A formal, legal constitution which
governs a company is called memorandum or memorandum of association. It is the
document that governs the relationship between the company and outsiders.
Ø Memorandum
of a company limited by shares
(a)The
memorandum shall state-
·
The name of the company, with
"limited" as the last word in its name;
·
The address of the registered office;
· The objects of the company, and, except in
the case of trading companies, the territories to which they extend;
·
Liability of the members is limited;
·
The amount of share capital with which the
company proposes to be registered, and the divisions of the share capital among
members;
(b)Each subscriber of the memorandum shall take at least one share;
(c)Each subscriber shall write opposite to his name the number of shares
he takes.
Ø Memorandum
of a company limited by guarantee
(a)The
memorandum shall state-
·
The name of the company, with
"limited" as the last word in its name;
·
The address of the registered office;
· The objects of the company, and, except in
the case of trading companies, the territories to which they extend;
·
Liability of the members is limited;
·
Each member contributes to the assets if
there occurs the necessity of investment or liability occurs one year after
yards and have to pay the amount incurred for liability also have to bear the
charges during winding up or dissolution of the business.
(b)If the company has a share capital-
·
The amount of share capital with which the
company proposes to be registered, and the divisions of the share capital among
members;
·
Each subscriber of the memorandum shall take
at least one share;
·
Each subscriber shall write opposite to his
name the number of shares he takes.
