MRL2601 Assignment 2
(COMPLETE ANSWERS) Semester
1 2025 - DUE April 2025
QUESTION 1 1.1 Name the different types of
companies that are provided for in the
Companies Act 71 of 2008. (5) 1.2 Vela is a
shareholder of Impala Ltd. The next annual
general meeting will be held on 13 November
2023. Unfortunately, at the time he will be
overseas on a business trip. Vela would, however,
still like to vote on some matters that will be
discussed at the meeting. Advise him regarding
the possibility of appointing a proxy to attend
and vote on his behalf at the annual general
meeting. Also indicate the validity requirements
for appointment of a proxy. (5) TOTAL: [10 marks
1.1 Types of Companies Under the Companies Act 71 of 2008 (5 marks)
The Act recognizes the following types of companies:
1. Profit Companies – Companies that aim to make a profit. These include:
o (a) Private Companies (Pty Ltd) – Restrict the transfer of shares and limit the
number of shareholders.
o (b) Public Companies (Ltd) – Can offer shares to the public and are listed on
stock exchanges.
o (c) State-Owned Companies (SOC Ltd) – Owned by the government (e.g.,
Eskom SOC Ltd).
o (d) Personal Liability Companies (Inc) – Typically used by professionals (e.g.,
attorneys, accountants) where directors are jointly liable.
2. Non-Profit Companies (NPC) – Formed to serve public benefit or social causes,
without profit motives.
💡 Tip: Ensure you mention both categories (profit and non-profit) since the question asks
for different types.
, 1.2 Appointment of a Proxy for Shareholders (5 marks)
Under Section 58 of the Companies Act 71 of 2008, shareholders are entitled to appoint a
proxy to represent them at meetings. Here's what Vela needs to know:
1. Right to Appoint a Proxy:
o A shareholder may appoint any person as a proxy, who need not be a
shareholder.
o The proxy can participate, speak, and vote on behalf of the shareholder.
2. Validity Requirements for Proxy Appointment:
o The proxy appointment must be in writing, signed by the shareholder.
o The document must clearly state the name of the proxy and the specific
meeting the proxy is appointed for.
o The appointment is valid for one meeting or any adjournment thereof, unless
otherwise stated.
o Notice of the proxy appointment must be delivered to the company before the
meeting.
3. Voting Rights:
o Unless stated otherwise, the proxy has the same voting rights as the
shareholder.
o The shareholder may instruct the proxy on how to vote or allow the proxy to
vote at their discretion.
Example:
Since Vela will be overseas, he should sign a written proxy form appointing someone to
attend the AGM on 13 November 2023. The company’s memorandum of incorporation
(MOI) may specify the deadline for submitting the proxy form, so he should ensure
compliance.
(COMPLETE ANSWERS) Semester
1 2025 - DUE April 2025
QUESTION 1 1.1 Name the different types of
companies that are provided for in the
Companies Act 71 of 2008. (5) 1.2 Vela is a
shareholder of Impala Ltd. The next annual
general meeting will be held on 13 November
2023. Unfortunately, at the time he will be
overseas on a business trip. Vela would, however,
still like to vote on some matters that will be
discussed at the meeting. Advise him regarding
the possibility of appointing a proxy to attend
and vote on his behalf at the annual general
meeting. Also indicate the validity requirements
for appointment of a proxy. (5) TOTAL: [10 marks
1.1 Types of Companies Under the Companies Act 71 of 2008 (5 marks)
The Act recognizes the following types of companies:
1. Profit Companies – Companies that aim to make a profit. These include:
o (a) Private Companies (Pty Ltd) – Restrict the transfer of shares and limit the
number of shareholders.
o (b) Public Companies (Ltd) – Can offer shares to the public and are listed on
stock exchanges.
o (c) State-Owned Companies (SOC Ltd) – Owned by the government (e.g.,
Eskom SOC Ltd).
o (d) Personal Liability Companies (Inc) – Typically used by professionals (e.g.,
attorneys, accountants) where directors are jointly liable.
2. Non-Profit Companies (NPC) – Formed to serve public benefit or social causes,
without profit motives.
💡 Tip: Ensure you mention both categories (profit and non-profit) since the question asks
for different types.
, 1.2 Appointment of a Proxy for Shareholders (5 marks)
Under Section 58 of the Companies Act 71 of 2008, shareholders are entitled to appoint a
proxy to represent them at meetings. Here's what Vela needs to know:
1. Right to Appoint a Proxy:
o A shareholder may appoint any person as a proxy, who need not be a
shareholder.
o The proxy can participate, speak, and vote on behalf of the shareholder.
2. Validity Requirements for Proxy Appointment:
o The proxy appointment must be in writing, signed by the shareholder.
o The document must clearly state the name of the proxy and the specific
meeting the proxy is appointed for.
o The appointment is valid for one meeting or any adjournment thereof, unless
otherwise stated.
o Notice of the proxy appointment must be delivered to the company before the
meeting.
3. Voting Rights:
o Unless stated otherwise, the proxy has the same voting rights as the
shareholder.
o The shareholder may instruct the proxy on how to vote or allow the proxy to
vote at their discretion.
Example:
Since Vela will be overseas, he should sign a written proxy form appointing someone to
attend the AGM on 13 November 2023. The company’s memorandum of incorporation
(MOI) may specify the deadline for submitting the proxy form, so he should ensure
compliance.
