COMPANIES ACT, 2019 (ACT 992). SS 1-115

THE COMPANIES ACT, 2019 (ACT 992)

DATE OF ASSENT: 2nd August, 2019.

DATE OF GAZETTE NOFICATION: 2nd August, 2019.

AN ACT to amend and consolidate the law relating to companies; to establish the Office of the Registrar of Companies; and to provide for related matters.

CHAPTER ONE-PRELIMINARY PROVISIONS
1. Application of Act

(1) Except as otherwise provided, this Act applies to companies formed in the Republic,   whether before or after the commencement of this Act.

(2) This Act does not affect the validity of anything done before the date when the Act comes into operation.

2. Application of particular chapters

(1) Chapter Two applies to all companies.

(2) Chapter Three applies to private companies.

(3) Chapter Four applies to public companies.

(4) Chapter Five applies to external and non-Ghanaian companies.

3. Prohibition of association exceeding twenty members

A company, or an association consisting of more than twenty persons shall not be formed for the purpose of carrying on a business that has for the object of the company or association, the acquisition of gain by the company or association or by the individual members of the company or association, unless the company or association is registered as a company under this Act or is formed in pursuance of any other enactment.

4. Companies formed for special purposes

This Act does not abrogate or affect legislation relating to companies carrying on the business of banking, insurance or any other business which is subject to special regulation.

5. Saving of equity and common law

The rules of equity and of common law applicable to companies shall continue in force unless they are inconsistent with a provision of this Act.

CHAPTER TWO-PROVISIONS APPLICABLE TO ALL COMPANIES

Part A: Formation and Incidental Matters

6. Right to form a company

One or more persons may form an incorporated company under this Act.

7. Types of companies

(1.) An incorporated company may be

(a) a company limited by shares;

(b) a company limited by guarantee;

(c) an unlimited company; or

(d) an external company.

(2) For the purposes of subsection (1),

(a) a company limited by shares is a company which has the liability of its members limited to the amount unpaid on the shares respectively held by them;

(b) a company limited by guarantee is a company which has the liability of its members limited to an amount that the members may respectively undertake to contribute to  the assets of the company in the event of its being wound up;

(c) an unlimited company is a company which does not have a limit on the liability of its members; or

(d) an external company is a company as defined in section 329.

(3)  A company limited by shares and an unlimited company shall for the purposes of incorporation be registered with shares.

(4)  A company of a type specified in subsection (1), may be a private company or a public company.

(5)  A private company, other than a company limited by guarantee, is a company which by virtue of its constitution

(a) restricts the right to transfer the shares of the company, if any,

(b) limits the total number of the members and debenture holders co fifty, not including

(i) persons who are genuinely in the employment of the company, and

(ii) persons who, having been formerly in the employment of the company, were while in that employment, and have continued after the determination of that employment to be members or debenture holders of the company;

(c) prohibits the company from making an invitation to the public to acquire shares or debentures of the company; and

(d) prohibits the company from making an invitation to the public to deposit money for fixed periods or payable at call, whether bearing or not bearing interest.

(6) Where two or more persons hold one or more shares or debentures jointly, they shall, for the purposes of subsection (3) be treated as a single member or debenture holder.

(7) A company which is not a private company is a public company except a company limited by guarantee which has a membership of fifty or less.

(8) A company limited by guarantee shall not for the purposes of incorporation be registered with shares and shall not create or issue shares.

8. Companies limited by guarantee

(1) A company limited by guarantee shall not be incorporated with the object of carrying on business for the purpose of making profits other than making profits for the furtherance of its objects.

(2) Where a company limited by guarantee carries on business for the purpose of making   profits, other than for the furtherance of the objects of the company, the officers and members of that company who are cognisant of the fact that the company is so carrying on  business are jointly and severally liable for the payment and discharge of the debts and  liabilities of the company incurred in carrying on that business, and the company and those  officers and members are each liable to pay to the Registrar, an administrative penalty of twenty-five penalty units for each day during which the company carries on chat business.

(3) The total liability of the members of a company limited by guarantee to contribute to the  assets of the company in the event of the company being wound up shall not at any time be  less than the amount of money specified in the application required for incorporation.

(4) Where in breach of subsection (3), the total liability of the members of a company limited by guarantee is at any time, less than the amount specified in the application required for incorporation, every director and member of the company who is cognisant of the breach is liable to pay to the Registrar an administrative penalty of five hundred penalty  units.

9. Conversion of company limited by shares to company limited by guarantee

(1) A company limited by shares may be converted into a company limited by guarantee if,

(a) the liability on any of its shares is fully paid;

(b) all the members agree in writing to the conversion and to the voluntary surrender co the company for cancellation of the shares held by them immediately before the conversion;

(c) a new constitution, appropriate to a company limited by guarantee, is adopted by the company pursuant to section 30; and

(d) a member agrees or the members agree in writing to contribute to the assets of the company, in the event of the company being wound up, to an amount of money not  less than that prescribed by subsection (3) of section

(2) On delivery to the Registrar for registration of a statutory declaration by a director and the Company Secretary confirming that the conditions of subsection (1) have been complied with, the Registrar shall issue a new certificate of incorporation to the effect that the company is limited by guarantee.

(3) From the date stated in the certificate

(a) the company is converted into a company limited by guarantee,

(b) the shares in the company shall be validly surrendered and cancelled despite the provisions of section 58, and

(c) the members of the company who have not agreed to contribute to the assets of the company in the event of the company being wound up cease to be members of the

(4)  Except in accordance with subsection (4) of section 21, the company shall not change the name under which the company was  registered before  the conversion.

(5)  The  omission of words

(a) "(plc) Public Liability Company", or

(b) "(ltd) Private Company Limited" as the last words of the name of the company after conversion shall not be regarded as a change of name.

(6) If the Registrar is of the opinion that the name under which the company is registered will be misleading or undesirable on its conversion to a company limited by guarantee, the Registrar shall in accordance with subsection (6) of section 21, direct the company to change its name and shall not issue a new certificate of incorporation until the direction has been complied with or cancelled in accordance with that  subsection.

(7) Until a new certificate of incorporation is issued under sub-section (2), neither the surrender of the shares of the company nor the agreement to contribute to the assets of the company in the event of the company being wound up shall take effect.

(8) The conversion of a company, pursuant to this section shall not

(a) affect the rights or obligations of the company except as mentioned in this section; or

(b) render defective  any  legal  proceedings by or against the company.

10. Duties of promoters

(1) A person who is or has been engaged or interested in the formation of a company is a promoter of that company.

(2) A person acting in a professional capacity for persons engaged in procuring the formation of a company is not a promoter of that company.

(3) The promoter shall, until the formation of a company is complete and the working capital     of the company has been raised,

(a) stand in a fiduciary relationship to the company;

(b) observe utmost good faith towards the company in a transaction with the company or on behalf of the company; and

(c) compensate the company for any loss suffered by the company by reason of the failure of the promoter to observe utmost good faith.

(4) A promoter that acquires property or information in circumstances in which it was the  duty of the promoter as a fiduciary to acquire the property or information on behalf of the   company, shall account to the company for the property or information and for the profit   which the promoter may have made from the use of that property or information.

(5) A transaction between a promoter and the company may be rescinded by the company  unless, after full disclosure of the material facts known to the promoter, the transaction has  been entered into or ratified on behalf of the company,

(a) by the board of directors of the company, if all the directors of the company are independent of the promoter;

(b) by all the members of the company; or

(c) by the company at a general meeting at which neither the promoter nor the holders of the shares in which the promoter is beneficially interested have voted on the resolution   to enter into or ratify that transaction.

(6) A period of limitation shall not apply to proceedings brought by a company to enforce a  right under this section.

(7) In proceedings under subsection (6), the Court may relieve a promoter in whole or in part  and on the terms that the Court considers fit from liability if in the circumstances, including  lapse of time, the Court considers it equitable so to do.

11. Pre-incorporation contracts

(1) A contract or any other transaction purporting to be entered into by a company before the formation of the company, or by a person on behalf of the company before its formation,      may be ratified by the company within eighteen months after the formation of the company.

(2) On  ratification under subsection (1), the company shall become bound by, and entitled  to the benefit of, that contract or that transaction as if the company has been in existence at  the date of that contract or other transaction and had been a party to the contract or other  transaction.

(3) Before ratification by a company, the person who purported to act in the name or on  behalf of the company is, in the absence of express agreement to the contrary, personally   bound by the contract or other transaction and is entitled to the benefit of the contract or other transaction.

Part B: incorporation of Companies
12. Right to apply for incorporation

Subject to this Act, a person of the age of eighteen years and above may apply for the  incorporation of a company under this Act.

13. Application for incorporation

(1) An application for incorporation shall be made in the prescribed form and delivered to the

(2) The application shall include

(a) the name of the company as required by section 21;

(b) an indication of the type of proposed company;

(c) the nature of the proposed business in the case of a company registered with an object;

(d) the address of the proposed registered office and principal place of business of the company in the Republic, the telephone number and the post office box, private mailbag or digital address of the registered office  of the  company;

(e) the electronic mail address and website of the company, if available;

(f) the following particulars of each subscriber:

(i) the date and place of birth;

(ii) the present full name and any former name;

(iii) the residential, occupational, postal and electronic mail addresses and telephone contact; and

(iv) the nationality;

(g) the following particulars of each proposed director of the proposed company:

(i) the present full name and any former name;

(ii) the particulars of any business occupation and other directorships held by the director as provided by section 215; and

(iii) the residential, occupational, postal and electronic mail addresses and telephone contact;

(h) a statutory declaration by each proposed director of the proposed company indicating that within the preceding five years, that proposed director has not been

(i) charged with or convicted of a criminal offence involving fraud or dishonesty;

(ii) charged with or convicted of a criminal offence relating to the promotion, incorporation or management of a company; or

(iii) declared insolvent or if that proposed director has been insolvent, the date of the insolvency and the particulars of that company;

(i) the consent of each proposed director;

(j) the following particulars of the proposed Company Secretary of the proposed company:

(i) the present full name and any former name;

(ii) the usual postal, occupational and electronic mail address;

(iii) the residential address in the case of an individual; and

(iv) the business occupation as provided by section 215;

(k) the following particulars of the proposed auditor of the proposed company:

(i) the present full name and any former name;

(ii) the postal and electronic mail addresses and telephone number;

(iii) the residential address in the case of an individual; and the consent of the auditor;

(l) the following particulars of each subscriber for a proposed company with shares:

(i) the full name and any former or other name;

(ii) the date and place of birth;

(iii) the telephone number;

(iv) the nationality and proof of identity;

(v) the residential, postal or email address, if any;

(vi) place of work and position held;

(m) the following particulars in respect of each beneficial owner of the proposed company:

(i) the full name and any former or other name;

(ii) the date and place of birth;

(iii) the telephone number;

(iv) the nationality, national identity number, passport number or other appropriate identification and proof of identity;

(v) the residential, postal or email address, if any;

(vi) place of work and position held;

(vii) the nature of the interest including the details of the legal, financial, security, debenture or informal arrangement giving rise to the beneficial ownership;  and

(viii) confirmation as to whether the beneficial owner is a politically exposed person;

(n) the following details in the case of a company that has shares:

(i) the amount of proposed seated capital, as defined in section 68;

(ii) the number of authorised shares of the company for each class; and

(o) in the case of a proposed company limited by guarantee the specified amount up to which the member undertakes to contribute to the assets of the company, in the event of the company being wound up while that person is a member or within a stipulated period after ceasing to be a member, for payment of  the  costs, charges and expenses of winding up, and the adjustments of the  rights amongst members.

(3) The application shall be signed by the subscriber or each subscriber if more than one, for shares of  the company by writing opposite the name of the subscriber, the number of shares the subscriber takes and the cash price payable for the shares and the subscriber shall take at least one share.

(4) The provisions of subsection (3) shall apply to an application for incorporation of a company that proposes to register a constitution.

(5) The application for incorporation may be effected by

(a) the delivery of the completed application form as required by subsection (2); or

(b) the delivery of the completed application form as required by subsection (2) accompanied with a proposed constitution.

(6) Without limiting the provisions of subsection (2), the applicant shall furnish the Registrar with appropriate evidence of the identity and place of residence of the applicant at the time of the delivery of the completed application form for incorporation.

14. Incorporation

(1) Where the Registrar is satisfied that the application for incorporation of a company complies with this Act, the Registrar shall, after payment of the prescribed fee, certify under the seal of the Registrar that the company is incorporated and in the case of a limited liability  company, that the liability of the members is limited.

(2)  From the date of incorporation, the company becomes a body corporate by the name  contained in the application for incorporation and, subject to section 13, is capable of performing the functions of an incorporated company.

15. Certificate of incorporation

The certificate of incorporation, or a copy of that certificate, certified as correct by the Registrar, is conclusive evidence that the company has been duly incorporated under this Act and proceedings shall not be brought in a Court to cancel or annul the incorporation.

16. Certificate of incorporation and winding up

Section 15 does not preclude the institution of proceedings to wind up the company in accordance with section 274.

