What happens when you forfeit your shares in a company?
What are forfeited shares? These are shares that are lost by a member (or shareholder) of a publicly listed company for failure to pay any outstanding sums regarding them. How are shares forfeited? The Companies Act, 2015 allows companies to forfeit shares, in accordance with their Articles of Association, for failure by any shareholder to […]
How can you manage risk in corporate governance?
Corporate Governance is a system by which companies are managed and controlled. Shareholders who appoint the board of Directors to manage and control the company, the board comes up with accountable mechanisms that suit the company’s management system and apply it. One of these mechanisms is on how to manage risk, in a company. Risks […]
Duties of a Manager in a Limited liability Partnership
A manager is defined as any person who is concerned in or takes part in the management of the Limited Liability Partnership (“LLP”). The Limited Liability Partnership Act, 2011 states that every LLP must have at least one manager who is a natural person of at least eighteen years and is ordinarily resident in Kenya. […]
How to motivate your employees by creating class B shares
Most companies have only one class of shares, ordinary shares, but it is possible for even small private companies to have different share classes. Different classes of shares often have different voting, dividend and/or capital rights. Sometimes this is done to attract a particular investor, e.g. by giving them preference shares. In other cases, shares […]
Categories of shares in a company
The Companies Act (2015) defines “shares” in the following diverse ways: (a) in relation to an undertaking with a share capital, means shares in the share capital of the undertaking; (b) in relation to an undertaking with capital but no share capital, means rights to share in the capital of the undertaking; and (c) in […]
What happens when you surrender your shares?
WHAT HAPPENS WHEN YOU SURRENDER YOUR SHARES? What are surrendered shares? Surrendered shares are shares that have been voluntarily returned to a company by the registered shareholder of those shares. In that, surrendering shares is the transfer of allotted shares back to the company that issued them. When should shares be surrendered? The Companies Act […]
Are you about to enter into a foreign contract of service?
What is a Foreign Contract of Service? A foreign contract of service is a contract that is made in Kenya, but whose services are to be performed either wholly or partly outside Kenya.The employer requiring services under such a contract can be a Kenyan based organization or a foreign company based in Kenya which has […]
Registration of a simple trust in Kenya
I. INTRODUCTION A trust can be defined as a legal relationship that exists between a settlor (creator of the trust) and trustee (a protector of the trust) and a beneficiary. It is important to note that the parties to a trust can either be individuals or legal entities. In this trust arrangement, the settlor transfers […]
The Advantages of Having a Shareholders’ Agreement
The Advantages of Having a Shareholders’ Agreement A shareholders’ agreement is a formal agreement between all or some of the shareholders in a company. A shareholder agreement is usually considered alongside the company’s articles of association, which defines the relationship between the shareholders and is in law considered a contract inter se between the shareholders. […]
Why Corporate Governance Experts Recommend specially designed articles of association for your Start Up
Why Corporate Governance Experts Recommend specially designed articles of association for your Start Up Introduction The articles of association (AoA) are basically regarded as the “constitution of a company.” They outline the rules and regulations that stipulate a company’s internal affairs. The articles of association are also considered a user’s manual for an organization that […]
