QUESTION 1

PART 1

Fab-Fabrics Ltd is a textile company that operates all over South Africa. The company secretary of Fab-Fabrics Ltd has recently resigned, and the following candidates are being considered for appointment:

Nylon (Pty) Ltd, a company specialising in providing company secretarial services. The company has two directors, Mr Denim and Mr Jeans. They are also the only two employees of Nylon (Pty) Ltd. Both Mr Denim and Mr Jeans have the requisite knowledge and experience to perform the duties of company secretary, and both are South African citizens.

Mr Suede, a resident of eSwatini, who has several years experience performing company secretarial services. He permanently resides in eSwatini, but he often undertakes business trips to South Africa.

Mrs Silk, a South African resident who holds the requisite knowledge and experience to perform the duties of company secretary. She has recently been declared delinquent to be appointed as a director of a company.

Miss Corduroy, the auditor in charge of the audit of Fab-Fabrics Ltd. The directors of Fab-Fabrics Ltd are however questioning the need for a company secretary and the position's purpose.

YOU ARE REQUIRED TO:

(a) Briefly explain the Companies Act requirements relating to the notice period for the resignation of a company secretary. (2)

(b) In terms of the Companies Act, discuss the eligibility of each of the listed candidates for appointment as company secretary. (7)

(c) In terms of the Companies Act, respond to the directors as to whether they may choose not to appoint a company secretary and list the company secretarys duties to explain to them the purpose of the position.