An study on memorandum of association and Articles of association. It contains the difference between memorandum of association and Articles of association, partnership deed and sales agency agreement and effects of registration of Memorandum of association and Articles of association while incorporating a business. All precisely.

1. Welcome to the
presentation on Legal and
Ethical Environment of
Business

2. Prepared by Prepared for
Aniruddha Dey Anik
ID: 02-15-012
Batch: BBA-2
AIBA, Savar
Md. Noman Siddikee
Adjunct Faculty
AIBA, Savar

3. Difference between MOA and AOA
When someone found a company two important documents Memorandum of
Association and Articles of Association are always there. Have a look MOA vs
AOA!
BASIS FOR
COMPARISON
MEMORANDUM OF
ASSOCIATION
ARTICLES OF
ASSOCIATION
Definition Memorandum of Association
(MOA) is a document that
contains all the fundamental
data which are required for
the company incorporation.
Articles of Association
(AOA) is a document
containing all the rules and
regulations that govern the
company

4. Difference between MOA and AOA
(Continued)
BASIS FOR
COMPARISON
MEMORANDUM OF
ASSOCIATION
ARTICLES OF
ASSOCIATION
Registration MOA must be registered at the
time of incorporation.
The articles may or may not be
registered.
Scope The Memorandum is the charter,
which characterizes and limits
powers and constraints of the
organization.
The articles demonstrate
obligations, rights, and powers
of individuals, who are
endowed with the responsibility
of running the organization and
administration.
Status The memorandum cannot give
the company power to do
anything opposed to the
provision of the companies act.
The articles are constrained by
the act, but they are also
subsidiary to the memorandum
and cannot exceed the powers
contained therein.

5. Difference between MOA and AOA
(Continued)
BASIS FOR
COMPARISON
MEMORANDUM OF
ASSOCIATION
ARTICLES OF
ASSOCIATION
Contents
A memorandum must
contain six clauses.
The articles can be
drafted according to the
decision of the Company.
Objectives
The memorandum
contains the objectives and
powers of the company.
The articles provide the
regulations by which
those objectives and
powers are to be
conveyed into impact.
Validity
The memorandum is the
dominant instrument and
controls articles.
Any provision, as
opposed to a
memorandum of
association, is invalid.

6. Effects of Registration of MOA and
AOA
The effect of the Memorandum of Association and the Articles of
Association when registered is that
1. They bind each member to the company,
2. They bind the company to the members,
3. They bind members inter se i.e., bind each member to other
members,
4. But they do not bind either the company or the members to the
outsiders.

7. Effects of Registration of MOA and
AOA (Continued)
1. Bind Each Member to the Company: It is presumed that
each member has signed both the Memorandum and the
Articles of the company. These documents are treated as
contracts entered into between the company and outsiders. So
these documents bind the members to the company.
2. Bind The Company to Each Member: Articles of the
company bind the company and the members. Under the
terms of the articles, a company is bound to comply with the
provisions thereof a member is entitled to enforce compliance
by the company with a clause in the Articles conferring on
him a right to a share certificate. Now it is settled that a
member can enforce or protect the rights given to him as a
member of the company.

8. Effects of Registration of MOA and
AOA (Continued)
3. Bind Each Member to Other Members [Members inter
se] : There is no contract between the members on the basis
of these documents. Even then the Articles have the effect of
binding every member’ to other members. But the members
cannot sue each other. Usually, one member can sue other
members through the medium of the company.
E.g. If a member does a wrong thing against the interest of the
company, another member can sue him only through the
company.

9. Effects of Registration of MOA and
AOA (Continued)
4. Where the Company is not Bound By Articles: In the case
of Eley V. Positive etc. Company, the Articles include a clause
providing that A should be employed life long as a solicitor of
the company and he should not be removed except for
misconduct. A accordingly took office as solicitor of the
company and during his employment he also became a
shareholder of the company.
Sometime after, the company dispensed with his services. He
however remained as a shareholder and he sued the company
for breach of contract. The Court of Appeal held that no
action would lie.

