Appendix 27

MATTERS THOUGH NOT REFERRED TO IN THE ACT, BUT BEING IMPORTANT, SHOULD BE INCLUDED IN THE ARTICLES

1. Re: Appointment of Managing Directors and Managers subject to section 197A. Once the provision for appointment of the above personnel is included in the Articles, no amendment will be necessary of the same, from time to time, when the appointment will be actually made.

2. Re: Capitalisation of Reserves and Issue of Bonus Shares as otherwise the company cannot do so.

3. Re: Payment of Interim Dividend by the Board of Directors. In absence of any provision in the Articles in this regard, interim dividend cannot be paid by the directors.

4. Re: Declaration of dividend in relation to any year by an Extraordinary General Meeting in addition to what has already been declared in the last Annual General Meeting. Unless the Articles so provide it has been held that such additional dividends cannot be declared.

5. Re: Deduction from dividend payable to any member, any sum of money payable by him to the company on account of calls or otherwise in relation to shares of the company.

6. Re: Right of the company to have first and paramount lien on shares for all moneys payable on those shares and to sell those shares.

7. Re: Appointment of directors by a third party.

8. Re: Appointment of Chairman for General Meeting and/or a Board Meeting.

9. Re: The exercise of certain specific powers of the Board subject to the restrictions, if any, contained in the Act and the Articles.

10. Re: Secrecy clause for directors, auditors, officers and employees to observe secrecy and not to reveal my of the matters which come to their knowledge in the discharge of their duty and sign a declaration in that regard.

11. Re: That whatever number of directors shall be present in the adjourned Board Meeting, that will form quorum. Otherwise, adjourned Board Meetings will not be validly held for want of usual quorum.

12. Re:  That directors shall be paid their travelling expenses etc. and sitting fees for attending adjourned Board Meetings also, in the similar way as they are paid for attending the original Board Meeting. Unless this is stated in the Articles, it is doubtful whether the directors can be so paid. Provision may also be made for payment to directors for travelling expenses for attending General Meetings of the company also.

13. Re: That the company or the Board shall be entitled to appoint director or directors not hable to retire subject to the limits prescribed under the Act. If this provision is not there in the Articles, such directors cannot be appointed without amendment of the Articles and with the permission of the Central Government each time. Appointment of such directors now‑a‑days is the common feature because of the terms of obtaining loans etc. from collaborators and/or financial institutions.

14. Re: That an alternate director need not acquire and hold qualification shares. As an alternate director is appointed for a temporary period in place of another director, he should not be required to hold such shares, but if the Articles require each director to hold such shares, he has to acquire those shares within the time prescribed, otherwise he cannot act unless the exemption from this is given to him under the Articles.

15. Re: That the Common Seal of the company may be made either of metal or of rubber as the directors may decide. this is because the Act is not clear on the point.

16. Re: That the contracts can he entered into with the company in which the company's directors may be interested subject to necessary disclosure and restrictions under the Act. Without this provision in the Articles, it has been held that directors cannot enter into contracts in which they are interested without the consent of the members each time because of their fiduciary position.

17. Re: Disclosure of promoters' interest should also be made and also of the reference to any agreement to be entered by the company with. them.

18. Re: Any special provision which the collaborators or the financing institution will require to be contained in the Articles should also be made.