17. Error or omission in document

(1) Where there is an error or omission in a document containing particulars delivered to the Registrar under section 13, the company and every signatory of the document is without limiting section 346, liable to pay to the Registrar an administrative penalty of one  hundred and fifty penalty units.

Part C: Capacity of Companies
18. Powers of companies

(1) Subject to this Act and to any other enactment, a company shall have

(a) full capacity to carry on or undertake any business or activity, do any act, or enter into any transaction; and

(b) full rights, powers and privileges for the purposes of paragraph (a).

(2) Without limiting subsection (1), and despite the provisions of any other enactment, a company shall be capable of giving and entering into and being bound by and claiming all rights under a deed or mortgage or other instrument.

(3) The registered constitution of a company may contain a provision regarding the capacity,   rights, powers or privileges of the company if the provision restricts the capacity of the company or those rights, powers and privileges.

19. Limits of authority of company

(1) Where the registered constitution of a company sees out the nature of business or objects of the company, there is deemed to be a restriction in the registered constitution on the business or activities in which the company may engage, unless the registered  constitution expressly provides otherwise.

(2) Where the registered constitution of a company provides for any restriction on the  business or activities in which the company may engage

(a) the capacity and powers of the company shall not be affected by that restriction; and

(b) an act of the company, a contract or other obligation entered into by the company and a transfer of property to or by the company shall not be invalid by reason only of the fact that it was done in contravention of that restriction.

(3) Subsection (1) shall not affect the application of the provisions of subsection (5) and sections 200, 219 and 275.

(4) Despite subsection (1), an act of a company and a conveyance or transfer of property to, or by, a company is not invalid by reason of the fact that the act, conveyance or transfer was not done or made for the furtherance of any of the authorised businesses or that the  company was otherwise exceeding its objects or powers.

(5) On the application of

(a) a member of the company, or

(b) the holder of a debenture secured by a floating charge overall or any of the property of the company or by the trustee for the holders of those debentures, the Court may   prohibit, by injunction, the doing of an act or the conveyance or transfer of a property   in breach of subsection (1).

(6) Where the transactions sought to be prohibited in proceeding sunder  subsection (5) are being, or are to be, performed or made in accordance with a contract to which the  company is a party, the Court may,

(a) if the Court considers it equitable and if all the parties to the contract are parties to the proceedings, set aside and prohibit the performance of the contract, and

(b) allow for the payment of compensation to the company or to the other parties to the contract for the loss or damage sustained by the company or the other parties by reason of the setting aside or prohibition of the performance of the contract, but  not  compensation for  loss of anticipated profits to be derived from the performance of the contract.

(7) The capacity of the company to do an act shall not be affected by the fact that the act is not, or would not be, in the best interests of a company.

20. Attention of objects or business

(1) Where applicable, a company may change the business for which the company was incorporated to carry on, or in the case of a company not formed for the purpose of carrying on a business, the objects of the company by  special resolution.

(2) Within twenty-eight days of the passing of the special resolution under subsection (1),    notice of the resolution shall be given in the prescribed form to the holders of the   debentures secured by a floating charge over any of the property of the company and to the trustees for the debenture holders.

(3) Where a company defaults in giving a notice as required by this section, the company  and every officer of that company that is in default is liable to pay to the Registrar an  administrative penalty of fifty penalty units.

21. Names of companies

(1) The last words of the name of a

(a) private company limited by shares shall be "Limited Company" or the abbreviation "LTD";

(b) public company limited by shares shall be "Public Limited Company" or the abbreviation "PLC";

(c) company limited by guarantee shall be "Limited by Guarantee" or the abbreviation "LBG"; and

(d) private company unlimited by shares shall be "Private Unlimited Company" or the abbreviation 'PRUC'

(e) public company unlimited by shares shall be "Public Unlimited Company" or the abbreviation "PUC".

(2) A company shall not be registered by a name which, in the opinion of the Registrar, is  misleading or undesirable.

(3) A company shall not be registered with a name of a company that has been dissolved   within the preceding five years of the intended registration.

(4) A company may in writing change its name by special resolution and with the written  approval of the Registrar.

(5) Where, through inadvertence or otherwise, a company on first registration or on  registration by a new name is registered by a name which, in the opinion of the  Registrar,   is misleading or undesirable, the company shall change the name of the company with the  approval of the Registrar.

(6) Where the Registrar so directs within six months of the company being registered by  that name, the company shall change the name within a period of six weeks from the date of the direction.

(7)  Where the Registrar is of the opinion that by reason of a change in the objects of, or the nature of the business carried on by a company, the name under which the company is  registered is misleading or undesirable, the Registrar may direct the company to change the  name and the company shall change that name within six weeks of the direction, unless  within that time the company has lodged an appeal to the Court against the direction.

(8) The Court shall cancel or confirm the direction and if the direction is confirmed, the  company shall change the name within six weeks of the confirmation.

(9)  Where a company defaults in complying with a direction under subsection (6), (7), or (8) the Registrar shall change the name of the company in the Register.

(10) Where a company defaults in complying with a direction under subsection (5), (6), (7) or  (8), the company and any of the directors of the company that are cognisant of the default  are liable to pay to  the Registrar, an administrative penalty of twenty-five penalty units and a further penalty of fifty penalty units for each day that the default continues.

(11) Where a company changes the name of the company under this section, the Registrar  shall record the new name in place of the former name, and shall issue a certificate of  incorporation that indicates the change of name.

(12) Pursuant to subsection (11), the Registrar shall advertise the change in the Companies Bulletin, the website of the Office of the Registrar of Companies and in one daily newspaper published in the Republic and circulating in the district in which the registered office of the company is situated.

(13) A certificate or an advertisement in the Companies Bulletin under this section is conclusive evidence of the change to which the change of name relates.

(14) A change of name by a company shall not affect the rights or obligations of the company or render defective legal proceedings by or against the company, and legal proceedings that might have been continued or commenced against the company under the former name may be continued or commenced against the company under the  new name.

(15) A company limited by shares existing at the commencement of this Act has six months   within which to comply with paragraphs (b) and (c) of subsection (1).

22. Reservation of name

(1) An application for reservation of the name of a company may be sent or delivered to the Registrar, and shall be in a form approved by the Registrar.

(2) The Registrar may, after receipt of the application and on payment of the prescribed fee, reserve a name pending registration of a company or a change of name by a company.

(3) A reservation under subsection (2) shall not exceed two months and may be renewed   for a further period of two months.

(4) A company shall not be registered under a reserved name or under any other name which in the opinion of the Registrar is similar to the reserved name.

Part D: Constitution of the Company
23. Option to have a registered constitution

(1) A company has the option to have a registered constitution.

(2) Where a company opts to have a registered constitution, the document that represents  the constitution shall be

(a) signed by one or more subscribers or the Company Secretary, and

(b) delivered to the Registrar by the subscriber or an authorised representative before incorporation; or

(c) delivered to the Registrar by the Company Secretary, director or  an  authorised representative after incorporation.

24. Effect of Act on company that has lodged a registered constitution

(1) Where a private company has delivered to the Registrar its document intended to be the registered constitution, the rights, powers, duties and obligations of the company, the Board, each director and each shareholder of the company shall have effect as provided in the Second Schedule, unless they are restricted, limited or modified by the registered constitution.

(2) Where a public company has duly delivered the registered constitution of the company,     the rights, powers, duties and obligations of the company, the Board, each director and each  shareholder of the company shall have effect as provided in the Third Schedule, unless they  are restricted, limited or modified by the registered constitution of the company duly delivered  in accordance with this Act.

(3) Where a company limited by guarantee has duly delivered the registered constitution of  the company, the rights, powers, duties and obligations of the company, the Board, each  director and each shareholder of the company shall have effect as provided in the Fourth  Schedule, unless they are restricted, limited or modified by the registered constitution of the company duly delivered in accordance with this Act.

25. Effect of Act on company without a registered constitution

(1) Where a private company does not have a registered constitution, the rights, powers, duties and obligations of the company, the Board, each director and each shareholder of the company shall be as provided in the Second Schedule and be deemed accordingly to be the  constitution of that company, unless they are restricted, limited or modified by  a  registered   constitution of the company duly delivered after incorporation in accordance with this Act.

(2) Where a public company does not have a registered constitution, the rights, powers,  duties and obligations of the company, the Board, each director and each shareholder of the  company shall be as provided in the Third Schedule, and be deemed accordingly to be the  constitution of that company, unless they are restricted, limited or modified by the registered   constitution of the company duly delivered after incorporation in accordance with this Act.

(3) Where a company limited by  guarantee does not have a registered constitution, the rights, powers, duties and obligations of the company, the Board, each director and each member of the company shall be as provided in the Fourth Schedule and be deemed accordingly to be the constitution of  that company, unless they are restricted, limited or modified by the registered constitution of the company duly delivered after incorporation in accordance with this Act.

26. Contents of registered constitution

(1) Where at incorporation, a company opts to have a registered constitution, the registered constitution of that company shall state,

(a) the name of the company, with the last words of the name as required by subsection (i) of section 21;

(b) the names of the first directors of the company; and

(c) that the powers of the directors are limited in accordance with section 189.

(2) Where a company has been incorporated in accordance with this Act and subsequently opts to have a registered constitution, it

(a) may state the nature of the business in that constitution which the company is authorised to carry on, or if the company is not formed for the purpose of carrying on a  business, the nature of the objects for which the company is incorporated; and

(b) shall deliver to the Registrar

(i) the constitution, and

(ii) a special resolution of the company to indicate the intention to have the registered constitution.

(3) In the case of a company having shares, the registered constitution shall also state the number of shares with which the company is to be registered.

(4) A registered constitution may contain any other lawful provisions relating to the structure  and administration of the company.

(5) ln the case of a company that does not have a registered constitution, the company shall be deemed to have as part of the constitution under section 25 the matters with respect  to the

(a) name of the company,

(b) names of its first directors,

(c) number of shares with which the company is registered, and

(d) number of shares subscribed by each shareholder on the incorporation of the company and the consideration to be respectively paid for those shares as are respectively stated in the application for incorporation under section 13.

27. Form of constitution

(1) An unlimited company may have a registered constitution and the form of the constitution shall be in accordance with the form set out in the

(a) Second Schedule, if a private company unlimited by shares, or

(b) Third Schedule, if a public company unlimited by shares, or as near to those with the necessary modifications, but with a statement that the liability of the members is unlimited.

(2) The registered constitution of a company may adopt any of the provisions of the appropriate Schedule and subject to subsection (3),in so far as the constitution does not  exclude or modify those provisions they shall, so far as applicable, be part of the registered  constitution of the company.

(3) The registered constitution of every company shall contain the matters set out in

(a) subsection (1) of section 26, and

(b) paragraphs

(i) 3 and 12 of the Second Schedule in the case of a private company,

(ii) 1 and 2 of the Third Schedule in the case of a public company, and

(iii) 1, 4, 5, 6 and 7 of the Fourth Schedule in the case of a company limited by guarantee.

(4) The registered constitution shall be printed, type written, hand-written or be in any other legible form acceptable to the Registrar.

28. Subscription to constitution

The constitution of a company shall be signed by one or more subscribers in the presence of a witness, who shall attest to the signing.

29. Effect of company constitution

(1) Subject to this Act, the constitution has the effect of a contract under seal

(a) between the company and each member or officer; and

(b) between the members or officers themselves by which they agree to observe and perform the functions contained in the constitution as amended from time to time, in so  far  as they  relate  to  the  company, the members or the officers.

(2) Where the constitution empowers a person to appoint or remove a director or any other officer of the company, such power is enforceable by that person although that  person is not a member or officer of the company.

(3) In an action by a member or an officer to enforce an obligation owed under the  constitution to that member or officer and any other member or officer, that member or  officer shall, if any other member or officer is affected by the alleged breach of the obligation, sue in a representative capacity on behalf of that member or officer and all other members or officers who may be affected other than any who are defendants and the provisions of section 205 shall apply.

(4) The registered constitution of a company shall be void to the extent  that it contravenes or is inconsistent with this Act.

(5) A registered constitution shall not be subject to a stamp duty.

