Memorandum

&
Articles Of Association
 “Contents”

• Memorandum of Association
• Memorandum Clauses.
• Alteration of Memorandum.
• Doctrines of Ultra Vires.
• Articles of Association
• Definition
• Contents of Articles.
• Alteration Of Articles.
• Difference Between MOA & AOA.
“Memorandum
Of Association”
“Memorandum Of Association”
 Why Memorandum?
 Share Holders.
 Creditors.
 Definition [Sec. 2(28)]
“Memorandum means Memorandum of
Association of a Company as originally
framed or as altered from time to time in
pursuance of any previous Company law
or of the Companies Act of 1956.”
 “Memorandum Clauses”
Name clause

Association Clause Registered Office clause

MOA

Object Liability Clause

Clause

Capital Clause
“Name Clause” [Sec. 13(1)(a)]

 Undesirable name to be avoided.

 Injunction if identical name adopted.
 Limited or Private limited as the last
words of the name.
 Prohibition of using certain names
and symbols.
“Registered Office Clause” [Sec 3(1)(b)]

 Every company should have it’s Fixed

Office.
 Notice of the situation of the Office
within 30 days of incorporation.
“Object Clause” [13(1)(c)(d)]

 Object both defines and confines the

powers of Company.
 Useful for both Share holders and
Creditors.
“The Capital Clause”[Sec 13(4)(a)]

 Fixed share capital with which the

Company is to be installed.
 Fixed capital with which it is
registered is called “Registered
Capital”.
“The Liability Clause” [Sec. 13(2)]

 Company limited by Shares or by

Guarantee shall also state the liability
of its members.
 If the number of members falls below
the statutory minimum, then the
members who are a part of the
company are responsible for the
debts.
“The Association Clause” [13(4)(c)]

 We the persons whose names and

addresses are incorporated in the
Memorandum, agree to take the
number of Shares in the Capital.
“Alteration Of Memorandum Of Association”

 Change Of Name.
 Change of Registered Office.
 Alteration of Objects.
 Change in Liability Clause.
 Change in capital.
 “Doctrine of Ultra Vires”
• Ultra = “Beyond” & Vires = “Power”.

• Ultra Vires the Company.

• Ultra Vires the Directors.
• Ultra Vires the Articles.
“Articles Of
Association”
“Articles of Association[sec.2(2)]”

 Definition:-
“The Articles of Association of a company
as originally framed or as altered from
time to time in pursuance of this Act,
including so far as they apply to the
Company, the regulations contained in
Table A in Schedule I annexed to this
Act”
“Properties of AOA”

 Next important to Memorandum of

Association”

 Must not violate the Memorandum

and the Act .
“Content of Articles”
 Share Capital &Variation  Alteration of Share
of rights. Capital
 Lien of Company on  General Meeting
Shares.  Proceedings at general
 Calls on shares meetings.
 Share Certificate  Notes by members.
 Transfer of Shares  Board of Directors and
 Transmission their Powers.
 Forfeiture of Shares  Capitalization.
 Conversion of Shares  Winding Up.
with Stocks
 Share warrants
“Application of AOA”
 Unlimited Companies.
 Companies limited by Guarantee.
 Having share Capital.
 Do not have Share Capital.
 Private Company.
 Restricting number of members.
 Right to transfer of Shares
 Prohibition of any Public involvement.
“Alteration Of Articles”
 Must not be inconsistent with the Act.
 Must not Conflict with Memorandum
 Must not sanction anything illegal.
 Must be benefit for the company.
 Must not increase Liability of Members.
 Alteration by Special resolution.
 Approval of Government when Public
Company is converted into Private
company.
 “MOA”
 It is the Charter of the
company indicating the
nature of its Business.
 It defines the Scope of the
Activities of the Company.
 It being the Charter of the
Company is the “Supreme
Document”
 Every Company Must have
its own Memorandum.
 There are strict Restrictions
on its alteration.
 Ultra wires the
Memorandum is wholly
void.
“AOA”
 They are regulations for the
internal management of the
Company.
 They are the rules for
carrying out the Objects of
the company.
 They are Subordinate to the
Memorandum.
 A company limited by
shares need not have
Articles of its own. Table A
 Can be altered by Special
resolution.
 Ultra Vires the Articles can
be confirmed.