10. Deed of Partnership
This deed of partnership is made on [Date, Month, Year] between:
1. [First Partner’s Name], [Son/Daughter] of [Mr. Father’s Name], residing at [Address
Line 1, Address Line 2, City, State, Pin Code] hereinafter referred to as
FIRST PARTNER.
2. [Second Partner’s Name], [Son/Daughter] of [Mr. Father’s Name], residing at
[Address Line 1, Address Line 2, City, State, Pin Code] hereinafter referred to as
SECOND PARTNER.
3. [Third Partner’s Name], [Son/Daughter] of [Mr. Father’s Name], residing at [Address
Line 1, Address Line 2, City, State, Pin Code] hereinafter referred to as
THIRD PARTNER.
4. [Fourth Partner’s Name], [Son/Daughter] of [Mr. Father’s Name], residing at
[Address Line 1, Address Line 2, City, State, Pin Code] hereinafter referred to as
FOURTH PARTNER.
Whereas, the parties hereto have agreed to commence business in partnership and it is
expedient to have written instrument of partnership. Now this partnership deed witnesses
as follows:
1. BUSINESS ACTIVITY
The parties here to have mutually agreed to carry on the business of [Description of
Business Activity Proposed].

11. 2. PLACE OF BUSINESS
The principal place of the partnership business will be situated at [Address Line 1,
Address Line 2, City, State, Pin Code]
3. DURATION OF PARTNERSHIP
The duration of the partnership will be at will.
4. CAPITAL OF THE FIRM
Initially the capital of the firm shall be Rs. [Total Partners Contribution].
5. PROFIT SHARING RATIO
The profit or loss of the firm shall be shared equally among all the partners and
transferred to partner’s current account.
6. MANAGEMENT
The [First Partner] of the firm shall be Managing Partner and he will look after all
the day to day transaction of the firm and any legal activities in the name of the firm
and the remaining partners shall co-operate to do so.
7. OPERATION OF BANK ACCOUNTS
The firm shall open a current account in the name of [Partnership Firm Name] at
any bank and such account shall be operated by [First Partner] and [Second
Partner] jointly as declared from time to time to the Banks.
8. BORROWING
The written consent of all Partners will be required for the partnership to avail
credit facilities from any financial institution.

12. 9. ACCOUNTS
The firms shall regularly maintain in the ordinary course of business, true and
correct accounts of all its transactions and also of all its assets and liabilities, the
property books of account, which shall ordinarily be kept at the firm’s place of
business. The accounting year shall be the financial year from 1st April onwards and
the balance sheet shall be properly audited and the same shall be signed by all the
Partners. Every Partner shall have access to the books and the right to verify their
correctness.
10. RETIREMENT
If any partner shall at anytime during the subsistence of the partnership, be
desirous of retiring from the firm, it shall be competent from his to do so, provided
he shall give at least one calendar month notice of his intention of doing so. The
remaining partner shall pay to the retiring partner or his legal representatives of the
deceased partner, the purchase money of his share in the assets of the firm.
11. DEATH OF PARTNER
In the event of the death of any partners, one of the legal representatives of the
deceased partner shall become the partner of the firm and in the event the legal
representative show their denial to point the firm, they shall be paid the part of the
part of the purchase amount calculated as on the date of the death of the partner.
12. ARBITRATION
Whenever there by any difference of opinion or any dispute between the partners
the partners shall refer the same to an arbitration of one person. The decision of the
arbitration so nominated shall be final and binding on all partners, such arbitration
proceedings shall be governed by Indian Arbitration Act, which is in force.

