directors or allotment of securities, redemption by thecompany or substitution of the debt instrument for shares of the company,provided that the securities to be allotted or substituted in terms of anysuch privilege are authorised by or in terms of the MOI in accordance withSection 36;2.3 Registration of beneficial interestsThe MOI may provide that : –●●The authority of the company’s board of directors to allow the company’sissued securities to be held by, and registered in the name of, one personfor the beneficial interest of another person, as set out in section 56(1) –is either:................. not limited or restricted by this MOI, or................. is limited or restricted by the MOI and if the latter, then to theextent set out in Part E of Schedule 2;Refer to Definitions on page 38 for definition of beneficial interest;ARTICLE 3 – SHAREHOLDERS3.1 Shareholders’ right to informationIn addition to the rights to access information set out in section 26(1), everyperson who has a beneficial interest in any of the Company’s securities has thefurther rights to information, if any, set out in Part A of Schedule 2 of this MOI;Refer to Table C on page 42 Access to Information;3.2 Shareholders’ authority to act(1) If, at any time, there is only one shareholder of the Company, the authorityof that shareholder to act without notice or compliance with any otherformalities, as set out in section 57(2), is not limited or restricted bythis MOI;(2) The default provision would state that if at any time every shareholder ofthe company is also a director as contemplated in Section 57(4) [seeTable G page 45] the authority of the shareholders to act without notice orcompliance with any other internal formalities as set out in that section isnot limited or restricted by the MOI.The MOI could however state that such authority is restricted or limited andset these out in Part A of Schedule 3 – in which case the formal processesrequired or protocol for shareholders would need to be set out clearly.refer to Table G on page 45 (leniency);23
- Page 3 and 4: CONTENTSNotes on the guide to draft
- Page 5 and 6: 1. OVERVIEW OF LEGISLATIONThe Act w
- Page 7 and 8: SHAREHOLDER AGREEMENTS[Schedule 5,
- Page 9 and 10: Regulation 31(3):Form CoR 31 (Notic
- Page 11 and 12: Any order of court in terms of the
- Page 13 and 14: ●●It may thus incorporate “re
- Page 15 and 16: ●●●●●●If a rule has bee
- Page 17 and 18: ●●Form CoR 15.1E - Long Standar
- Page 19 and 20: It may state that such authority is
- Page 21 and 22: Applicable sections in the Act:Sect
- Page 23: ................. does not apply wi
- Page 27 and 28: 3.7 Record date for exercise of sha
- Page 29 and 30: The Notice of meeting to shareholde
- Page 31 and 32: Note: the minimum % of 50% will how
- Page 33 and 34: NOTE: Section 66(4)(b) - A profit c
- Page 35 and 36: (5) Conduct of meetings:The authori
- Page 37 and 38: (ii) for wilful misconduct or breac
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- Page 41 and 42: pre-existing company means a jurist
- Page 43 and 44: Table BRELATED AND INTER-RELATED PE
- Page 45 and 46: Table DSOLVENCY AND LIQUIDITY TESTS
- Page 47 and 48: Table GLENIENCY RE GOVERNANCE FOR C
- Page 49 and 50: g) approve a decision of the board
- Page 51: CONTACT DETAILS:National:Gauteng (C
●●The MOI may also insert any provisions restricting or limiting the authorityof the board with respect to the issuing of capitalisation shares ascontemplated in section 47 (1) of the Act;(6) The authority of the Company’s Board of Directors to approve theissuing of any authorised shares of the Company as capitalisationshares, to issue shares of one class as capitalisation shares in respectof shares of another class, and to resolve to permit shareholders toelect to receive a cash payment in lieu of a capitalisation share, as setout in section 47(1) –................. is not limited or restricted by this MOI;................. is limited or restricted to the extent set out in Part C ofSchedule 2;Section 47(1) – except to the extent that the MOI provides otherwise,the board may by resolution approve the issuing of any authorisedshares of the company as capitalisation shares on a pro rata basis to theshareholders of one or more classes of shares. Shares of one class maybe issued as capitalisation share in respect of shares of another class andwhen resolving to award a capitalisation share the board may at the sametime resolve to permit any shareholder entitled to receive such an awardto elect to instead receive a cash payment at a value to be determinedby the board – subject to subsection 2 – which states that the board musthave considered the solvency and liquidity test on assumption that everyshareholder would elect to receive cash and is satisfied that the companywould meet the test after the distribution);●●The MOI may also insert any provisions relating to the issue of shares andtheir format – which can either be in uncertificated form or certificated formas the Board may determine;(7) Securities of the Company are to be issued –................. in uncertificated form, as contemplated in Section 49(2)(b);................. in either certificated or uncertificated form, as the Board maydetermine;2.2 Debt InstrumentsThe MOI may provide that : –(1) The authority of the company’s board of directors to authorise thecompany to issue secured or unsecured debt instruments as set out insection 43 (2) – is either:................. not limited or restricted by this MOI;................. is limited or restricted to the extent set out in Part D ofSchedule 2;(2) the authority of the company’s board of directors to grant specialprivileges associated with any debt instruments to be issued by thecompany as set out in section 43(3) is either:................. not limited or restricted by this MOI, or................. is limited or restricted by the MOI and if the latter, then to theextent set out in Part D of Schedule 2;22
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