Section Section 12 (2). The report,(tt) which the directors are required by section 12 to forward to every member of a company and to file with the registrar, is a report required by and for the purposes of this Act," mily as state- hence any person wilfully making therein a statement false in any material particular will be guilty of a misdemeanor by virtue of section 28 of the present Act. fully false ment in the report sent to members. Section 12 (2 (a)). Section 12 (2 (c)). Meaning of "capital account" be inserted in report. For the meaning of the expression "paid up otherwise than in cash" see supra (p. 15) the note on "the meaning of payment in cash" appended to section 4 (2). Clause (c) requires the report to contain an abstract of the receipts and payments of the company " on capital account," as distinguished from revenue account. The function of the capital account is to show, how the capital of the company has been expended.(u) It will not, it is conceived, be necessary that this report should state the sums received and paid by the company in the ordinary course of its business from the date, at which it commenced business, until the date of the report, as the Revenue (and not the Capital) account would be the proper account to deal with such receipts and payments. The words "on capital account appear to have been inserted in clause (c) for the very purpose of excluding the sums received and paid in the ordinary course of business; had the Legislature intended these sums to be included in the abstract specified in clause (c), the words " capital account" would not, it is submitted, have been inserted. For the meaning of the expression "preliminary expenses" see supra note on 10 (1 (i)). on Section 12 The names of the auditors (if any) must be mentioned in the (2 (d)). When auditor's report to be forwarded to every member of the company before name need not the first statutory meeting; and such report is required by section 12 (3) to be certified as correct by the auditors, if any, of the company. No auditors need be appointed until the first statutory meeting is held (see infra section 21) and, if no auditor has been appointed, such report cannot, of course, state the name of the auditors of the company or be certified as correct by them. Section 12 Section 11 of this Act provides, that a company shall not vary the terms of any contract referred to in a prospectus without contracts speci. obtaining the approval of the statutory meeting or any subsequent meeting. Subsection (1 (e)) of section 12 provides that, in order fied in prospec tus. (tt) For form of report, see infra App. II. Form VII. to obtain the approval of the statutory meeting, the particulars Section of any such contract, which it is intended to modify, shall be 12. set forth in the report forwarded to the members of the company before the holding of such meeting. The effect of filing this report with the registrar is to make it Section 12 (4). accessible to any member of the public.(v) "List of mem. first statutory It is not quite clear, whether the directors will satisfy the Section 12 (5). requirements of section 12 (5) of the Companies Act 1900 by bers to be producing at the statutory meeting the register of members, which produced at companies are by section 25 of the Companies Act 1862 required meeting. to keep, or whether it will be necessary to produce a separate "list showing the names, descriptions and addresses of the members of the company and the number of shares held by them respectively". However, having regard to the fact that such register of members contains all the information required to be supplied by "the list," it is submitted, that production of such register of members at the statutory meeting will satisfy the requirements of section 12 (5). All the members of a company have the report before them at Section 12 (6). least seven days before the holding of the statutory meeting and such a report may supply sufficient materials to enable any member to give notice of a resolution. The discussion at the statutory meeting may bring out facts, which render it desirable either to move a resolution for the adjournment of the meeting, or else to have another meeting summoned under the provisions of section 13 of this Act. Powers given meeting. As a general rule, the business, which can be transacted by an Section 12 (7). adjourned meeting, is confined to the business, which could have to adjourned been transacted at the original meeting; thus, unless proper notice of a resolution had been given for the original meeting, the resolution could not, as a rule, be moved at the adjourned meeting. Hence subsection 7 provides that, if the first statutory meeting is adjourned, the adjourned meeting shall have the same powers as the original meeting. If a meeting, which purports to be held pursuant to section 12 (1) Section 12 (8). Meeting held of the present Act, is held before the expiration of one month before the from the date, at which the company is entitled to commence business, such a meeting will, it is conceived, not be a statutory (v) See Companies Act 1862 sec. 174 (5). expiration of one month. 12. Section meeting and consequently the provisions of subsection (8) will come into operation at the expiration of 14 days after the last day, on which the first statutory meeting ought to have been held. As to when a company is entitled to commence business, see supra section 6 and the note thereon. Section 13. Extraordinary general meeting. 13. (1.) Notwithstanding anything in any regulations of a company, the directors of a company shall, on the requisition of the holders of not less than one-tenth of the issued capital of the company upon which all calls or other sums then due have been paid, forthwith proceed to convene an extraordinary general meeting of the company. (2.) The requisition must state the objects of the meeting, and must be signed by the requisitionists and deposited at the office of the company, and may consist of several documents in like form each signed by one or more requisitionists. (3.) If the directors of the company do not proceed to cause a meeting to be held within twenty-one days from the date of the requisition being so deposited, the requisitionists, or a majority of them in value, may themselves convene the meeting, but any meeting so convened shall not be held after three months from the date of such deposit. (4.) If at any such meeting a resolution requiring confirmation at another meeting is passed, the directors shall forthwith convene a further extraordinary general meeting for the purpose of considering the resolution and, if thought fit, of confirming it as a special resolution; and, if the directors do not convene the meeting within seven days from the date of the passing of the first resolution, the requisitionists, or a majority of them in value, may themselves convene the meeting. 13. (5.) Any meeting convened under this section by Section the requisitionists shall be convened in the same manner, as nearly as possible, as that in which meetings are to be convened by directors. 13. Provisions similar to those contained in section 13 were before Effect of section this Act inserted in almost all properly drawn articles of association and are contained in articles 32, 33 and 34 of Table A; the effect of this section is therefore to make provisions obligatory, which have hitherto been customary. The expression "month" used in section 13 (3) means calendar month.(x) MORTGAGES AND CHARGES. Registration of 14. (1.) Every mortgage or charge created by a section 14. company after the commencement of this Act and mortgages and being either (a) a mortgage or charge for the purpose of securing any issue of debentures; or (b) a mortgage or charge on uncalled capital of the company; or (c) a mortgage or charge created or evidenced by an instrument which, if executed by an individual, would require registration as a bill of sale; or (d) a floating charge on the undertaking or property of the company, shall, so far as any security on the company's property or undertaking is thereby conferred, be void against the liquidator and any creditor of the company, unless filed with the registrar for registration in manner required by this Act within twenty-one days (x) See 52 & 53 Vic. cap. 63 sec. 3. charges. 14. Section after the date of its creation, but without prejudice to any contract or obligation for repayment of the money thereby secured. (2.) Where the mortgage or charge comprises property outside the United Kingdom, it shall, so far as that property is concerned, be sufficient compliance with the requirements of this section, if a deed purporting to specifically charge such property be registered notwithstanding that further proceedings may be necessary to make such mortgage or charge valid or effectual according to the law of the country in which such property is situate. (3.) The registrar shall keep, with respect to each company, a register in the prescribed form of all such mortgages and charges created by the company after the commencement of this Act, and requiring registration under this section, and shall, on payment of the prescribed fee, enter in the register, with respect to every such mortgage or charge, the date of creation, the amount secured by it, short particulars of the property mortgaged or charged, and the names of the mortgagees or persons entitled to the charge. (4.) Provided that where a series of debentures containing any charge to the benefit of which the debenture holders of that series are entitled pari passu is created by a company, it shall be sufficient to enter on the register (a) the total amount secured by the whole series and (b) the dates of the resolutions creating the series and of the covering deed, if any, by which the security is created or defined; and |