State and explain the main contents/clauses of articles of association. |
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| Ans : Articles of association is the document of internal management of the company. It contains rules, regulation and bylaws of the company. For it’s systemic management. This document is sub-ordinate to memorandum of association. It defines the relationship between the company and it’s member. A limited company either private or public has to prepare article of association along with other documents for incorporation. Once the article of association is written it is difficult to bring changes in it. Therefore, it should be written very carefully. Finally, it is signed by the members as in memorandum of association for official validity in presence of minimum one witness.
Contents of Articles of Association
i) Name and address of the company
ii) Authorized capital of the company
iii) Objective of the company
iv) Liabilities of the shareholders
v) Name and address of the promoters (for the public limited company seven and private limited company one)
vi) Number of board of director and their tenure
vii) Number of minimum share to be the board of director
viii) Remuneration (salary), facilities and commission of the board of directors
ix) Procedure of general meeting
x) Qualification and required qualities for the board of director
xi) Methods of appointing employees
xii) Right and duties of board of directors
xiii) About provision of board of directors meeting
xiv) Method of issuing the shares
xv) Provision relating to calls on share and for feature of shares
xvi) Provision relating to transfer of shares
xvii) Appointment of Company Secretary
xviii) Uses of the company seal
xix) Bank account and signature
xx) Method of keeping book of account
xxi) Method of auditing and name and address of auditor
xxii) Provision of raise loan and debenture
xxiii) Emalgamation (Marging) of the company
xxiv) Conversion of private limited company to public limited company
xxv) All the matter of memorandum of association
xxvi) Such other necessary of association according to law of government and Nepal Company Act 2063 BS
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