Tag (SQ): Legal Implications

(a). What are the components of stated capital of a company with shares?

(b). What treatment does the Act provide for unclaimed dividends?

(c). State five items that distinguish preference shares from ordinary shares.

(d). Tawiah Limited has been in business for over twenty years now. It was a family company before a private placement with some strategic investors five years ago with the goal of expanding production and venturing into the export market. The result has been less than impressive, and investors are demanding action. In response, the Managing Director (MD) intends to pay dividends for the first time since the private placement using a fund meant for debt payments due next month. One of the investors proposed an amount for the dividend per share, and the MD agreed just to appease the investors.

(i) Can he go ahead with the dividend payment?

(ii) What are the implications, if any?