Karibo Ltd is a small company with an issued share capital of R100,000 divided into 100,000 shares of R1 each. It has 50 shareholders. Samuel is the managing director of Karibo Ltd.Graphics Ltd, another small company, found out that Karibo Ltd is about to award a five-year contract for the maintenance of its office premises. Graphics Ltd approached Samuel, and offered him what they describe as a facilitation fee of R5,000, to ensure that the contract is awarded to Graphics Ltd.At the next board meeting, Samuel convinces the other directors that awarding the maintenance contract to Graphics Ltd is in the long-term interest of Karibo Ltd and the contract is awarded to Graphics Ltd.At the same board meeting, Samuel also informs the board that Marico Ltd, a competitor, is contemplating taking over Karibo Ltd and that a majority of the existing shareholders might be willing to sell their shares to Marico Ltd if they are offered a good price.In order to prevent it, the board decides to issue additional shares to the directors and make each of the new shares carry ten votes each. The existing shares carry one vote per share.Thomas, an ordinary shareholder in Karibo Ltd, has found out about the facilitation fee to Samuel and the decision to allot weighted shares to the directors.Required:Advise Thomas, whether any action can be taken against Samuel in respect of the facilitation fee, and on the legality of the weighted share allotment. (10 marks)