30. Adoption, alteration, amendment and revocation of constitution

(1) The shareholders or members of a company may, by special resolution

(a) adopt a registered constitution where a company does not have a registered constitution; or

(b) alter or revoke the constitution of the company subject to this

(2)  For the purposes of subsection (i) (b),

(a) the name of the company shall not be altered except with the consent of the Registrar in accordance with section 21;

(b) the number of the shares of the company may be altered in accordance with sections 9, 59 to 65, 78 to 82, 219, or 239 but not otherwise;

(c) the businesses for which the company is incorporated to carry on or, if the company is not formed for the purpose of carrying on a business, the objects for which the company is incorporated may be amended in accordance with section 15 or 239 but not otherwise where the business or object is indicated at incorporation;

(d) an amendment shall not be made which shall conflict with an order of the Court made under section 219;

(e) if at any time the shares of the company are divided into different classes, the rights attached to a class may be amended in accordance with section 50 or 239  but  not otherwise;

(f) the constitution may restrict or exclude the power of the company to amend all or any of the provisions of the constitution or to add to the provisions of the constitution, or may impose conditions for the amendment of the constitution, in which event the constitution shall not be amended except in accordance with the provisions of the  constitution or section 239;

(g) the constitution as amended shall be in accordance with this Act and shall contain the requirements under section 26;

(h) except in accordance with section 239, a member of the company is not bound by an amendment made in the constitution after the date on which  that person became a member, where the amendment

(i) requires that member to take more shares than the number held by that member on the date on which the amendment is made,

(ii) in any way increases the liability of that member as at that date to pay money to the company, or

(iii) increases or imposes restrictions on the right to transfer the shares held by that member at the date of the amendment, unless that member agrees in writing, before or after the amendment is made, to be bound by the amendment;

(i) an amendment shall not be made which would have the effect of converting an unlimited company into a limited company or a company limited by guarantee into a company limited by shares; and

(j) an amendment may be restrained or revoked by the Court in accordance with section   218 or 219.

31. Registration of consolidated constitution

(1) Where the Registrar is of the opinion that, due to the numerous amendments to the registered constitution of a company, the amendments should be consolidated in a single document, the Registrar may by notice in writing require a company to deliver to the Registrar a single document that incorporates the registered constitution of the company as amended.

(2) The Board shall within twenty-eight days after receipt by the company of the notice, cause to be delivered to the Registrar

(a) the document for registration;

(b) a certificate signed by a director or Company Secretary authorised by the Board to the effect that the document referred to in paragraph (a) complies with subsection (1) or (2), as the case may be.

(3) On receipt of the document referred to in subsection (2), the Registrar shall register the  document upon the payment of a prescribed fee.

32. Copies of registered constitution

(1) A company shall, upon request of a member, send to that member a copy of its registered constitution on payment of the fee prescribed by the company.

(2) Where an amendment is made to the registered constitution, each copy of the constitution issued after the date of the amendment and whether to a member or to any other  person, shall be in accordance with the amendment.

(3) Where a company defaults in complying with this section, the company and every officer  of the company that is in default commits an offence and is liable on summary conviction  for  each offence to a fine of not less than twenty-five penalty units and not more than fifty penalty units.

Part E: Membership of Companies
33. Members of a company

(1) The subscribers to the documents for the incorporation of a company are members of the company and upon incorporation shall be entered as members in the register of members referred to in section 35.

(2) Any other person who agrees with the company to become a member of the company and whose name is entered in the register of members is a member of the company.

(3) A member has the rights, duties and liabilities that are by this Act and where applicable, by the registered constitution of the company conferred and imposed on the members.

(4) In the case of a company with shares, each member is a shareholder of the company and  shall hold at least one share.

(5) A holder of a share is a member of the company.

(6) Membership of a company with shares continues until

(a) a valid transfer of the shares held by the member is registered by the company;

(b) the shares are transmitted by operation of law to another person, or forfeited for non-payment of calls; or

(c) the member of the company dies.

(7) Membership of a company limited by guarantee continues until the member dies, or validly retires or is excluded from membership.

34. Right of member to attend and vote at general meeting

(1) Subject to subsection (2), and section 52, a member has the right to attend a general meeting of the company and to speak and vote on a resolution before the meeting.

(2) Despite subsection (1), a registered constitution of a company may provide that a member is not entitled to attend and vote at a general meeting unless the calls or any other sums of money presently payable by that member in respect of shares in the company have been paid.

35. Register of members

(1) Subject to the Central Securities Depository Act, 2007 (Act 733) and any other enactment, a company shall keep in the country a register of the members and shall enter in the register

(a) in respect of members of the company

(i) the names and addresses of the members and, in the case of a company having shares, a statement of the shares held by each member, and of the amount paid, or agreed to be considered as paid, on the shares of each member, and of the amount remaining payable on the shares;

(ii) the date at which a person was entered in the register as a member;

(iii) the nature of the interest of each member; and

(iv) the date at which a person ceased to be a member; and

(b) in respect of each beneficial owner of the company

(i) the full name and any former or other name of the beneficial owner;

(ii) the date and place of birth;

(iii) the telephone number;

(iv) the nationality, national identity number, passport number or other appropriate identification, and proof of identity;

(v) residential, postal and email address, if any;

(vi) place of work and position held;

(vii) the nature of the interest including the details of the legal, financial, security, debenture or informal arrangement giving rise to the beneficial ownership; and

(viii) a confirmation as to whether the beneficial owner is a politically exposed person.

(2) For the purpose of paragraph (b) of subsection (1), where a member of a company is not the beneficial owner, that member shall

(a) provide the company with the particulars of the beneficial owner at the time of becoming a member as set out in paragraph (bi, and

(b) update the company within twenty-eight days of a change in the particulars submitted under paragraph (a) .

(3) The entry required under subparagraphs (i) and (iii) of paragraph (a) of subsection (1) shall be made within twenty-eight days of the conclusion of the agreement with the person to become a member.

(4) The entry required under subparagraph (iv) of paragraph (a) of subsection (1) shall be made within twenty-eight days of the date when the person concerned ceased to be a  member, or, if that person ceased  to be a member otherwise than as a result of an  action by the company, within twenty-eight days of production to the company of evidence satisfactory to the company of the occurrence of the event by which that person ceased to be a member.

(5) The entry required under paragraph (b) of subsection (1) shall be made within twenty-eight days of receipt of the necessary particulars under subsection (2).

(6) A company shall, within twenty-eight days of making an entry required under paragraph (b) of subsection (1) and subsection (5), submit particulars of the entry to the Registrar for registration and indicate the members or beneficial owners who are politically exposed persons.

(7) The entries relating to a person who has ceased to be a member may be deleted from the register after the expiration of six years from the date when the person ceased to be a member.

(8) Where a company has more than fifty members, the register shall contain an index of the names of the members and the names of beneficial owners in a form that enables the account of each member to be readily found.

(9) An existing company shall, within twenty-eight days of a change in the place at which the  register of members is kept, send notice of the change to the Registrar.

(10) A company is not bound to send notice where the register has, since the company came  into existence, been kept at the registered office of the company.

(11) An existing company shall, within two months  after the coming into force of this Act,  submit the information required under paragraph (b) of subsection (1) to the Registrar for registration.

(12) The company may arrange with any other person, to be known as the registration officer, for the making up of the register to be undertaken on behalf of the company by the registration officer at the office of that officer, and if by reason of a default of the registration officer the company defaults in complying with this section or with section 36, the registration     officer is liable to the same penalties as if the registration officer were an officer of the  company.

(13) The power of the Court under subsection (6) of section 36 shall extend to the making of orders against the registration officer and the officers and employees of the registration officer.

(14) A person who

(a) fails to provide the information required under subsection (2), or

(b) provides false or misleading information to the Registrar commits an offence and is liable on summary conviction to a fine of not less than one hundred and fifty penalty units and not more than two hundred and fifty penalty units or to a term of imprisonment of not less than one year and not more than two years or to both.

(15) Where a company defaults in complying with this section, the company and every officer of the company that is in default is liable to pay to the Registrar, an  administrative penalty of twenty-five penalty units for each day during which the default continues.

36. Inspection of register

(1) Except when the register of members is closed in accordance with section 37, the register, the index of the names of the members of the company and the index of the names of beneficial owners of the company shall, during business hours, and subject to reasonable restrictions that the company may impose, be open for the inspection of

(a) a member  without   charge,  and

(b) any other person on payment of a reasonable fee prescribed by the company, for each inspection.

(2) Not less than two hours each day, other than a Saturday, Sunday or a public holiday, shall be allowed for inspection under subsection (1).

(3) A member or any other person may require a copy of the register or a part of the register on payment of a fee prescribed by the company.

(4) The company shall send the copy so required by a person to that person within a period of ten days commencing on the day next after the day on which the requirement is received by the company.

(5) Where an inspection required under this section is refused, or where a copy required under this section is not sent within the proper period, the company and every officer of the company that is in default, is liable in respect of each default to pay to the Registrar, an administrative penalty of twenty-five penalty units for each day during which the default continues.

(6) In the case of a refusal or default, the Court may order  the immediate production of the register for inspection or direct that the copies required be sent to the person  requiring them.

37. Power to dose register

A company may close the register of members or that part of the register relating to a class of members for any time or times of not more than a total period of thirty days in each year on giving reasonable notice by

(a) advertisement in a daily newspaper of national circulation in which the registered office of the company is situated; and

(b) electronic means.

38. Rectification of register

(1) A person aggrieved, a member of the company, or the company, may apply to the Court for rectification of the register where

(a) the name of a person is, without sufficient cause, entered in or omitted from the register of members of a company, or

(b) default is made in entering on the register any of the particulars which, under section 35, are required to be entered on the register.

(2) Where an application is made under subsection (1), the Court may refuse the application or may order rectification of the register and payment by the company of compensation for the loss sustained by the aggrieved party.

(3) Where an application is made under subsection (1), the Court may decide a question relating to the entitlement of a person who is a party to the application to have the name of that person entered in or omitted from the register, whether, the question arises

(a) between members or alleged members, or

(b) between members or alleged members on the one hand and the company on the other hand; and generally the Court may decide a question necessary or expedient to be decided for rectification of the register.

(4) A company may, without application to the Court, at any time rectify an error or omission in the register of members, but the rectification shall not adversely affect a person unless that  person agrees to the rectification made.

39. Register to be evidence

(1) The register of members is prima facie evidence of the matters which by this Act are directed or authorised to be inserted in the register.

(2) Subsection (1) shall not where the circumstances admit, apply to shares  of a company that are held in a depository under a scheme provided under the Central Securities Depository Act, 2007 (Act 733).

40. Liability of members

(1) Before the winding up of a company, a member of the company with shares is liable to contribute the balance of the amount payable in respect of the shares held by that member in accordance with the terms of the agreement under which the shares were issued, or in accordance with a call validly made  by  the

(2)  Where a contribution has become due and payable in accordance with subsection (1), or  where, under the terms of an agreement with the company, a member has undertaken personal liability to make future payments in respect of shares issued  to  that member, the liability of the member shall continue although the shares held by that member are subsequently transferred or forfeited but the liability of the member  shall cease if and when the company receives  payment in full of all the  moneys in respect of the  shares.

(3) Subject to subsections (1) and (2), a member or past member is not liable to contribute   to the assets of the company except in the event of the company being wound up.

(4) In the event of a company being wound up, every present or past member is liable to  contribute to the assets of the company an amount sufficient for the payment of the  debts  and liabilities of the company and for the costs, charges and expenses of the winding up, and for the adjustment of the rights of the members and past members among themselves but subject to  the following qualifications:

(a) a past member is not liable to contribute if that member has ceased to be a member for a period of not less than one year before the commencement of the winding up;

(b) a past member is not liable to contribute unless it appears to the Court that the existing members are unable to satisfy the contributions required to be made by them in pursuance of this section;

(c) in the case of a company limited by shares, a contribution shall not be required from a member or past member exceeding the amount of money unpaid on the shares in respect of which that member is liable as a present or past member;

(d) in the case of a company limited by guarantee, a contribution shall not be required from a member or past member exceeding the amount of money undertaken to be contributed by that member to the assets of the company in the event  of the  company being wound up; or

(e) a sum of money due from the company to a member or past member, in the character of a member, by way of dividends or otherwise shall not be set-off against the amount of money for which that member is liable to contribute in accordance with this section,    but that amount of money shall be taken into account for the purposes of final    adjustment of the rights of the members and former members amongst themselves.

(5) For the purposes of this section, "past member" includes the estate of a deceased   member and where a person dies after becoming liable as a member or past member, the liability is enforceable against the estate of that member.

(6) Except as otherwise provided in this section, a member or past member of a company is not liable as a member or past member for any of the debts and liabilities of the company.

41. Companies ceasing to have members

If at any time a company ceases to have a member and it carries on business without at  least one member, every person who is a director of the company during the time that it so carries on business is jointly and severally liable for the payment of all the debts and  liabilities of the company incurred during  that  period.

Part F: Shares
42. Legal nature of shares

(1) The shares of a member in a company are movable property.

(2) The number of shares in a company and the rights and liabilities attaching to the shares are dependent on the terms of issue.

43. No par value shares

The shares created or issued under this Act are shares of no par value.

44. Issue of shares

(1) Subject to the registered constitution of a company, different classes of shares may be issued in a company at the times and for the consideration that the company shall determine and shall be paid for, at the times that are agreed between the member and the company.

(2) On the winding up of the company, every past and present shareholder of the company is liable to contribute to the assets of the company to the extent referred to in section 40.

45. Payment of shares

(1) Except on a capitalisation issue pursuant to subsection (1) of section 77, shares shall not be issued otherwise than for valuable consideration paid or payable to the company and unless otherwise agreed, shares shall be paid for in cash.

