Question 3abc
Three years ago Ho subscribed for shares in two companies: Ice Ltd and Jet plc. In relation to the shares in Ice Ltd, Ho was only required to pay 50 pence per £1 share when he took the shares and was assured that he would not be required to make any further payment on them to Ice Ltd and the company passed a resolution to that effect. Unfortunately, Ice Ltd has gone into insolvent liquidation owing a substantial sum of money to its creditors.
In relation to the shares in Jet plc, Ho was required to pay a premium of 50 pence per £1 share. The shares are currently trading at 75 pence per share.
Required:
| (a) | Describe any potential liability Ho may have with regard to the shares he holds in Ice Ltd and to whom any |
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| (b) | Explain the meaning and purposes of a share premium account. |
| (c) | Explain whether Ho can gain access to the premium paid on the shares in Jet plc. |