Memorandum of Association — SPCC STD 11 Commerce — Question

Liability Clause: On the basis of kind of liability the companies can be classified into three classes:
(1) Company limited by shares (2) Company limited by guarantee (3) Limited liability company (1) Promoters clarify in this clause that the liability of its members is limited. In such companies members cannot be called on to pay more than the nominal value of their shares.
(2) In company limited by guarantee, the members liability will be up to the extent of the guarantee offered by them.
(3) In case of one person company the name of the person who in the event of death of the subscriber shall be nominated the members of the company.
(4) To create trust in shareholders and investors and to raise capital easily, resolution can be passed and Directors and Managing Director’s liability can be made unlimited.