Business and Corporate Law

Running Head: Business and Corporate Law 1
Title
Assignment Name
Student Name
Course Name and Number
Professor Name
Date:

2
Running Head: Business and Corporate Law
Contents
Question 1...............................................................................................................................3-4
Question 3...............................................................................................................................4-6
Question 5...............................................................................................................................6-7
Conclusion..............................................................................................................................7-8
References................................................................................................................................9

3
Running Head: Business and Corporate Law
Question 1
In the light of the facts given Kara, Adrian, Barbara and Adrian have agreed on the following
as -:
1) Two directors to be appointed- Kara and Adrian
2) Both the Directors will also be engaged as employees.
3) One hundred fifty shares @ $2000 each to be issued.
4) Adrian and Barbara purchase 25 shares each, and Karl and Kara purchase 50 shares
each and profits and losses will be borne in the proportion of their shareholding.
Now, the Corporation Act, 2001 under Section 112 provides for types of companies. It
provides for two types of companies, i.e. “Proprietary Company and “Public Company”. A
“Proprietary Company” is furthermore classified into “Limited by shares” and “Unlimited
with share capital” and on the other hand “Public Company” is further classified into “limited
by share” “Limited by guarantee” and “Unlimited with share capital” and “No liability
company”. The characteristics of both types of companies make them different from each
other (Corporations Act, 2001, 2017). The basis of the difference between two types of companies
is in the strength of members and Directors and the number of employees.
Proprietary Company has following features-:
1) Section 113 of the Corporation Act, 2001 provides that company to be registered as a
proprietary company shall not have more than 50 employees as shareholders
("CORPORATIONS ACT 2001 - SECT 113Proprietary companies", 2019). In the given
proposition, Kara and Adrian are appointed as Directors as well as employees and
Barbara and Karl are employees who are also the shareholders. Hence, the proposed