Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

QUESTION 5 Maria and Simon are the two directors of XYZ Systems Ltd, a computer systems applications company. Together they own 75% of the shares

QUESTION 5

Maria and Simon are the two directors of XYZ Systems Ltd, a computer systems applications company. Together they own 75% of the shares of the company. The rest of the shares of the company are divided between Molly (8%), Bart (5%), Rita (10%) and Suzie (2%).

Maria and Simon are very excited about the software that has been developed by their company. They believe that it will revolutionise the market. They decide to sell the software considerably below market price to M&S Pty Ltd, a company they control. M&S Pty Ltd uses the software and as predicted, the software is a hit and their business flourishes.

  1. Can the directors enter into such a transaction and have they breach any of their duties?

  1. What can a shareholder do in respect of such breaches of director's duty? What are the remedies available to the shareholder?

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Environmental Law And Policy

Authors: James Salzman, Barton Thompson Jr.

5th Edition

1683287908, 978-1683287902

More Books

Students also viewed these Law questions

Question

Given p = 30-3q what price would make demand unitary elastic?

Answered: 1 week ago

Question

What is a residual plot?

Answered: 1 week ago

Question

Mortality rate

Answered: 1 week ago

Question

Armed conflicts.

Answered: 1 week ago