(2) Where a company agrees to accept payment for shares otherwise than wholly in cash, the company shall, within twenty-eight days after the allotment of the shares, deliver to the  Registrar for registration a contract in writing duly stamped evidencing the terms of the  agreement and the true value of the consideration or, if the agreement has not been reduced to writing, particulars in the prescribed form of the agreement duly stamped, as if it were a written agreement.

(3) The particulars referred to in subsection (2) shall not be required on a capitalisation issue of shares pursuant to subsection (1) of section 77.

(4) The statement in the agreement of the value of the non-cash consideration is sufficient evidence of the true value of the consideration, but when a company limited by shares is in the course of being wound up under the Bodies Corporate (Official Liquidations) Act, 1963 (Act 180), the liquidator or a creditor may apply to the Court and if the Court is satisfied that the true value of the consideration was less than stated, it may direct that the shares shall be treated as unpaid to the amount of money that it shall direct.

46. Return of issues

Where a company issues shares, other than a re-issue of treasury shares as defined in subsection (3) of section 61, the company shall, within twenty-eight days after  the  issue,  deliver to the Registrar for registration a return in the prescribed form showing, as at the  date of the  return,

(a) the amount of the stated capital, attributable to each of the items specified in subsection (1) of section 68;

(b) the number of the authorised shares of each class;

(c) the total number of the issued shares of each class and the amount of money paid on  the shares, distinguishing between the amount paid in cash and the amount paid  otherwise than in cash and, in the case of a company limited by shares, the amount of money remaining payable on the shares, distinguishing between the amount  presently due for payment and the amount not yet due for payment; and

(d) the total number of the treasury shares of each class.

47. Penalties for non-compliance with section 45 or 46

Where a company defaults in delivering a document required under section 45 or 46, the  company and every officer of the company who is in default is liable to pay to the Registrar,    an administrative penalty of twenty-five penalty units for each day during which the  default  continues.

48. Meaning of payment in cash

(1) For the purposes of this Act, shares have not been paid for in cash except to the extent that the company has actually received cash for the shares at the time  of, or subsequent to  the  agreement to issue  the

(2) Where shares are issued to a person who has sold or agreed to sell property or rendered  or agreed to render services to the company or to persons nominated by that person, the  amount of money of a payment made for the property or services  shall be deducted from the amount of a cash payment made for the shares and only the balance shall be treated as having been paid in cash for the shares despite  an exchange of cheques or any other securities for money.

49. Classification of shares

(1) The registered constitution of a company may provide for different classes of shares by attaching to certain of the shares preferred, deferred or any other special rights or restrictions, whether as regards dividend, voting, repayment or otherwise.

(2) Shares are not of the same class unless they rank at the same rate for all purposes.

50. Variation of class rights

(1) Where at  any  time the  shares  of a  company  are  divided  into  different  classes,  the  rights  attached  to  a  class  shall   not  be  varied  unless  otherwise  expressly provided  for  in the  constitution  of  a

(2) Where the constitution of a company expressly forbids a variation of the rights of a class, or contains provisions regarding that variation and expressly forbids  an amendment of the  provision, in respect of the variation of rights, the rights shall not be varied and the  provision  for variation  shall not be amended except  with the sanction of the Court under a  scheme  of arrangement in accordance with section 239.

(3) Except as provided in subsection (2), a company may, by special resolution, amend its constitution by inserting  in the constitution provisions regarding the variation of the rights of a class, or by modifying the terms of those provisions.

(4) An amendment under this section requires the prior written consent of the holders of at  least three-fourths of the issued shares of each class or the sanction of a special resolution of the holders of the shares of each class and shall be deemed, to be a variation of the rights  of each class.

(5) Despite a provision in the constitution of a company to the contrary, the rights attached to  a class of shares shall not be varied except with the written consent of the holders of at least  three-fourths of the issued shares of  that class, or the sanction of a  special resolution of the  holders of the shares of that class.

(6) A resolution of a company  the implementation of which would have the effect of

(a) diminishing the proportion of the total votes exercisable at a general meeting of the company by the holders of the existing shares of a class, or

(b) reducing the proportion of the dividends or distributions payable at any time to the holders of the existing shares of a class, is for the purposes of this Act, a variation of the rights of that  class.

51. Preference and equity shares

(1) In this Act, "preference share" means a share, which does not entitle the holder of the share to a right to participate beyond a specified amount of money in a distribution whether by way of dividend, on redemption, in a winding up, or otherwise; and any other share shall be referred to as an "equity share".

(2) A share that  is not a preference share shall be referred to as an "equity share".

(3) The meaning of "preference share" under subsection (1) shall apply  to whatever name  a company may designate in its constitution.

52. Suspension of voting rights of preference shares

(1) Despite section 34, the right of holders of preference shares to attend and vote at a general meeting of the company may be suspended on conditions.

(2) Despite a provision to the contrary in the constitution of a company, preference shares carry the right to attend general meetings and on a poll at those meetings to at least one vote per share in the following circumstances, but not otherwise:

(a) on a resolution during the period that the preferential dividend or a part of the preferential  dividend remains in arrears  and unpaid, the  period starting  from  a  date  not more than twelve months, or a lesser period that the constitution of a company   may provide, after the due  date of the dividend;

(b) on a resolution which varies the rights attached to those shares;

(c) on a resolution to remove an auditor of the company or to appoint another person in place  of that  auditor; or

(d) on a resolution for the winding up of the company or during the winding up of the

(3) Apart from the circumstances in section 34 and subject to subsections (1) and (2) of this  section, preference shares carry the right on a poll at a general meeting of the company to  one vote, only, in respect of each share.

(4) A special resolution of a company increasing the number of shares of a class may validly  resolve that an existing class of preference shares shall carry the right to the votes specified  in subsection (3) additional to one vote per share as shall be necessary in order to preserve  the existing  ratio  which the votes exercisable  by the holders  of those preference shares  at a general  meeting of the company bear to the total  votes exercisable at  the  meeting.

(5) For  the purposes  of subsection (2), a  dividend is due

(a) on the day immediately following the expiration of the year or other period; or

(b) where a company has a registered constitution, on the date appointed in the  constitution for the payment of the dividend for a year or other period whether or not  the dividend has been earned or declared.

53. Votes of equity shares

(1) Despite a provision to the contrary in the constitution of a company, equity shares  carry  the right  on  a poll  at a general meeting of the company to one vote only, in respect of each share subject to  section

(2) For the purposes of subsection (1), an alteration of the rights of issued preference  shares so that they become equity shares is an issue of equity shares.

54. Canons of construction of class rights

In construing the provisions of the constitution of a company in respect of the rights attached to shares, the following canons of construction shall be observed:

(a) Unless the contrary intention appears, a dividend is not payable on any shares unless the company resolves to declare that dividend;

(b) unless the contrary intention appears, a fixed preferential dividend payable on a class  of shares shall be cumulative; in other words, a dividend is not payable on any shares ranking subsequent to that class of shares until all the arrears of  the  fixed  dividend have been paid;

(c) unless the contrary intention appears, in a winding up, arrears of a cumulative preferential dividend whether or not earned or declared is payable up to the date of actual payment in the winding up;

(d) if a class of shares is expressed to have a right to a preferential dividend, then, unless the contrary  intention appears, that class does not have a  further right to participate in  dividends;

(e) if a class of shares  is expressed  to have preferential  rights to  payment  out  of the  assets  of the company  in  the  event  of  winding up,  unless  the contrary  intention  appears, that class  does not  have a further right to participate  in the distribution of assets  in  the  winding  up;

(f) in determining the  rights  of the  various  classes to  share in the distribution   of  the  property of the company on  a winding up, consideration shall  not  be  given  unless  the contrary intention appears, to whether or not the property represents  accumulated profit or surplus which would have been available for dividend while the company  remained a going concern; and

(g) subject to this section, the shares rank equally in all respects unless the contrary  intention appears.

55. Issue of share certificates

(1) Subject to the Central Securities Depository Act, 2007 (Act 733), a company shall, within two months after the issue of any of the shares of the company or after the registration of the transfer of a share, deliver to the registered holder of the share, a certificate certified by one director and the Company Secretary indicating

 (a) the number and class of shares held by that holder and the definitive numbers of the shares,

(b) the amount of money paid on the shares and the amount remaining unpaid, and

(c) the name and address of the registered holder.

(2) Where a share certificate is defaced, lost or destroyed, the company at the request of the registered holder of the shares, shall renew the certificate on payment of a fee prescribed by the company and on the terms as to evidence and indemnity and the payment of the out-of-pocket expenses of company of investigating evidence that the company may reasonably require.

(3) Where a company defaults in complying with this section, the company and an officer of the company who is in default are liable to pay to the Registrar, an administrative penalty of fifty penalty units.

(4) Where an application is made to the Court by a person entitled to have the certificate delivered to that person, the Court may order the company to deliver the certificate and may require the company and that officer to bear the costs of, and incidentals to the application.

56. Effect of share certificates

(1) Statements made in a share certificate under the common seal of the company or as certified by two directors and the Company Secretary of the company, are prima facie evidence of the title to the shares of the person named in the certificate as the registered holder and of the amounts of money paid and payable on the certificate.

(2) Where a person changes a position to the detriment of that person in reliance in good faith on the continued accuracy of the statements made in the certificate, the company is estopped in favour of that person from denying the continued accuracy of those statements and shall compensate that person for the loss suffered by that person in reliance on those statements and which that person would not have suffered bad the statement been or continued to be accurate.

(3) Subsections ( l) and (2) do not affect a right the company may have to be indemnified by any other person.

(4) The provisions of subsections ( l) to (3) do not apply in the case of shares which can be transferred through a scheme of a central depository under the Central Securities Depository Ace, 2007 (Act 733) or any other relevant enactment.

57. Reserve liability

(1) A company limited by shares may, by special resolution, determine that a portion of the unpaid liability on its shares which has not already been called up shall not be capable of being called up except in the event, and for the purpose, of the company being wound up.

(2) Where a resolution is passed, that portion shall not be capable of being called up except in the event and for the purpose stated in that subsection.

58. Prohibited transactions in shares

(1) Except as provided in this Act, a company shall not,

(a) alter the number of its shares or the amount of money remaining payable on those shares;

(b) release a shareholder or former shareholder from a liability on the shares;

(c) provide financial assistance, directly or indirectly, for the subscription or purchase of the shares of the company or the shares of its holding company; or

(d) acquire, by way of purchase or otherwise, any of its issued shares or any shares of its holding company.

(2) For the purposes of paragraph (d) of subsection (1), shares are, acquired by the company if they purport to be held in trust for the company although they are registered in the names of nominees.

(3) Subsection (1) does not prohibit a company from voluntarily acquiring its own shares on the conversion of the company to a company limited by guarantee in accordance with section 9.

(4) In the event of a breach of this section,

(a) if the breach is of paragraph (a) or {b) of subsection (1), the purported alteration or release is void and every officer of the company who is in default is liable to pay to the Registrar, an administrative penalty of five hundred penalty units;

(b) if the breach is of paragraph (c) or (d) of subsection (1), then,

(i) knowledge of the breach, voidable by the company and a payment made by the company in respect of that transaction is immediately repayable with interest at the yearly interest rate applicable to the ninety-one day government treasury bill or a higher rate that the Court may order, and

(ii) whether or not the transaction is avoided, every officer of the company who is in default is liable to pay to the Registrar, an administrative penalty of five hundred penalty units or twice the amount of money of a provision or payment made by the company in respect of the transaction, whichever is the greater.

59. Alteration of number of shares

(1) Subject to subsection (3), a company may

(a) increase the number of the shares of the company by creating new shares; or

(b) reduce the number of the shares of the company by cancelling shares which have not been taken or agreed to be taken by a person or by consolidating its existing shares, whether issued or not, into a smaller number of shares.

(2) On a consolidation of shares

(a) the amounts of money paid,

(b) an unpaid liability on the shares, and

 (c) a fixed sum of money by way of dividend or repayment to which the shares were entitled shall also be consolidated.

(3) Unless otherwise provided in the constitution of a company, the directors may issue shares with rights or restrictions as may be determined by the directors, subject to the provisions of this Act.

60. Financial assistance for acquisition of shares

Section 58 does not prohibit any of the following transactions:

(a) the payment or commission or brokerage to a person in consideration of that person subscribing or agreeing to subscribe or procuring or agreeing to procure subscriptions for any shares in the company, where the payment of commission or brokerage does not exceed ten per cent of the price at which the shares are issued or a lesser rate as may be specified in the constitution of the company;

 (b) where the lending of money is part of the ordinary business of the company, or lending of money is the ordinary course of business although the money may be used for the subscription or purchase of shares in the company or its holding company

(c) the provision by a company of money for the purchase or subscription of shares to be held for the benefit of persons genuinely in the employment of the company or an associated company including a director holding a salaried employment in the company or an associated company in accordance with a scheme for the time being in force;

(d) the advancing by a company of loans to persons, other than directors, genuinely in the employment of the company or an associated company with a view to enabling those persons to purchase or subscribe for shares to be held by themselves beneficially and not as nominees for the company or any other person;

(e) the payment by a company of a lawful dividend on the shares of the company although the dividend received by a shareholder is used to discharge a liability on the shares of that shareholder or to repay money borrowed for the purpose of subscribing or purchasing shares;

(f) in the case of a public company some or all of whose equity shares are dealt with on an approved stock exchange, or in respect of which an application has been made to an approved stock exchange for permission to. deal in those shares, the payment of any commissions, fees, costs and expenses and the giving of any indemnities and warranties in each case to a person arranging or otherwise involved in an underwriting, placing or sale of securities in the company or any other similar transaction, where

(i) an application for permission to deal in those securities has been or is to be made to an approved stock exchange, and

(ii) any other financial assistance is given in good faith in the interests of the company.

