HELP WITH DEFINITIONS AND TERMS - Corporate Law

[emb_23]

Hey just wanting some help with some legal terms and definitions in regards to Australian Corporate Law (I am really anal about having correct definitions). I have more to come but start with:

• Class Rights (stock)
• Distribution Rights - Interim and final (Stock)
• Partly paid share: What exactly is this? and what does it mean by a shareholder is obliged to contribute further if a "call" is made?
• What does it mean by cancelling shares? In my lecture they spoke about ceasing to become a member (of a company) by transferring their shares I assume that essentially means selling and trading but then it continues to say or have them (their shares) cancelled?
• Royal Charter: They talk about the formation of an incorporated entity by special act of parliament (e.g ASIC) or by Royal Charter
• What does outsize partnership refer to? refer to s115 Corps. Act 2001
• Incorporated v. corporated in australia
• A company limited by guarantee: I understand it is a company in which members' liability is limited to the amount they have agreed to contribute to the company's assets if wound up; but If someone could elaborate further that would be great maybe a brief theoretical example of what actually happens?
• Also a brief theoretical example of what occurs in an Unlimited company
• Also is it correct to say that A no Liability company is essentially only a company restricted to mining activities?

Thanks!!

[ninwa]

As far as I can remember we don't actually learn most of that stuff in corporations law, you might have been better off posting this in the commerce forums.

Company limited by guarantee: You are correct. This kind of company does not have share capital and the members are not required to contribute capital while the company is in operation.

Not sure what you mean by example but most charitable and not-for-profit companies will be registered as public companies limited by guarantee. My notes also say that some sporting clubs will be registered as such as well - I guess those "old boys" golf clubs will often be full of rich people willing to guarantee the club in case it fails?

Unlimited company: Say the company has 10 shareholders. It has $1 million of assets and $11 million debt. It is wound up, after liquidating all of its assets it has $10 million debt remaining. Each shareholder is liable for $1 million.

Say the same company has $1 million of assets but only $1.5 million debt. It is wound up and after all assets are liquidated still owed $500k to creditors. Each shareholder is liable for $50k.

No liability: yep only for mining companies (and only exists in Australia) for policy reasons - mining companies generally have more difficulty in raising funds through issuing shares because a lot of mining activity is very speculative and so shareholders were less willing to invest, or did so under false names so they wouldn't be potentially liable if some mining venture turned out to be a flop because there were actually no minerals in that area or whatever. This is why Parliament created the no liability category so as to encourage shareholders to actually invest in mining companies.