Answert the questions below

In another development. Magoro who holds 60% of the shares in the company and always attends meetings with other shareholders who own 40% of the shares, demanded that they discuss the sharing of dividends. While Magoro holds preference shares in the company. most of the other shareholders hold ordinary shares. Last week, the directors declared dividends at the Annual General Meeting. Magoro insisted on being paid first but this was vehemently opposed by the other shareholders who stated that in any case. he should be paid last or not at all. Magoro complained that last time the dividends were declared. he was never paid despite various demands. His colleagues have told him that he cannot be paid now because issues of last year were handled then and that was all. Magoro is not happy and needs your help. Required: Identify the legal issues involved and advise the parties accordingly. (20 marks) Question 5 (a) Describe the different types of debentures. (6 marks) (b) Explain the advantages of private companies limited by shares over unincorporated companies. (10 marks) (c) Describe the authorities responsible for appointment of a receiver under company law. (4 marks) (Total 20 marks) Question 6 (a) In relation to company law. explain the meaning of: (i) a promoter. (2 marks) (ii) shares. (2 marks) (b) Explain the general rules relating to pre-incorporation contracts. (8 marks) (c) Describe the types of share capital in company law. (8 marks) (Total 20 marks) Question 3 Pomp Company Ltd was incorporated in 2012. The promoters were Kodi. Linda. Mata. Opera and Panga. Opera and Panga were the majority shareholders and directors of the company. The memorandum of association provided that the objective of the company was to deal in iron sheets, nails and other items of similar nature or do any other activity incidental thereto. The articles of association provided that selling of shares will be subject to approval by the company and that burrowing in excess of Shs 30 million shall be sanctioned by the company. In June 2013. Opera and Panga obtained a loan of Shs 50 million from Zink Bank without presenting any company document. This decision had been verbally made by the duo while at a drinking joint. They used the money to engage. on behalf of the company. in business of buying and selling stationary of all kinds. When Kodi. Linda and Mata complained about the directors' engagement in activities outside the company mandate and threatened to sue the company for that matter, the directors reacted angrily, saying that the trio are minority shareholders and cannot question their ability to conduct the company affairs. Linda. Mata and Kodi felt they had no alternative but to start a side business. They opened a business of buying and selling nails and other hardware materials. Upon learning about this business. the directors of Pomp Company Ltd called for an extraordinary meeting. By majority, the company resolved to alter, and subsequently altered the articles of association to read among others, that "directors shall have power to buy shares of any member who competes with the company business". Linda. Kodi and Mata are puzzled and need your advice. Required: Raise and resolve the issues involved. (20 marks) Question 4 Ogosso Ltd is a private limited company incorporated in Uganda in 2009. The company has been engaged in various businesses in and outside Uganda but they have never filed any returns with the registrar of companies. Last week. when Hamilie, one of the shareholders. was reading the Companies Act 2012, in preparation for his CPA (U) examinations. he realised that the company was in trouble for failure to file returns. Hamilie looked at the provisions of the law relating to the filing of annual returns. He listed all the terms and compiled a balance sheet that he signed and hurriedly delivered to the registrar of companies. Question 2 Muzito. Kulepuka and Mulevu formed a partnership to deal in importation and selling of motorcycles in Uganda. Their business is based in Mwokya trading centre. The motorcycles are imported from Japan. Muzito sold the land which he inherited from his parents. He was trying to find out what business he could do with the money until he was advised by his cousin to open up a motorcycle business in Bukoto town. He opened up the business as advised. He did not know where to buy stock from. He decided to buy some motorcycles from the partnership business. He did the same for a long time and his business became famous in Bukoto. Muzito connived with Mulevu, a managing partner in charge of sales to always sell to him motorcycles at a discount. Mulevu would share the discounted amount with Muzito. 0n the other hand, Kulepuka who was in charge oi advertising the partnership business bought a loud speaker and mounted it on top of their shop. He would tune it to the loudest volume so that customers from tar can come and support their business. Musengo who operates a poultry business within the vicinity complained about the noise oi the loud speaker because it was aiiecting the production of his layers. He is threatening to sue Kulepuka ior nuisance. In another development Mukota, Kumara. Katoto. Mwisho, Kulesa. Padibu and Mweto formed a company dealing in the sale of hides and skins. Mukota and Kumara are directors of the company, were in charge of preparing and issuing of the prospectus. The company wanted more shareholders so that they could raise enough capital to run the business. Since people are not always interested in going into the business of hides and skins due to their smell. Mukota and Kumara decided to indicate in their prospectus that the company deals in leather business. Members of the public including Kasati were excited and bought shares knowing that the company was dealing in leather. It later transpired that the company was dealing in hides and skins. Kasati sold his shares at a loss of Shs 5 million. He is furious for having been misled to buy shares in the company and he is contemplating to take legal action. Required: Raise and resolve the issues involved. (20 marks)