61. Acquisition by company of its own shares

(1) Despite section 58 a company may,

 (a) create and issue preference shares which are, or at the option of the company are liable, to be redeemed and may convert existing shares, whether issued or not, into those redeemable preference shares subject to sections 62 to 65;

 (b) purchase its own shares subject to sections 63 to 67;

(c) acquire its own shares by a voluntary transfer to the company or to nominees for the company subject to compliance with sections 62 to 65; and

(d) acquire its own shares pursuant to the buy-out provisions in section 222.

(2) For the purposes of subsection (1), shares shall not be redeemed, purchased or acquired by the company so long as there is an unpaid liability on those shares.

(3) A company may forfeit the shares issued with an unpaid liability for non-payment of the sums of money due and payable on those shares.

(4) On redemption, purchase, acquisition or forfeiture, shares shall be available for re-issue by the company unless a company by amendment of the constitution of the company cancels those shares.

(5) Shares which arc cancelled by virtue of the constitution of the company, shall until re-issued or cancelled, be referred to as treasury shares.

(6) Except as provided in section 69, a redemption, purchase, an acquisition or a forfeiture by the company of the shares of the company, or the cancellation of shares so redeemed, purchased, acquired or forfeited shall not reduce the stated capital of the company.

(7) Voting rights shall not be exercised and dividends shall not be payable on treasury shares, and except where otherwise stated, treasury shares shall not be treated as issued shares within the meaning of this Act.

62. Redemption of redeemable preference shares

(1) Despite a provision in the constitution of the company to the contrary, a company shall not redeem any of its redeemable preference shares except,

(a) out of a credit balance on the share deals account referred to in section 65 or out of transfers to that account in the manner referred to in that section from retained earnings as defined in section 71; or

(b) out of the proceeds of a fresh issue of shares made for the purposes of the redemption not more than twelve months before the date of redemption.

(2) Where redeemable preference shares have become redeemable and the funds of the company are sufficient to entitle the company to redeem the whole of the shares due for redemption, the holder of those shares may serve notice on the company requiring it to effect the redemption.

(3) Where the company fails to redeem the shares within twenty-eight days of the service of the notice, the shareholder who has served the notice may apply to the Court on behalf of that shareholder and the other shareholders whose shares are due for redemption; and the Court, if satisfied that the conditions of this subsection are fulfilled, may order the company to redeem the shares and may require the company and an officer of the company who is in default to bear the costs of, and incidental to, the application.

(4) Section 205 shall apply to an application to the Court under subsection (3).

63. Purchase by a company of its own shares

Despite a provision of the constitution of the company to the contrary, a company shall not purchase any of the shares of the company except where

 (a) shares are only purchased out of a credit balance on the share deals account referred to in section 65, or out of transfers to that account in the manner referred to in that section from retained earnings;

(b) redeemable preference shares are not purchased at a price greater than the lowest price at which they are then redeemable or will be redeemable at the next date at which they are due or liable to be redeemed; or

 (c) the purchase is not made in breach of section 64.

64. Limit on number of shares acquired

(1) A transaction shall not be entered into by or on behalf of a company by which the total number of its shares, or of its shares of any one class, held by persons other than the company or its nominees becomes less than eighty-five per cent of the total number of shares, or of shares of that class, which have been issued

(2) For the purposes of subsection ( 1 ), redeemable preference shares shall be disregarded.

(3) Where, after shares of a class have been issued and the number of those shares has been reduced, subsection (1) shall apply as if the number originally issued, including shares of the class cancelled before the reduction took effect, had been the number as so reduced.

65. Share deals account

(1) When a company first redeems or purchases any of its shares, otherwise than on a redemption of redeemable preference shares out of the proceeds of a fresh issue of shares in accordance with paragraph (b) of subsection (1) of section 62, it shall open a share deals account and shall credit to that account a sum of money not less than the amount of money to be expended on the redemption or purchase by transferring that sum from retained earnings as defined in section 71.

(2) There shall be debited to the share deals account the sums of money which the company shall from time to time expend on the than on a redemption of redeemable preference shares out of the proceeds of a fresh issue of shares in accordance with paragraph (b) of subsection (1) of section 62.

(3) The net price or the value of the consideration received by the company on the re-issue of any of the treasury shares of the company shall be credited to the share deals account.

(4) lf at any time the total amount of money to be debited to the share deals account under subsection (2) exceeds the amount of money credited to that account in accordance with subsections (1), (2) and (3), an amount of money equal to the excess shall be transferred to the credit of that account from retained earnings, and a purchase or redemption, otherwise than a redemption of redeemable preference shares out of the proceeds of a fresh issue of shares in accordance with paragraph (b) of subsection ( l) of section 62, shall not be made by the company unless its retained earnings is sufficient to enable the transfer to be made.

(5) An amount of money shall not be debited or credited to the share deals account, otherwise than in accordance with subsections (1), (2), (3) and (4) except on a transfer to stated capital in accordance with section 68 or under an order of the Court under section 80 or 239.

(6) A true copy of the share deals account, showing the number of shares involved in each transaction and the price paid or received for those shares, shall be kept in a separate book at the registered office of the company and shall during business hours, be open to the inspection of a member without charge and of any other person on payment of a fee prescribed by the company for each inspection unless otherwise subject to reasonable restrictions expressed in the constitution of a company.

(7) Not less than two hours in each day, other than a Saturday, Sunday or a public holiday shall be allowed for the inspection.

(8) A member or any other person is entitled to be furnished, within ten days after the member or that person has made a request in that behalf to the company, with a copy of the share deals account or a part of the share deals account at a fee prescribed by the company.

(9) Where an inspection required under subsection (6) is refused, or where a copy required to be sent under subsection (8) is not sent within the proper time, the company and every officer of the company who is in default is liable to pay to the Registrar, an administrative penalty of twenty-five penalty units for each day during which the default continues, and the Court may order an immediate inspection or furnishing of a copy.

66. Modification of sections 61 to 65 in relation to authorised mutual funds

Any of the provisions of sections 61 to 65 may be waived or modified by order of the Registrar in relation to a company which is for the time being an authorised mutual fund as defined in section 216 of the Securities Industry Act, 2016 (Act 929).

67. Acquisition of shares of holding company

(1) Despite section 58, a company which is a subsidiary may acquire shares in its holding company, where the subsidiary company is concerned as a personal representative or trustee unless the holding company or a subsidiary of the holding company is beneficially interested otherwise than by way of security for the purposes of a transaction entered into by the holding company or subsidiary of the holding company in the ordinary course of a business which includes the lending of money.

(2) A subsidiary which is a holder of shares of its holding company or a subsidiary which acquired shares in its holding company before it became a subsidiary of that holding company may continue to hold those shares but, subject to subsection (1), shall not have a right to vote at meetings of the holding company or a class of shareholders of the holding company, and shall not acquire any future shares in the holding company, except on a capitalisation issue in accordance with subsection (1) of section 77.

Part G: Stated Capital and Dividends
68. Meaning of "stated capital"
    1. The stated capital of a company with shares consists of the sum of the following items:

 (a) the total proceeds of every issue of shares for cash, including the amounts paid on calls made on shares issued with an unpaid liability, less deductions for transactions costs that are direct and incidental to share issue,

 (b) the total value of the consideration, as stated in the agreement, received for every issue of shares otherwise than for cash, and

 (c) the total amount which the company by special resolution resolves to transfer to stated capital from reserves, as defined in section 70 including the credit balance on the share deals account referred to in section 65.

(2) Paragraph (a) or (b) of subsection (1) does not require the proceeds or value of the consideration received on the re-issue of treasury shares to be added to stated capital.

(3) For the purpose of subsection (2), when a company having treasury shares makes an issue of shares, the issue is, until the number of treasury shares of that class is exhausted, an issue of those treasury shares and not a first issue of further shares, unless the company otherwise determines.

(4) The amount of the stated capital may be reduced to the extent and in the manner provided by section 69 and in the buy-out provisions in sections 220 to 226.

(5) Within twenty-eight days after the raising of a stated capital, the company shall deliver to the Registrar for registration particulars in the prescribed form showing the amount of money so raised and the total stated capital, distinguishing between the amounts attributable to each of the items specified in subsection (1).

(6) Where the company defaults in delivering to the Registrar the particulars required under subsection (5), the company and every officer of the company that is in default is liable to pay to the Registrar, an administrative penalty of twenty-five penalty units for each day during which the default continues.

69. Reduction of stated capital

(1) Despite subsection (4) of section 61, the stated capital of a company shall be deemed to be reduced by the amount of money by which a redemption of redeemable preference shares is made out of the proceeds of a fresh issue of shares made for the purposes of the redemption not more than twelve months before the date of redemption.

(2) An unlimited company may, reduce its stated capital by ordinary resolution.

(3) Subject to subsections (1) and (2) and to section 66, a company may not reduce its stated capital except in accordance with sections 78 to 82.

70. Meaning of "reserves"

The reserves of a company with shares is the amount of money by which the assets of the company, other than unpaid calls and other sums of money payable in respect of the shares of the company and not including treasury shares, less the liabilities of the company, as shown in the accounts of the company prepared and audited in accordance with sections 127 to 142, exceed the stated capital of the company.

71. Meaning of "retained earnings"

The retained earnings of a company with shares is the reserves, as defined in section 70, less the amounts of money attributable to

(a) an unrealised appreciation in the value of an asset of the company, other than an appreciation in the value of an asset as would, under normal accounting principles, be credited to the income statement, unless the amount of the appreciation bas been transferred to stated capital; and

 (b) a balance standing to the credit of the share deals account immediately before the ascertainment of the retained earnings.

72. Legality of dividend payments

(1) Except in a winding up, a company shall not pay a dividend to the shareholders of the company or, except in accordance with sections 78 to 82 make a return or distribution of any of the assets of the company to the shareholders of the company unless, the company has complied with the distribution test.

(2) Where a payment, return or distribution is made in contravention of this section,

 (a) every director of the company who is in default is jointly and severally liable to restore to the company the total amount of money by which the payment, return or distribution contravenes this section, with interest on that amount at the yearly interest rate of the ninety-one day government treasury bill;

 (b) unless, within twelve months after the date of the payment, return or distribution, the total amount of money with interest on the payment, return or distribution is restored to the company by the directors in accordance with paragraph (a) of this subsection, every shareholder is liable to restore to the company, the amount of money received by the shareholder in contravention of this section; and

(c) if the directors of the company make a restoration to the company in accordance with paragraph (a) of this subsection, they shall have a right to be indemnified by a shareholder who has received an amount of money knowing that it contravenes this section to the extent of the amount received by the shareholder with interest on that account at the yearly interest rate of the ninety-one day government treasury bill.

(3) A shareholder, an officer or a creditor of the company or the Registrar may apply to the Court for an injunction restraining a company from paying a dividend or from making a return or distribution in contravention of this section or for an order for restoration in accordance with subsection (2).

(4) An application by a shareholder or creditor shall be made in a representative capacity on behalf of the shareholder or the creditor and the other shareholders or creditors of the company and section 205 shall apply.

(5) In relation to public companies, paragraph (b) of subsection (2) shall be modified as stated in section 320.

73. Unclaimed dividends accounts

(1) Where any dividend declared by a company cannot be paid by reason of the dividends being unclaimed by the member entitled to the dividend and remains unclaimed for a period of three months, the company shall forthwith

 (a) open an interest bearing unclaimed dividend account, and

 (b) credit to that account the total amount of the unclaimed dividend of its shareholders unless that account has already been opened.

(2) Where payment of the dividend cannot be made or is not claimed within a further period of twelve months after the transfer made under paragraph (b) of subsection (1), the company shall pay to the Registrar the total amount of the unclaimed dividend plus interest accrued on the amount.

(3) The Registrar shall pay into the account under subsection (4)

 (a) the amount received under subsection (2), and

 (b) the amount received under subsection (3) of section 74.

(4) The Registrar shall with the approval of the Board open an interest bearing bank account for the safe keeping of moneys received from any company under subsection (2)

(5) The Registrar is responsible for the moneys lodged and disbursed from the interest bearing account.

(6) The company shall on the date of the payment under subsection (2), notify the respective shareholder or the estate of the shareholder at the last address known to the company of the payment made in respect of the dividend.