13. SALES AGENCY AGREEMENT
THIS AGREEMENT made as of the day of , 19 .
BETWEEN:
a sole proprietorship
located at
Calgary, Alberta
(hereinafter referred to as )
- and -
of the
City of , in
(hereinafter referred to as the "Sales Agent")
Agency Agreement
WHEREAS wishes to engage the Sales Agent for the purpose of soliciting orders for and
selling, jewellery and giftware in Western Canada;
AND WHEREAS the Sales Agent wishes to act in such capacity in accordance with the terms and
conditions herein contained;
NOW THEREFORE, in consideration of the mutual covenants and agreements herein contained,
and the Sales Agent hereto agree as follows:
Agreement
1. hereby agrees to engage the Sales Agent to provide services to and
the Sales Agent hereby agrees to provide services to upon and subject to the terms and
conditions hereinafter set forth.
2. hereby appoints the Sales Agent as its agent for the sole purposes of soliciting
orders for, and selling, jewellery and giftware in accordance with the terms and conditions of this
Agreement.
Terms of Agreement
3. This Agreement shall be effective on the day of , 19 .
4. This Agreement shall continue in full force and effect for a term of one (1) year from the effective
date hereof and for successive periods of one year thereafter, unless terminated by either party in
accordance with the provisions of Clause 5 of this Agreement.
5. Either party to this Agreement may terminate the Agreement at any time upon thirty (30) days
written notice to the other party.

14. - the Province of (the "Territory").
7. may at any time, enlarge, reduce, or other wise change the Territory of the Sales
Agent by giving notice in writing change, without otherwise affecting the terms of this Agreement.
8. It is a condition of this Agreement that the Sales Agent shall not solicit orders for, or sell, the
jewellery and giftware of in any territory other than the Territory specified in Clause 6
hereto.
Obligations of the Sales Agent
9. The Sales Agent hereby covenants and agrees that he/she shall:
a. solicit orders and sell the jewellery and giftware provided by in accordance with
the terms and conditions of this Agreement;
b. obtain bonding as security for the jewellery and giftware provided by , where
deems such bonding necessary;
c. pay all of his/her own expenses relating to the provision of services under this
Agreement;
d. perform all duties and responsibilities under this Agreement in a professional and
competitive manner, always striving to promote the success and reputation of
;
e. recognize and adopt the guidelines and policies of in relation to establishing the
creditworthiness of potential customers; and
f. recognize and adopt the guidelines and policies of in relation to the invoicing
and administration of accounts of its customers.
10. For the services rendered by the Sales Agent pursuant to this Agreement, the Sales Agent shall
be entitled to commissions at the rate of % upon the wholesale list price of the jewellery and
giftware sold by him/her (the "Commissions")
11. It is a condition of this agreement, and the parties hereby agree, that all Commissions are subject
to final payment by the customer.
12. It is a condition of this Agreement, and the parties hereby agree, that Commissions shall not be
deemed to have been earned by the Sales Agent until the invoice has been paid by the customer.
Samples
13. hereby agrees to provide the Sales Agent with samples of the jewellery and giftware
that shall be sold by the Sales Agent in accordance with the terms and conditions of this
Agreement (the "Samples").

15. Samples for any reason whatsoever.
15. The Sales Agent shall immediately return the samples provided by when requested.
Independent Contractor
16. In the performance of the work, duties and obligations in any way connected with this Agreement,
it is acknowledged and agreed that the Sales Agent is performing as an independent contractor,
and shall have full and exclusive control over his/her provision of services.
17. The Sales Agent hereby agrees to indemnify and save harmless from and against any
loss, costs or other liability whatsoever arising from or out of or in any way related to the provision
of services by the Sales Agent to or out of the wanton or reckless conduct or dishonesty
of the Sales Agent in respect of any such services.
Restrictive Covenant
18. The Sales Agent hereby agrees that he/she will not directly or indirectly, either solely or jointly
with another person, firm or corporation, carry on the business of soliciting orders for, or selling,
jewellery and giftware in competition with in the Territory delimited in Clause 6 of the
Agreement for a period of six (6) months after the termination of this Agreement, without the
express written consent of .
Miscellaneous
19. This Agreement contains the entire understanding and agreement between the parties, and may
not be amended or modified except by the execution of a written amending agreement by each of
the parties hereto.
IN WITNESS WHEREOF the parties hereto have executed this Agreement as of the day and year first
above written.
per:
Sales Agent