Under Article 1 number 9 of Law Number 40 of 2007 on Limited Liability Company (“Company Law”) merger means a legal action which is taken by one or more companies to merge with another existing company with the result that the assets and the liabilities of the merging company is transferred by the law to the surviving company and thereafter the merging companies’ status as legal entities is terminated by the law.
Company in order to perform a merger should pay attention to the interest of:
- The company, minority shareholders, the companies’ employee;
- Creditors and other business partner of the company;
- The public and a healthy business competition.
Board of Director from each company that will perform merger should prepare the draft of merger plan. The draft of the merger plan, which has obtained the approval from the Board of Commissioners from each company, is proposed to the General Meeting of Shareholder (“GMS”) of each company in order to obtain its approval. Under Article 123 paragraph (2) of Company Law, it regulates that the draft of merger plan should at least contain of: Read the rest of this entry »
Companies’ authorized capital is divided into shares. Shares is a moveable goods which give rights to the owner to attend and to vote in the General Meeting of Shareholders (“GMS”), to receive the payment of dividends and the remaining asset as the result of liquidation, and also to perform other rights as set out under Law Number 40 of 2007 on Limited Liability Company (“Company Law”).
Under Article 56 of Company Law, it regulates that transfer of right of shares should be performed by a deed of transfer of right. Deed of transfer of right can be made before notary or with a privately drawn deed. The hardcopy of a deed of transfer of right and its copy should be delivered to the company. The Board of Directors is obliged to record the transfer of right of shares, the date and the day of the transfer of right of shares in the shareholders register or special register and inform about the changes of the composition of shareholders to the Minister to be recorded in the Company Register within the period of not later than 30 (thirty) days as from the date of transfer of rights.
In the Company’s article of association, the provision of transfer of rights can be regulated, such as: Read the rest of this entry »
Each issued share shall carry one vote, unless the articles of association determines otherwise. Shareholders either by their own or represented based on a power of attorney are entitled to attend the meeting and become the participants of GMS and to use their vote according to the number of shares they possess. Member of the Board of Directors, Member of the Board of Commissioners and employees of the company are prohibited from acting as a proxy of shareholders in terms of voting, but rather are only allowed in terms of establishing quorum of GMS.
GMS may be held if more than ½ (one half) of the total number of shares with voting rights are present or represented in the GMS, unless a larger quorum is specified by the law or by the articles of association. In the event that the quorum for the first GMS is not achieved, the meeting must be opened and then closed with minutes explaining that the first GMS cannot be performed because the quorum is not achieved and furthermore an invitation to a second GMS may be issued. In the invitation to a second GMS, it must state that the first GMS was held but did not achieve its quorum. Read the rest of this entry »
UnderLaw Number 40 of 2007 on Limited Liability Company (“Company Law“), in Article 1 number 4, General Meeting of Shareholder, hereinafter called the GMS means the Company Organ which has authority that is not given to the Board of Directors or the Board of Commissioner within limits specified in this Company Law and/or the articles of association. Provisions onGMS are set out in the Company Law, in chapter VI General Meeting of Shareholders from Article 75 to Article 91.
Shareholders are entitled to obtain information related to the company from the Board of Directors or the Board of Commissioners in so far as it is connected to the agenda of the GMS and does not conflict with the Company’s interest. Other meeting agenda is not allowed to be approved by GMS, unless all of the shareholders who are present or represented approving the additional of the meeting agenda.
a. based on a General Meeting of Shareholders’ resolution (“GMS”);
b. Because the period of incorporation determined in the articles of association has expired;
c. based on a court determination;
d. On revocation of bankruptcy pursuant to the commercial courtdecision which has absolute legal effect, the Company’s estate being insufficient to pay the cost of bankruptcy;
e. Because the bankrupt estate of a Company which has been declared bankrupt is in aninsolvent condition as regulated in the Law of Bankruptcy and Suspension of Payment of Debt; or
f. Because of the revocation of the Company’s business permits,so that the Company must enter into liquidation in accordance with the prevailing laws.
The dissolution of the company based on the resolution of GMS, is submitted by the Board of Director, the Board of Commissioners, or one or more shareholders representing at least 1/10 (one tenth) of the total number of shares with voting rights. The decisions of GMS about the company dissolution shall be lawful if adopted on the basis of deliberation to reach a consensus and/or if in the meeting at least ¾ (third quarters) of the total number of shares with voting rights are present or represented in the GMS and approved by at least ¾ (third quarters) of the number of the votes cast. Read the rest of this entry »