7400. It will suffice, in a book intended for popular reading, merely to mention the fact that it is quite possible and in some rare instances desirable, to make the shareholders of a registered company liable to unlimited losses, to the extent of all they possess, just as in the case of a private partnership (6915).

LIMITATION BY GUARANTEE.

7401. Beyond Share Capital.—The Act of 1862 provides tnat, when the shareholders of a company choose, they may extend their liability beyond the share capital to any amount they think fit to name as a limit, in the event of the company being wound up; thus,

7402. Amount of Shares.—Supposing the shares in a company limited by guarantee are of £100 each, each shareholder is liable. in any event, to pay the full amount of his shares when duly called upon to do so; and also,

7403. Fixed Additional Amount.-In the event of the company being wound up (7863), an additional sum (say £50) per share, over and above the share capital; but,

7404. Deferred Liability.—It is to be distinctly understood that, in a company limited by guarantee, the additional amount guaranteed is not payable or available until after proceedings have been duly initiated for winding up; so that,

7405. Not Available for Business.-So long as a company, limited by guarantee, is carrying on business, the directors can only avail themselves of the share capital, in the same manner as in the case of a company limited by shares only; consequently,

7406. Security for Creditors.--- Limitation by guarantee is a device for more effectually securing the creditors, and strengthening the credit of a company, the guaranteed fund being no advantage in the practical working of the business; therefore,

7407. Seldom Resorted to.—Companies limited by guarantee are, for ordinary purposes, seldom resorted to; but,

7408. Against Disaster.—When the object of a company is a mutual one, as for insurance, a very small paid-up capital, together with the premiums immediately accruing, is generally sufficient to meet ordinary expenses and contingencies, and a provision in the way of a guarantee (7403) is then a valuable element, in the event of any unusual disaster or succession of misfortunes bringing the project to an end; for,

7409. Peculiar Advantage.-There is this advantage about limi

tation by guarantee, that it is an ample security for creditors, and at the same time compels the officials to accept the option of economical management or winding up, as their available amount of ready money is strictly prescribed within the amount of shares; but,

7410. Beneficial Objects.-The shares of a company limited by guarantee, being for the most part unsaleable in the public market, are only adapted for companies for carrying out some beneficial object, irrespective of its probable value as a direct pecuniary in

vestment.

LIMITATION BY SHARES.

7411. Almosi Universal.-The most popular and almost universally adopted course, in the establishment of a company, is to secure limitation by shares (7416).

PROCEEDINGS.

7412. Uniformity.-The modes prescribed for incorporating an unlimited company, or a company limited by guarantee, are in almost every respect (7416) similar to those prescribed for the incorporation of a company limited by shares.

REGISTER OFFICE.

7413. The Joint Stock Companies' Register Office is at No. 13, Serjeants' Inn, 49, Fleet Street, London, E.C.

7414. Forms.-Detailed official information and forms for the incorporation of a company may be procured on application personally or by post to the Registrar of Joint Stock Companies at the office (7413).

THE MEMORANDUM.

7415. As soon as the articles of association (7184) are agreed upon, the next step towards the incorporation of a company is to procure a form of memorandum of association (7416).

FORM FOR A LIMITED COMPANY.

7416. The form of memorandum of association, prescribed by the Act, for the incorporation of a company limited by che-es, is as

follows:

7400. It will suffice, in a book intended for popular reading, merely to mention the fact that it is quite possible and in some rare instances desirable, to make the shareholders of a registered company liable to unlimited losses, to the extent of all they possess, just as in the case of a private partnership (6915).

LIMITATION BY GUARANTEE.

7401. Beyond Share Capital.—The Act of 1862 provides tnat, when the shareholders of a company choose, they may extend their liability beyond the share capital to any amount they think fit to name as a limit, in the event of the company being wound up; thus,

7402. Amount of Shares.-Supposing the shares in a company limited by guarantee are of £100 each, each shareholder is liable, in any event, to pay the full amount of his shares when duly called upon to do so; and also,

7403. Fixed Additional Amount.-In the event of the company being wound up (7863), an additional sum (say £50) per share, over and above the share capital; but,

7404. Deferred Liability.—It is to be distinctly understood that, in a company limited by guarantee, the additional amount guaranteed is not payable or available until after proceedings have been duly initiated for winding up; so that,