(7) The shareholder or the estate of the shareholder shall on providing satisfactory evidence, be entitled to make a claim for the dividend and any accrued interest during the period that the

 (a) company had possession of the dividend under subsection (1); and

 (b) Registrar had possession of the dividend under subsection (3).

(8) The Registrar shall publish annually in the Companies Bulletin and in a daily newspaper of national circulation, details of shareholders whose dividends have been transferred to the Registrar for safe keeping.

74. Management by Registrar of unclaimed dividends account

(1) The Registrar shall keep unclaimed dividends lodged in the account under subsection (4) of section 73 for, seven years.

(2) The Registrar shall on the expiration of the seven year period referred to in subsection (1)

(a) transfer to the Consolidated Fund fifty percent of the total amount of money lodged in the interest bearing account under subsection (4) of section 73, and

(b) donate or apply fifty percent of the total amount of money lodged in the interest bearing account under subsection (4) of section 73, for the purpose of investor education, research, entrepreneurial development and advancement in company law.

(3) Where a company on the commencement of this Act has in the possession of the company unclaimed dividends, the company shall immediately transfer the total amount of the dividends to the Registrar to be applied in accordance with subsections (1) and (2).

75. Prohibition of payment of dividends by companies limited by guarantee

(1) A company limited by guarantee shall not at any time pay a dividend or make a distribution or return of the assets of the company to members of the company.

(2) Where a payment, distribution or return is made in contravention of subsection (1), a member to whom it is made shall restore same to the company with interest at the yearly interest rate of the ninety-one day government treasury bill, and every officer of the company who is in default is liable to pay to the Registrar, an administrative penalty of five hundred penalty units.

76. Declaration of dividends

(1) Subject to sections 72 and 75, and in the case of a private company, its registered constitution where applicable, a company may, by ordinary resolution, declare dividends in respect of a year or any other specified period, but a dividend shall not exceed the amount recommended by the directors.

(2) In relation to public companies, subsection (1) shall be supplemented by section 321.

(3) A dividend shall be paid within sixty days after the resolution of the shareholders confirming payments or after dividends have become payable.

(4) Where a dividend is to be paid in accordance with subsection (3), the shareholders shall be notified of the amount of dividend recommended by directors for payment.

(5) A registered constitution of a company may prescribe modes for the payment of dividend without reference to the resolution of the shareholders.

77. Capitalisation issues and non-cash dividends

(1) When a company resolves to transfer a sum of money from reserves to stated capital pursuant to paragraph (c) of subsection (1) of section 68, the company, on the recommendation of the directors may, by the same or a subsequent special resolution, resolve that unissued shares in the company be issued and credited as fully paid to the members who would have been entitled to receive that sum of money had it been lawfully distributed by way of dividend and in the same proportions so that the sum of money so transferred to stated capital shall be deemed to be paid, otherwise than in cash, on the shares.

(2) An issue under subsection (1) shall be referred to as a capitalisation issue.

(3) A company, on the recommendation of the directors, may resolve that a sum of money standing to the credit of the retained earnings of the company, and which could have lawfully been distributed by way of dividend shall be applied, on behalf of the members who would have been entitled to receive same if it had been distributed by way of dividend, in paying up amounts of money for the time being unpaid on the shares held by the members, and that sum shall be deemed to have been paid on a call made on those shares and shall be transferred to stated capital pursuant to paragraph (a) of subsection (1) of section 68.

(4) A resolution of a company lawfully declaring a dividend may, on the recommendation of the directors, direct payment wholly or partly by distribution of securities for money, or of fully paid, but not partly paid, shares or debentures of any other body corporate, or of fully paid debentures of the company of a nominal amount equal to the amount so directed to be paid.

(5) The directors shall give effect to the resolution and

  (a) may make a provision that they think fit for the case of the shares, debentures, or securities for money becoming distributable in fractions,

(b) may issue fractional certificates or, in the case of a distribution in accordance with subsection (4), but not in the case of a capitalisation issue in accordance with subsection (1), and

(c) may sell the shares, debentures or securities for money represented by those fractions and distribute the net proceeds of the sale among the members otherwise entitled to those fractions in due proportions.

(6) An allotment of shares or debentures or a pay-up of shares pursuant to the resolution, may be made without obtaining the individual consents to that allotment of the members concerned and a transfer of shares or debentures in any other body corporate may be person nominated in writing by the directors and the signature of that person shall be effective and binding on all the members.

Part H: Resolutions Reducing Capital, Shares or Liability
78. Resolutions requiring confirmation of Court

(1) Subject to confirmation by the Court, a company limited by shares may, by special resolution,

(a) reduce the stated capital of the company in any way;

(b) extinguish or reduce the unpaid liability on any of the shares of the company;

(c) resolve to pay or return to the shareholders any of the assets of the company which are in excess of the requirements of the company; or

 (d) alter the constitution of the company by cancelling any of the shares of the company.

(2) A resolution under subsection (1) shall in this Act be referred to as a resolution requiring confirmation.

(3) Where the resolution requiring confirmation varies the rights attached to a class of shares, the resolution shall not be effective unless section 50 has been complied with.

(4) This section does not require confirmation by the Court of a transaction validly effected under sections 72 and 75 to 77.

(5) The provisions of this section and sections 139 to 141 and 156 are subject to the Securities Industry Act, 2016 (Act 929).

79. Application for confirming order

(1) Where a company passes a resolution requiring confirmation, the company may apply to the Court for an order confirming the resolution.

(2) Where the resolution requiring confirmation involves diminution of liability in respect of shares with an unpaid liability, or a payment or return to any shareholder, and in any other case if the Court so directs, the following provisions shall have effect unless, having regard to the special circumstances of the case, the Court otherwise directs:

(a) a creditor of the company who at the date fixed by the Court is entitled to a debt or claim which if that date were the commencement of the winding up of the company, would be admissible in proof against the company, is entitled to oppose the confirmation;

(b) the Court shall settle a list of creditors so entitled to oppose, and for that purpose shall ascertain, as far as possible without requiring an application from a creditor, the names of those creditors and the nature and amount of their debts or claims, and may publish notices fixing a day or days within which creditors not entered on the list are to claim to be so entered, or are to be excluded from the right of opposing the confirmation; or

(c) where a creditor entered on the list whose debt or claim is not discharged or has not determined, does not consent to the confirmation, the Court may dispense with the consent of that creditor on the company securing payment of the debt of that creditor or claim by appropriating, as the Court may direct, the following amount:

(i) if the company admits the full amount of the debt or claim, or, though not admitting, is willing to provide for the debt or claim, then the full amount of the debt or claim; or

(ii) if the company does not admit and is not willing to provide for the full amount of the debt or claim, or if the amount is contingent or not ascertained, then an amount fixed by the Court after the like inquiry and adjudication as if the company were being wound up under the Bodies Corporate (Official Liquidations) Act, 1963 (Act 180).

(3) The Court may refer the application to the Registrar who shall appoint one or more competent reporters to investigate the fairness of the resolution for reduction and to report on the resolution to the Court.

(4) The remuneration of the reporters shall be fixed by the Registrar and the expenses of the investigation shall be borne by the company.

80. Order confirming the resolution

The Court may make an order confirming the resolution on the terms and conditions specified by the Court, if satisfied,

(a) with respect to every creditor of the company who under section 79 is entitled to oppose, that the consent of the creditor has been obtained or that the debt or claim of that creditor has been discharged or secured,

 (b) that sections 78 and 79 have been duly complied with, and

(c) that the resolution requiring confirmation is fair and equitable.

81. Order and minute to be registered

(1) The Registrar, on production of an order of the Court confirming the resolution requiring confirmation and the delivery to the Registrar of a copy of the order and of a minute, approved by the Court, showing,

(a) the new stated capital of the company,

(b) the number of authorised and issued shares and the classes into which they are divided, and

 (c) the amount of money deemed to be paid and the unpaid liability on the issued shares, distinguishing the amount paid in cash and the amount paid otherwise than in cash, shall register the order and the minute and publish the particulars stated in the minute in the Companies Bulletin.

(2) On registration of the order and minute, the resolution for reduction shall take effect.

(3) The Registrar shall personally certify the registration of the order and the minute, and the certificate is conclusive evidence that the requirements of this Act with respect to the resolution requiring confirmation have been complied with and that the stated capital and shares of the company are as stated in the minute.

82. Protection of creditors

(1) Where a creditor, entitled in respect of a debt or claim to oppose the confirmation, is by reason of ignorance of the proceedings for confirmation, or of their nature and effect with respect to the claim of that creditor, not entered on the list of creditors and, after the confirmation, the company fails to pay the amount of the debt of that creditor or claim, then,

 (a) a person who was a member of the company at the date of the registration of the order and minute, is liable to contribute for the payment of that debt or claim, an amount of money not more than the amount which that person would have been liable to contribute on the winding up of the company had that commenced immediately before the date of the registration; and

(b) where the company is wound up, the Court, on the application of that creditor and proof of the ignorance of the creditor, may settle a list of persons so liable to contribute and make and enforce calls and orders on those persons as if they were members liable to contribute in accordance with section 40.

(2) Subsection (1) does not affect the rights of the members among themselves and, except as provided in subsection (1), a member or past member after the date of the registration of the order and minute is not liable in respect of a share to a call or contribution exceeding in amount the unpaid liability on that share as set out in the minute.

(3) An officer of the company who,

(a) wilfully conceals the name of a creditor entitled to oppose the confirmation, or

 (b) wilfully misrepresents the nature or amount of the debt or claim of a creditor, or

 (c) aids, abets, or is privy to a concealment or misrepresentation, commits an offence and is liable on summary conviction to a fine of not less than two hundred and fifty penalty units and not more than five hundred penalty units or to a term of imprisonment of not less than one year and not more than two years or to both the fine and the imprisonment and is personally liable to pay the creditor the amount of the debt or claim of the creditor to the extent to which the debt or claim is not paid by the company.

Part I: Debentures and Debenture Stock
83. Issue of debentures or debenture stock

(1) A company may raise a loan capital by the issue of a debenture or of a series of debentures or of debenture stock.

(2) Debentures of the same series shall rank at the same rate in all respects although they may be issued on different dates.

(3) Instead of issuing debentures acknowledging separate loans to the company, the loans may be funded by the creation of debenture stock of a prescribed amount parts of which, represented by debenture stock certificates, may be issued to separate holders.

(4) Debenture stock shall be created by deed under the common seal of the company or certified by the signatures of two directors and the Company Secretary in the form of a deed poll or of an indenture in favour of trustees for debenture stockholders.

(5) A debenture holder is not a member of the company and, despite a provision in the debenture or the constitution of the company, is not entitled to attend and vote at a general meeting of the company.

84. Specific performance of contract for debentures

A contract with a company to take up and pay for any debenture of the company may be enforced by an order for specific performance.

85. Documents of title to debentures

(1) Subject to the Central Securities Depository Act, 2007 (Act 733) a company shall, within two months after the allotment of any of its debentures, or after the registration of the transfer of any debentures, deliver to the registered holder of the debentures, the debentures or a certificate of the debenture stock under the common seal of the company or as certified by two directors and the Company Secretary of that company.

(2) Where a debenture or debenture stock certificate is defaced, lost or destroyed, the company, at the request of the registered holder of the debenture, shall issue a certified copy of the debenture or renew the debenture stock certificate on payment of a fee prescribed by the company and on the terms, as to evidence and indemnity and the payment of the out-of-pocket expenses of the company investigating the evidence, that the company may reasonably require.

(3) Where a company defaults in complying with this company and an officer of the company that is in default is liable to pay to the Registrar, an administrative penalty of two hundred and fifty penalty units.

(4) On an application by a person entitled to have the debentures or debenture stock certificate delivered to that person, the Court may order the company to deliver the debenture stock certificate and may require the company and that officer to bear the costs of, and incidental to, the application.

86. Effect of statements in debentures

(1) Statements made in debentures or debenture stock certificates, including statements made electronically are prima facie evidence of the title to the debentures of the person named in the statement as the registered holder and of the amounts so secured.

(2) Where a person changes the position of that person in reliance in good faith on the continued accuracy of the statements made in the debenture or debenture stock certificate, the company is estopped in favour of that person from denying the continued accuracy of the statements and shall compensate that person for a loss suffered by that person in reliance on that accuracy, and which that person would not have suffered had the statement been or continued to be accurate.

(3) Subsection (2) does not derogate from a right the company may have to be indemnified by any other person.

87. Perpetual debentures

A condition contained in a debenture or in a trust deed for securing any debentures, shall not be invalid by reason of the fact that the debentures are by that condition made irredeemable or redeemable only on the happening of a contingency, however remote, or on the expiration of a period however long.

88. Convertible debentures

Subject to the Central Securities Depository Act, 2007 (Act 733), debentures may be issued on the terms that in lieu of redemption or repayment the debentures may, at the option of the holder or the company, be converted into shares in the company on the terms that are stated in the debentures.

89. Secured or unsecured debentures

(1) Debentures may either be secured by a charge over the property of the company or may be unsecured by a charge.

