CIMA Fundamentals of Ethics, Corporate Governance and Business Law BA4 Question # 101 Topic 11 Discussion

CIMA Fundamentals of Ethics, Corporate Governance and Business Law BA4 Question # 101 Topic 11 Discussion

BA4 Exam Topic 11 Question 101 Discussion:
Question #: 101
Topic #: 11

R, S and T are the only shareholders in RST Ltd each holding 5,000 ordinary £1 shares. R is the only director of the company. The articles of association of RST contain the following provisions:

1. R is to be a director of RST Ltd for life.

2. In the event of any resolution to dismiss R by ordinary resolution his votes shall count three times.

Which of the following is CORRECT?

(i) Provision 1 is void as a director cannot be appointed for a period exceeding 3 years.

(ii) Provision 2 is valid and R may outvote any proposed resolution to dismiss him.

(iii) Provisions 1 and 2 are both unenforceable by R as they are not ordinary membership rights.


A.

(i) only


B.

(ii) only


C.

(iii) only


D.

(i) and (iii) only


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