To win over proxy wars (in the case of takeover bids), where the corporate board or equity holders meetings are exposed to proxy wars, the directors have to adopt strategies based on the steps given below: Collection of material information Construction of proxy fight team Mass contact with shareholders Board of Directors of a company while facing a takeover bid have to work hard to defeat such a bid. Therefore they should collect all possible information about the affairs of their own company, competitors, the takeover — bidder and the opponents. Particularly the management of a company with small holdings on their board face stiff problem. In that case the only remedy is to allow board members to increase shareholdings. To face the opponents, the board must use all the material information available for their defense. The proxy fight team includes experts and persons of experience to help the management Continue reading
Business Law
Laws governing merger in India
Various Laws governing merger in India are as follows: 1. Indian Companies Act, 1956 This has provisions specifically dealing with the amalgamation of a company or certain other entities with similar status. The most common form of merger involves as elaborate but time-bound procedure under sections 391 to 396 of the Act. Powers in respect of these matters were with High Court (usually called Company Court). These powers are being transferred to National Company Law Tribunal (NCLT) by companies (second Amendment) Act, 2002. The Compromise, arrangement and Amalgamation/reconstruction require approval of NCLT while the sale of shares to Transferee Company does not require approval of NCLT. Sec 390 This section provides that “The expression ‘arrangement’ includes a reorganization of the share capital of the company by the consolidation of shares of different classes, or by the division of shares into shares of different classes, or by both these methods” Sec Continue reading
Classification of Negotiable Instruments
Negotiable instruments continue to hold a significant place in business because they are the primary means of payment and the way that trade obligations are fulfilled. It is crucial to remember that using negotiable instruments to send and receive payments has become much more common in today’s society. Negotiable instruments is defined as any transferable document that ensure the payment of a specified sum of money to the party mentioned on the document, either under duress or at a specified time. The Negotiable Instruments Act 1881, for instance, governs the rules pertaining to negotiable instruments in India. Upon the transfer of the negotiable instruments also called negotiation of the instrument, the holder in due course acquires the full legal responsibility to the instrument. Indeed, the negotiable instruments can either be transferred by either delivery or by endorsement and delivery. Classification of Negotiable Instruments 1. Inland Instrument A promissory note, bill Continue reading
Contingent Contracts
A contract may be unconditional or absolute on the one hand and conditional or contingent on the other. The absolute or unconditional contract is one without any reservations or conditions and is to be performed under any event. On the other hand, conditional or contingent contract is one in which a promise is conditional and the contract shall be performed only on the happening or not happening of some future uncertain event. The event must be collateral to the contract. The condition may be precedent or subsequent. For example, goods are sent on approval, the contract is a contingent contract depending on the act of the buyer to accept or reject the goods. According to the section 31 of the contract Act 1872, “A Contingent contract is a contract to do or not to do something, if some event, collateral to such contract, does or does not happen.” A Contingent Continue reading
Statutory Meeting of a Company
Statutory Meeting is the first meeting of the shareholders of a public company. It must be held within a period of not less than one month nor more than 6 months from the date at which the company is entitled to commence business. It is held only once in the lifetime of a company. A private company and a company limited by guarantee and not having a share capital need not hold such a meeting. The purpose of the statutory meeting with its statutory report is to put the shareholders of the company in possession of all the important facts relating to the new company, what shares have been taken up, what moneys received etc. This also provides an opportunity to the shareholders of meeting to discuss the whole situation, the management and prospects of the company. The Board of Directors must, atleast 21 days before the day on which Continue reading
Legal Aspects of Marine Insurance
A contract of marine insurance is a contract whereby the insurer undertakes to indemnify the insured, against marine losses, that is to say, the losses incidental to marine adventure. It is a contract of indemnity. It is a contract ‘uberrimae fidei”. It must have insurable interest. The doctrine of subrogation applies to it. Read More: Marine Insurance Marine Insurance Claims Marine Adventure: There is a marine adventure when; Any ship, goods or movable property(i.e. insurable property) is exposed to maritime perils; The earning or acquisition of any freight, passage money, commission, profit or other pecuniary benefit, or the security for any advances, loans or disbursements is endangered by the exposure of insurable property to maritime perils; Any inability to a third party maybe incurred by the owner of, or other person interested in, insurable property by reason of maritime perils. ‘Insurable property’ means any ship, goods or other movables which Continue reading