(2) Debentures may be secured by a fixed charge on some property of the company or a floating charge over the whole or a specified part of the undertaking and assets of the company, or by both a fixed charge on a property and a floating charge.

(3) A charge securing debentures becomes enforceable on the occurrence of the events specified in the debentures or the deed securing the debentures.

(4) Where legal proceedings are brought by a debenture holder to enforce the security of a series of debentures of which that holder holds part, the debenture holder shall sue in a representative capacity personally and on behalf of the other debenture holders of that series, and section 205 shall apply.

(5) Where debentures are secured by a charge, sections 110 to 121 relating to registration of particulars of charges, shall apply.

90. Meaning of "floating charge"

(1) Subject to subsection (2), a floating charge is an equitable charge over the whole or a specified part of the undertaking and assets of the company both present and future.

(2) A floating charge does not preclude the company from dealing with the assets of the company until,

(a) the security becomes enforceable and the holder of the security pursuant to a power in that behalf in the debenture or the deed securing same, appoints a receiver or manager or enters into possession of those assets;

(b) the Court appoints a receiver or manager of the assets on the application of the holder; or

(c) the company goes into liquidation.

(3) On the happening of an event specified in subsection (2), the charge crystallises and becomes a fixed equitable charge on those of the assets of the company that are subject to the charge.

(4) Where a receiver or manager is withdrawn with the consent of the chargee, or the chargee withdraws from possession, before the charge has been fully discharged, the charge ceases to be a fixed charge and reverts to a floating charge.

(5) A fixed charge on a property has priority over a floating charge affecting that property unless the terms on which the floating charge was granted, prohibited the company from granting a later charge having priority over the floating charge and the person in whose favour that later charge was granted had actual notice of that prohibition at the time when the charge was granted to that person.

91. Powers of the Court

(1) Where a fixed or floating charge becomes enforceable, the Court may appoint a receiver and, in the case of a floating charge, a receiver and manager of the assets subject to the charge.

(2) In the case of a floating charge, the Court may, although the charge has not become enforceable, appoint a receiver or manager if satisfied that the security of the debenture holder is in jeopardy.

(3) The security of the debenture holder is in jeopardy if the Court is satisfied that events have occurred or are about to occur which render it unreasonable in the interests of the debenture holder that the company should retain power to dispose of its assets.

(4) A receiver or manager shall not be appointed as a means of enforcing debentures not secured by a charge.

92. Payment of preferential creditors out of assets subject to a floating charge

(1) Where a receiver is appointed on behalf of the holders of the debentures of the company secured by a floating charge or possession is taken by or on behalf of those debenture holders of a property subject to the charge, the debts which in a winding up are, under section 41 of the Bodies Corporate (Official Liquidations) Act, 1963 (Act 180) to be paid in priority to any other debts, shall be paid out of the assets coming to the hands of the receiver or any other person taking that possession in priority to a claim for principal or interest in respect of the debentures.

(2) Where the receiver or any other person taking possession as provided for in subsection (1) makes a repayment in respect of the debenture before discharging the debts having priority in accordance with subsection (1), the receiver or that person is personally liable to discharge the debts to the extent of the repayment made by the receiver or that person.

(3) The periods of time mentioned in section 41 of the Bodies Corporate (Official Liquidations) Act, 1963 (Act 180) shall be reckoned from the date of the appointment of the receiver or possession being taken.

(4) The payments made under this section shall be recouped as far as may be out of the assets of the company available for payment of general creditors.

93. Limitation of efficacy of floating charges in liquidations

Where the winding up of the company commences within twelve months of the creation of a floating charge on the undertaking or property of the company, the charge is invalid, unless it is proved that the company was solvent immediately after the creation of the charge, except to the amount of the cash paid to the company at the time of, or subsequent to, the creation of the charge and in consideration for the charge, together with interest on that amount at the yearly interest rate applicable to the ninety-one day government treasury bill.

94. Appointment of a receiver

The appointment of a receiver by or a manager on behalf of a debenture holder shall be in accordance with sections 26 l to 263.

95. Trustee for debenture holder

(1) Whether or not a debenture is secured by a charge over the property of the company, the debenture may be secured by a trust deed appointing trustee for a debenture holder.

(2) A trustee shall safeguard the rights of the debenture holder and, on behalf of and for the benefit of the debenture holder, exercise the rights, powers, and discretion conferred on them by the trust deed.

(3) Charges securing a debenture may be created in favour of the debenture holder by vesting the debenture in the trustee.

(4) A provision contained in a trust deed or in a contract with a holder of a debenture secured by a trust deed is void in so far as it would have the effect of exempting a trustee of the holder from, or indemnifying the trustee against, liability for a breach of trust or failure to show the degree of care and diligence required of the trustee as trustee having regard to the powers, authorities or discretion conferred on the trustee by the trust deed.

(5) Subsection (4) does not invalidate a release otherwise validly given in respect of anything done or omitted to be done by a trustee on the agreement to that release, of a majority of not less than three-fourths in value of the debenture holders present in person, or where proxies are permitted, by proxy at a meeting summoned for the purpose.

(6) Despite the provisions in the debenture or trust deed, the Court may, on the application of a debenture holder or of the Registrar, remove a trustee and appoint another trustee in the place of the removed trustee if satisfied that the first mentioned trustee has an interest which conflict or may conflict with the interest of the debenture holder or that for a sufficient reason, it is desirable to remove that trustee.

(7) Where an application is made under subsection (6) by a debenture holder, the Court may order the applicant to give security for the payment of the costs of the trustee and may direct that the application shall be heard in chambers.

(8) Where a trustee dies or retires, the Registrar may appoint another trustee in the place of the trustee who has died or retired at any time before the appointment of another trustee in accordance with a provision to that effect in the trust deed.

96. Meetings of debenture holders

(1) The terms of the debentures or trust deed may provide for the convening of general meetings of the debenture holders and for the passing, at those meetings, of resolutions binding on the holders of the debentures of the same class.

(2) Whether or not the debentures or trust deed contains the provisions referred to in subsection (I), the Registrar may at any time direct a meeting of the debenture holders of a class to be held and conducted in the manner that the Registrar thinks fit, to consider the matters which the Registrar or the trustees, shall bring before the meeting, and may give the ancillary or consequential direction that the Registrar thinks fit.

97. Re-issue of redeemed debentures

(1) Where a company redeems a debenture previously issued, the company may, subject to subsection (5), re-issue that debenture.

(2) The re-issue may be made either by re-issuing that debenture or by issuing another debenture in place of the redeemed debenture.

(3) On re-issue, the person entitled to the debenture has the same priority as if the debenture had never been redeemed.

(4) The re-issue of a redeemed debenture shall be treated as the issue of a new debenture for the purposes of stamp duty but not for any other purpose including a provision limiting the amount or number of debentures to be issued.

(5) For the purposes of subsection (4), a person lending money on the security of a re-issued debenture which appears to be duly stamped may give the debenture in evidence in any proceedings without payment of the stamp duty or a penalty unless that person had notice, or with due diligence might have discovered that the debenture was not duly stamped, but the company in either case is liable to pay the proper stamp duty and penalty.

(6) This section does not entitle a company to re-issue a redeemed debenture if the company has manifested the intention of the company that the debenture shall be cancelled or if re-issued, is forbidden by a provision in the constitution of the company or in the debenture, trust deed or any other contract entered into by the company.

(7) Where a company has deposited any of the debentures of the company to secure advances from time to time on current account or otherwise, the debentures shall not be deemed to have been redeemed by reason of the account of the company having ceased to be in debit while the debentures remained so deposited.

Part J: Transfer of Shares and Debentures
98. Restrictions on transferability of shares

(1) Except as expressly provided in the registered constitution of a company, shares arc transferable without restriction by a written transfer in common form.

(2) Subject to section 322, the registered constitution of a company may impose restrictions on the transferability of shares, including power for the directors to refuse to register a transfer and provisions for compulsory acquisition or rights of first refusal in favour of other members or officers of the company.

(3) A restriction shall not be imposed under subsection (2) on the transferability of any shares after the shares have been issued unless the holders of the shares consent in writing to the transfer.

(4) Despite subsection (1), a company may refuse to register a transfer of shares to a person who is an infant or to a person found by a court of competent jurisdiction in the Republic to be an infant or a person of unsound mind.

99. Register of debentures

(1) A company which issues or has issued debentures shall maintain a register of the holders of the debentures.

(2) Subject to sections 106 to 109,

 (a) the register of debenture holders shall be kept and maintained at the address at which the register of members is kept; and

 (b) sections 35 to 39 shall apply as regards the giving of notice to the Registrar of the place where the register is kept, taking into consideration the details in the register of debentures.

100. Restrictions on transferability of debentures

(1) Except as expressly provided in the terms of the debentures, debentures are transferable without restriction by a written transfer in common form and the transferee is entitled to the debenture and to the moneys secured by the transfer without regard to any equities, set-off, or cross claim between the company and the original or an intermediate holder.

(2) Subject to section 322, the terms of a debenture may impose restrictions on the transferability of debentures including power for the company to refuse to register a transfer and provisions for compulsory acquisition or rights of first refusal in favour of other debenture holders, or members or officers of the company.

(3) Where a restriction is imposed on the right to transfer a debenture, notice of the restriction shall be endorsed on the face of the debenture or debenture stock certificate and, in the absence of that endorsement, the restriction is ineffective as regards a transferee for value whether or not that transferee has notice of the restriction.

101. Registration of transfers

(1) Subject to sections 35, 102 and 103, a notice of a trust, express, implied or constructive or of any equitable, contingent, future or partial interest in a share or debenture or a fractional part of a share or debenture shall not be entered in the register of members or debenture holders or receivable by the company.

(2) For the purposes of subsection (1), the company is not bound by, or is not compelled in any way to recognise, any other rights in respect of a share or debenture except an absolute right to the entirety of the share or debenture in the registered holder; and accordingly until the name of the transferee is entered in the register in respect of the share or debenture, the transferor remains, so far as concerns the company, the holder of the share or debenture.

(3) Despite anything contained in the constitution of a company or in a contract, that company shall not register a transfer of shares or debentures unless a proper instrument of transfer duly stamped, if chargeable to stamp duty, has been delivered to the company.

(4) Subsection (3) does not derogate from a power of the company to register a person to whom the right to shares or debentures bas been transmitted by operation of law.

(5) Unless otherwise provided in the constitution of a company or the terms of the debenture, the company may refuse to register a transfer if the transfer is not accompanied by the appropriate share certificate, debenture or debenture stock certificate, or the company is bound to issue a renewal or copy of that certificate in accordance with subsection (2) of section 55 or section 85.

(6) Transfers may be lodged for registration by the transferor or the transferee.

(7) Where a company refuses to register a transfer, the company shall, within two months after the date on which the transfer was lodged with the company, send to the transferee and transferor notice of the refusal.

(8) Where a company defaults in complying with subsection (3) or (7), that company and every officer of the company that is in default is liable to pay to the Registrar an administrative penalty of five hundred penalty units.

(9) The provisions of this section shall not apply to a company the shares of which can be transferred through a scheme established under the Central Securities Depository Act, 2007 (Act 733).

102. Transmission of shares or debentures by operation of law

(1) In the case of the death of a shareholder or debenture holder,

 (a) the survivor or survivors, where the deceased was a joint holder, and

 (b) the legal personal representatives of the deceased, where the deceased was a sole holder or last survivor of joint holders, shall be the only persons recognised by the company as shareholders or debenture holders.

(2) A person on whom the ownership of a share or debenture devolves by reason of that person being the legal personal representative, receiver, or trustee in bankruptcy of the holder, or by operation of law may, on the evidence being produced that the company may properly require, be registered personally as the holder of the share or debenture or transfer the same to any other person, and the transfer shall be as valid as if that person had been registered as a holder at the time of execution of the transfer.

(3) The company has the right to decline registration of a transfer under subsection (2) as it would have had in the case of a transfer by the registered holder but does not have a right to refuse registration personally of that person.

(4) A person on whom the ownership of a share or debenture devolves by reason of that person being the legal personal representative, receiver, or trustee in bankruptcy of the holder, or by operation of law is entitled, before registration personally of that person or a transferee, to the same dividends, interest and other advantages as if that person were the registered holder and, in the case of a share, to the same rights and remedies as if that person were a member of the company, but that person is not entitled before being registered as a member in respect of the share, to attend and vote at a meeting of the company.

(5) For the purposes of subsection (4), the company may at any time give notice requiring that person to elect to be registered personally or to transfer the share or debenture, and if the notice is not complied with within ninety days, the company may suspend payment of the dividends, interest or any other moneys payable in respect of the share or debenture until the requirements of the notice have been complied with.

(6) The provisions of subsections (2) to (5) shall not apply to a company the shares of which can be transferred through a scheme established under the Central Securities Depository Act, 2007 (Act 733).

103. Protection of beneficiaries

(1) A person claiming to be interested in any shares or debentures or the dividends or interest on those shares or debentures may protect the interest of that person by serving on the company concerned copies of a notice and affidavit in accordance with the High Court (Civil Procedure) Rules, 2004 (C.l. 47).

