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Variation Of Class Rights
Corporate Law (BLAW20001)
University of Melbourne
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Variation of class rights
s124(1)(a): legal capacity & power of company s254A(1) power to issue (b)preference share
Ø Company
s198A(2): director can exercise the powers which is not required to exercise in the GM
i. 48 non-‐e s/h, issue 3 new shares => public company.
* s113(1): Pty Ltd no more than 50 non-‐employee s/h
Ø Directors
- Can the company issue shares?
a. Is there a variation of class rights?
Gree nhalgh v Ardene Cinemas
□ Actual legal rightshas been altered Company proposed to altered the actual legal rights attaching to the shares
□
White v Bristol Aeroplane Co
General law
Statutory 246Cdeemed variation (1)(2)(5)(6) b. If yes, What is the procedure? Constitution s246B(1) No constitution s246B(2)
Does it lead to a variation of class rights
Unfair prejudice? If proper procedure with class right varied .
a) Variation of cancellation of their rights Modification of the company's constitution to vary or cancel their rights
b)
member with > 10% votemay apply to the court to have the variation, cancellation or modification set aside.
246D(1): without unanimous support of class
246D(2): application must be made within 1 monthof variation 246D(5): court may set aside satisfied it would unfairly prejudice applicants
Variation Of Class Rights
Course: Corporate Law (BLAW20001)
University: University of Melbourne
