Secretarial practice

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Monograph

Identifikator:: 1828236004

URN:: urn:nbn:de:zbw-retromon-249926

Document type:: Monograph

Title:: Secretarial practice

Edition:: fourth edition

Place of publication:: Cambridge

Publisher:: W. Heffer & Sons Ltd

Year of publication:: 1930

Scope:: viii, 987 Seiten

Digitisation:: 2022

Collection:: Economics Books

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Document type:: Monograph

Structure type:: Chapter

Title:: Chapter IX. Other matters relating to shares

Collection:: Economics Books

# SECRETARIAL PRACTICE Every prospectus relating to the issue of the shares and every balance sheet issued subsequently to the issue at a discount must contain particulars of the discount allowed, or so much thereof as has not been written off [s. 47 (3)], and every annual return subsequent to the issue must contain particulars of the discount so far as not written off [s. 108 (3)]. Debentures may be issued ‘at a discount, unless the pro- visions of the memorandum or articles of association prevent it [re Compagnie Générale, Campbell's Case (1876), 4 Ch. D. 470; Webb v. Shropshire Railways Co. (1893), 3 Ch. 307]. But where debentures issued at a discount are exchangeable for fully-paid shares this may involve the issue of shares at a discount and such an issue of debentures would be illegal Mosely v. Koffyfontein Mines (1904), 2 Ch. 108]. Any discount or commission paid for placing debentures must be disclosed in a prospectus (s. 35 and the fourth schedule) or statement in lieu (s. 39 and the fifth schedule), and must appear in the Annual Summary (s. 108), and particulars must be given on registration of the debenture [s. 79 (9)]. Moreover, any such discount not written off must be stated in the balance sheet (s.44). The previously existing power of a company to pay brokerage is reserved by the Act [s. 43 (3)]. The power had been recognised in Metropolitan Coal Association v. Scrimgeour (1895), 2 Q.B. 604), where 2} per cent. was paid. The basis of the decision in the case quoted was that 21 per cent. was a reasonable remuneration for the work done by the brokers in placing shares. The decision is limited to work done by stockbrokers, but there appears to be no reason why similar brokerage should not be paid to any person or company who bond fide renders similar services. Commissions may be paid to individuals on the issue of specific shares, subject, of course, to the provisions of s. 43; but more commonly they are paid upon a large number of shares being underwritten. ‘An ‘“‘underwriting” agreement means an agreement entered into before the shares are brought before the public, that in the event of the public not taking up the whole of them, or the number mentioned in the agreement, the underwriter will, for an agreed com- mission, take an allotment of such part of the shares as the public has not applied for’ [per Cotton L.J., in Licensed Victuallers’ Association (1889), 42 Ch. D. 1, at p. 6]. The object of underwriting is thus to insure the subscription of the issue. The terms of underwriting are now usually embodied in a definite agreement, but sometimes the agreement takes the

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