(2) Despite subsection (I) of section I 0 I, the company shall

 (a) enter on the register of members or debenture holders, the fact that the notice has been served, and

 (b) not register a transfer or make a payment or return in respect of the shares or debentures contrary to the terms of the notice until the expiration of due notice to the claimant in accordance with that Order.

(3) In the event of a default by the company in complying with this section, the company shall compensate a person injured as a result of the default.

(4) The provisions of this section shall not apply to a company the shares of which are dealt with by virtue of a scheme established under the Central Securities Depository Act, 2007 (Act 733).

104. Certification of transfers

(1) Where the holder of shares or of debenture stock wishes to transfer to a person part only of the shares or stock represented by one or more certificates, the instrument of transfer together with the related certificates may be delivered to the company or to the registration officer of the company with a request to certify the instrument of transfer.

(2) If a company or its registration officer endorses on an instrument of transfer the words "certificate lodged", or words to the like effect, the endorsement shall be taken as a representation to anyone acting on the faith of the certification that there has been produced to, and retained by, the company or the registration officer the certificates that show a prima facie title to the shares or stock in the transferor named in the instrument of transfer but not as a representation that the certificates arc genuine or that the transferor has a title to the shares or stock.

(3) Where a person acts on the faith of a false certification made by the company, the company is liable to compensate that person for a loss suffered as a result of so acting

(4) Where a person acts on the faith of a false certification made by the registration officer, the company and the registration officer are jointly and severally liable to compensate that person for a loss suffered as a result of so acting but the company is entitled to be indemnified by the registration officer.

(5) The certification is made by the company,

 (a) if the certification bears the signature or initials, whether handwritten or not, of an officer for whose act of signing that certificate the company is liable under sections 14 7 to 151; or

 (b) if the certification purports to bear the signature or initials, whether hand-written or not, of an officer of the company and is issued by an officer of the company for whose act of issuing the certificate the company is liable under sections 147 to 151.

(6) The certification is made by the registration officer,

 (a) if the certification bears the signature or initials, whether handwritten or not, of the registration officer or of any officer, agent or servant of the registration officer having the authority to certify transfers of the shares or debenture stock of the company; or

 (b) if the certification purports to bear the signature or initials, whether handwritten or not, of the registration officer or any officer, agent or servant of the registration officer and when issued by the registration officer or any officer, agent or servant of the registration officer having the authority to issue certification of transfers of the shares or debenture stock of the company.

(7) For the purposes of subsections (5) and (6), the certification is issued by a person, if the instrument of transfer bearing the certification is delivered or sent by that person to the transferor, transferee or any other person named in the request for certification, or is despatched to the transferor, transferee or that other person with a covering letter bearing the signature or initials of that person whether handwritten or not.

(8) The provisions of this section shall not apply to a company the shares of which are operated by virtue of a scheme established under the Central Securities Depository Act, 2007 (Act 733).

105. Lien of a company on shares

(1) Subject to the Central Securities Depository Act, 2007 (Act 733), a company may, where the constitution of the company so provides, have a lien on any of the issued shares on which there is an unpaid liability for the moneys, whether presently payable or not, called or payable at a fixed time in respect of those shares.

(2) The lien shall be an effective charge on the shares and the dividends payable on the shares enforceable in the manner provided by the constitution of the company.

(3) Despite a provision in the constitution of the company, the lien of the company shall not extend to shares on which there does not exist an unpaid liability, or to the sums of money due from the shareholder except in respect of the unpaid liability on the shares.

 

Part K Branch Registers
106. Power of company co keep branch register

(1) A company that has shares may, if so required by the constitution of the company, keep in a country outside the Republic a branch register of shareholders or debenture holders or beneficial owners residing in that country or in any other country outside the Republic.

(2) The company shall give to the Registrar, notice of the location of the office where a branch register is kept, and of a change in the location of the company, and if it is discontinued, of the discontinuance.

(3) The notice shall be given within twenty-eight days of the opening of the office or of the change or discontinuance.

(4) Where the company defaults in complying with subsections (2) and (3), the company and every officer of the company who is in default is liable to pay to the Registrar, an administrative penalty of twenty-five penalty units for each day during which the default continues.

107. Regulations as to branch registers

(1) A branch register is a part of the principal register of members, debenture holders or beneficial owners of the company.

(2) A branch register shall be kept in, and shall be opened for inspection in, the same manner in which the principal register is, by sections 35 to 39 and sections 99 to 101 required to be kept, and the advertisement before closing the branch register shall be published in a daily newspaper circulating in the district where the branch register is kept.

(3) The company shall,

 (a) transmit to the registration office of the company a copy of every entry in the branch register as soon as practicable after the entry is made; and

 (b) keep at the place where the principal register of the company is kept, a duplicate of the branch register duly entered up from time to time.

(4) The duplicate is, for the purposes of this Act, a part of the principal register.

(5) Subject to this section, with respect to the duplicate register, the shares or debentures registered in a branch register shall be distinguished from those registered in the principal register, and a transaction with respect to a share or debenture registered in a branch register shall not, during the continuance of that registration, be registered in any other register.

(6) A company may discontinue a branch register, and the entries in that register shall be transferred to the principal register.

(7) Subject to this Act, a company may, by the constitution of the company, make provisions respecting the keeping of branch registers.

(8) Where a company defaults in complying with subsection (3), the company and every officer of the company who is in default is liable to pay to the Registrar an administrative penalty of twenty-five penalty units for each day during which the default continues.

(9) Where the principal register is kept at the office of a person other than the company, and by reason of a default of that person the company fails to comply with paragraph {b) of subsection (3), that person is liable to the same penalty as if that person was an officer of the company who was in default.

(10) The provisions of this section shall not apply to a company the shares of which are operated by virtue of a scheme established under the Central Securities Depository Act, 2007 (Act 733).

108. Stamp duties in case of securities registered in branch registers

An instrument of transfer of a share or debenture registered in a branch register, is a transfer of property situate out of the Republic, and, unless executed in a part of the Republic, shall be exempted from a stamp duty chargeable in the Republic.

109. Provisions as to branch registers kept in the Republic

(1) Subject to subsection (2), where the law in force in a country provides for companies incorporated under that Jaw to keep in Ghana branch registers of their shareholders or debenture holders, the Minister may, by legislative instrument, make Regulations for the application of sections 36 and 38 in relation to those branch registers.

(2) The application of sections 35, 36 and 38 shall not derogate from any modification and adaptation specified in the legislative instrument made under subsection (1).

Part L: Registration of Particulars of Charges
110. Registration of particulars of charges created by companies

(1) A charge, other than a charge specified in subsection (5), created by a company after the commencement of this Act is void so far as a security on the property of the company, is conferred by that charge, unless the particulars prescribed in this section together with the original or a certified copy of the instrument by which the charge is created or evidenced, are delivered in the prescribed form to the Registrar for registration within forty-five days after the date of the creation of the charge.

(2) For the purposes of subsection (1), "property" includes the undertaking of the company and the unpaid liability on the shares of the company.

(3) This section shall not affect a contract or an obligation for repayment of the money secured by the contract or obligation.

(4) When a charge becomes void under this section, the money secured by the charge shall immediately become payable despite a provision to the contrary in the contract.

(5) This section shall not apply to a pledge of, or possessory lien on, goods, or to a charge, by way of pledge, deposit, letter of hypothecation or trust receipt, of bills of lading, dock warrants or any other documents of title to goods, or of bills of exchange, promissory notes or any other negotiable securities for money.

(6) Subject to subsections (7) and (8), the particulars requiring delivery for registration under this section are

(a) the date of creation of the charge;

 (b) the nature of the charge;

 (c) the amount of money secured by the charge, or the maximum sum of money secured by the charge in accordance with section 111;

 (d) short particulars of the property charged;

 (e) the persons entitled to the charge;

 (f) in the case of a floating charge, the nature of a restriction on the power of the company to grant further charges ranking in priority to, or at the same rate with, the charge created by the registration; and

 (g) particulars of any variation of the terms and provisions of a charge.

(7) Where a series of debentures containing, or giving by reference to any other instrument, a charge to the benefit of which the debenture holders are entitled at the same rate, is created by the company, it shall, for the purposes of this section, be sufficient if the debentures are delivered to the Registrar within forty-five days after the execution of the document containing the charge or, if there is no document containing the charge after the execution of any debentures of the series, the following particulars, namely,

(a) the dates of the resolutions authorising the issue of the series and the date of the covering deed by which the security is created or defined,

 (b) the total amount of money secured by the whole series,

 (c) the names of the trustees, and

 (d) the particulars specified in paragraphs (b), (d) and(!) of sub section (6) of this section, together with the original or certified copy of the deed creating the charge or, of any deed variation of the terms and provisions of the charge or if there is no certified copy of the deed, the debentures of the series.

(8) For the purposes of subsections (l) and (7), a certified copy is a copy which has, endorsed on that copy, a certificate to the effect that it is a true and complete copy of the original, under the seal of the company or signed personally by a person interested in the copy otherwise than on behalf of the company.

(9) Where the original is not in the English language, the copy shall also contain a translation acceptable to the Registrar similarly certified to the effect that it is an accurate translation of the original.

(10) This section does not affect the provisions of any other enactment relating to the registration of charges.

111. Charges to secure fluctuating amounts

(1) Where a charge, particulars of which require registration under section 110 is expressed to secure

 (a) the sums of money due or to become due, or

 (b) some other uncertain or fluctuating amount, the particulars required under paragraph (c) of subsection (6) of section 110 shall state the maximum sum of money secured by the charge, being charge and the charge shall be void, so far as a security on the property of the company is conferred by the registration, regarding an excess over the stated maximum.

(2) For the purposes of subsection (1), if

 (a) additional stamp duty is subsequently paid on the charge, and

 (b) at any time after the payment, but before the commencement of the winding up of the company, particulars of the charge stating the increased maximum sum of money secured by the charge, together with the original instrument by which the charge was created or evidenced, arc delivered to the Registrar for registration, as from the date of the delivery, the charge, if otherwise valid, shall be effective to the extent of the increased maximum sum of money except as regards a person who, before the date of the delivery, has acquired any proprietary rights in, or a fixed or floating charge on, the property subject to the charge.

112. Charges on property acquired

(1) When a company acquires a property which is subject to a charge of the kind that particulars of it would, if it had been created by the company after the acquisition of the property, have been required to be registered under section J I 0, the company shall deliver to the Registrar for registration particulars of the charge together with the document by which the charge was created or evidenced or a copy of that document, certified as provided in subsections (8) and (9) of section 110.

(2) The delivery under subsection (1) shall be effected within twenty-eight days after the date on which the acquisition is completed.

(3) The particulars requiring registration under subsection (l) shall be those specified in subsection (6) of section 110 with the addition of the date of the acquisition of the property by the company.

(4) Failure to comply with this section shall not affect the validity of the charge.

113. Existing charges

(1) Where, at the date of commencement of this Act, a company has property on which there is a charge, particulars of which would require registration, if it had been created by the company after the date of that commencement then, unless the charge has been discharged or the property has ceased to be held by the company before the expiration of six months from the date of that commencement, the company shall, within that time, deliver particulars of the charge as prescribed by section 110 to the Registrar for registration together with the document, by which the charge was created or a copy of that document certified as required by that section.

(2) An existing company shall before the expiration of six months from the commencement of this Act, deliver to the Registrar for registration a statutory declaration made by a director and the Company Secretary stating whether or not there are any charges on the property of the company of which particulars require to be registered under subsection (1) and confirming that particulars of those charges have been duly delivered to the Registrar for registration.

(3) Failure to comply with this section shall not affect the validity of the charge.

114. Duty of company to deliver particulars for registration

(1) A company shall send to the Registrar for registration the particulars required to be sent under sections 110 to 113, but registration of the particulars of the charge may be effected on the application of a person interested in the charge.

(2) Where registration is effected on the application of a person other than the company, that person is entitled to recover from the company the amount of the fees payable to the Registrar on the registration.

(3) Where a company defaults in sending to the Registrar the particulars requiring registration as required by this section, the company and every officer of the company that is in default is liable to pay to the Registrar, an administrative penalty of five hundred penalty units unless the particulars have been duly delivered for registration by any other person.

115. Register of particulars of charges

(1) The Registrar shall keep, with respect to each company, a register of the particulars duly delivered pursuant to sections 110 to 113 and shall enter the particulars in the register.

(2) The Registrar shall give a certificate signed by the Registrar of the registration of particulars of a charge registered in pursuance of sections 110 to 113, and the certificate is conclusive evidence, except in favour of the company or of any other person who has delivered false or incomplete particulars or an incorrect copy of a document, that the requirements of sections 110 to 113 have been complied with.

(3) In the case of a charge of the type referred to in section 111, the certificate shall state the maximum sum of money deemed to be secured by the charge.

(4) The original or certified copy of the instrument of the charge delivered with the particulars shall not be registered or retained by the Registrar.

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