7405. Not Available for Business.-So long as a company, limited by guarantee, is carrying on business, the directors can only avail themselves of the share capital, in the same manner as in the case of a company limited by shares only; consequently,

7406. Security for Creditors.--- Limitation by guarantee is a device for more effectually securing the creditors, and strengthening the credit of a company, the guaranteed fund being no advantage in the practical working of the business; therefore,

7407. Seldom Resorted to.-Companies limited by guarantee are, for ordinary purposes, seldom resorted to; but,

7408. Against Disaster.-When the object of a company is a mutual one, as for insurance, a very small paid-up capital, together with the premiums immediately accruing, is generally sufficient to meet ordinary expenses and contingencies, and a provision in the way of a guarantee (7403) is then a valuable element, in the event of any unusual disaster or succession of misfortunes bringing the project to an end; for,

7409. Peculiar Advantage.—There is this advantage about limi

7424. By Consent.-When a company is in course of winding up, the consent of its authorities to the adoption of the whole or any portion of its name by a new company, will legalize the naming of such new company after such old name.

ALTERATION OF NAMES.

7425. Obstacles.-When once the name of a company is registered and the company duly incorporated, no change whatever can be made in the name except by the intervention of a public authority, independent of the company.

7426. By the Registrar.—When it appears that the name of a company has been (purposely or inadvertently) registered like that of any previously incorporated company, or so nearly the same as to be calculated to deceive, the registrar is empowered, upon application of either of the companies concerned, to alter the name of the newer company, so as to distinguish its separate identity to his satisfaction.

7427. By Injunction.—If an old company objects to the name of a new company, and has applied in vain to the registrar to effect a change, an application to the Court of Chancery may sometimes succeed in procuring the change desired, upon a full statement of the case, and conclusive proof of the reasonableness and sufficiency of the objection.

7428. By the Board of Trade.-In cases of dispute between two companies about their names, the Board of Trade will not interfere; but,

7429. By Resolution.-When a company has, for any reason, become dissatisfied with its name, and has passed a resolution to alter the name, the secretary or an assistant secretary of the Board of Trade is empowered to authorize such change of name by writing under his hand, and upon production of a copy of its resolution, and certificate of the Board of Trade, the registrar will issue a new certificate of incorporation (7569) and enter all other office records necessary to meet the case.

7430. Frivolous Reasons. The public authorities, who are empowered to sanction the alteration of names of companies, are qualified to refuse such sanction in all cases of a frivolous desire for alteration, without good ground alleged; and,

7431. Fraudulent Reasons.—If a proposed alteration in the name of a company is, from any apparent cause, calculated to deceive or lead to fraud of any kind, such proposed alteration may be in any case refused.

Ist. The name of the company is "The Extern Steam Pachet Company, Limited (7476)."

2nd. The registered office of the company will be situate in England.

3rd. The objects for which the company is established are, the conveyance of passengers and goods in ships or beats between such places as the company may from time to time determine, and the doing of all such other things as are inc dental or conducive to the attainment of the above object.

4th. The liability of the members is limited (7468).

5th. The capital of the company is two hundred thousand pounds, divided into one thousand shares of two hundred pounds each.

We, the several persons whose names and addresses are subscribed, are desirous of being formed into a company, in pursuance of this memorandum of association, and we respectively agree to take the number of shares in the capital of the company set opposite our respective names.

Witness to the above signatures,

A. B., No. 13, Hute Street, Clerkenwell, Middlesex.

7417. Note.-The invariable parts of the form of memorandum of association (7416) are printed in roman letters; the variable and optional parts are printed in italics.

7418. Invariable Parts.-In preparing a memorandum of association, whether an office form is used or not, the invariable parts must be adhered to in every particular.

7419. The variable parts must all be filled up; but,

7420. Wide Diversity.-They are open to a very wide diversity of description and designation.

NAME OF COMPANY.

7421. Exclusive Copyright.-The only restriction upon the name of a company is that it must not be the same as that of any other company already incorporated;

7422. Confusion of Identity.-Nor so nearly the same as to be calculated to deceive strangers as to identity; but,

7423. Defunct Companies.-A new company may assume the name of any old company which has been wound up, or which has become defunct; or,