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Bahamas IBC Act -309

Bahamas Formations India Companies Act 1956 previous companies act next companies act

PART III - CAPITAL AND DIVIDENDS

20.Subject to any limitations in the Memorandum or Articles, each share in a company shall be issued for money, services rendered, personal property (including other shares, debt obligations or other securities in the company), an estate in real property, a promissory note or other binding obligation to contribute money or property, or any combination thereof.

Consideration for shares.

21.(1) Subject to any limitations in the Memorandum or Articles, shares in a company may be issued for such amount as may be determined from time to time by the directors, and, in the absence of fraud, the decision of the directors as to the value of the consideration received by the company in respect of the issue is conclusive, unless a question of law is involved.

Amount of consideration.

(2) Subject to any limitations in the Memorandum or Articles, treasury shares and unissued shares may be disposed of by a company on such terms and conditions as the directors may determine.

22.Subject to any limitations in its Memorandum or Articles, a company may issue fractions of a share and unless and to the extent otherwise provided in the Memorandum or Articles, a fractional share has the corresponding fractional liabilities, limitations, preferences, privileges, qualifications, restrictions, rights and other attributes of a share of the same class or series of shares.

Fractional shares.

23.(1) Where a company issues a share with par value, the consideration in respect of the share constitutes capital to the extent of the par value and the excess constitutes surplus.

Capital and surplus accounts.

(2) Subject to any limitations in the Memorandum or Articles, where a company incorporated under this Act issues a share without par value, the consideration in respect of the share constitutes capital to the extent designated by the directors and the excess constitutes surplus, except that the directors shall designate as capital an amount of the consideration that shall be at least equal to the amount that the share is entitled to as a preference, if any, in the assets of the company upon liquidation of the company.

(3) Upon the disposition by a company of a treasury share, the consideration in respect of the share shall be added to surplus.

24.(1) A share issued as a dividend by a company shall be treated for all purposes as having been issued for money equal to the surplus that has been transferred to capital upon the issue of the share.

Dividend of shares.

(2) In the case of a dividend of authorised but unissued shares with par value, an amount equal to the aggregate par value of the shares shall be transferred from surplus to capital at the time of the distribution.

(3) In the case of a dividend of authorised but unissued shares without par value, the amount designated by the directors shall be transferred from surplus to capital at the time of the distribution, except that the directors shall designate as capital an amount that is at least equal to the amount that the shares are entitled to as preference, if any, in the assets of the company upon liquidation of the company.

(4) A division of the issued and outstanding shares of a class or series of shares into a larger number of shares of the same class or series having proportionately small par value does not constitute a dividend of shares.

25.(1) Subject to any limitations in its Memorandum or Articles, a company may, by a resolution of directors,amend its Memorandum to increase or reduce its authorised capital and in connection therewith, the company may-

Increase or reduction of capital.

(a) increase or reduce the number of shares which the company may issue;

(b) increase or reduce the par value of any of its shares; or

(c) effect any combination under paragraphs (a) and (b) .

(2) Where a company reduces its authorised capital under subsection (1) , then, for the purposes of computing capital of the company, any capital that immediately before the reduction was represented by shares but immediately following the reduction is no longer represented by shares shall be deemed to be surplus transferred from capital to surplus.

26.(1) A company may amend its Memorandum-

Division and combination.

(a) to divide the shares, including issued shares, of a class or series into a larger number of shares of the same class or series; or

(b) to combine the shares, including issued shares of a class or series into a smaller number of shares of the same class or series.

(2) Where shares are divided or combined under subsection (1) , the aggregate par value of the new shares shall be equal to the aggregate par value of the original shares.

27.Shares of a company are personal property and are not of the nature of real property.

Nature of share.

28.(1) A company shall state in its Articles whether or not certificates in respect of its shares shall be issued.

Share certificates.

(2) Where a company issues certificates in respect of its shares, the certificates-

(a) shall be signed by two directors or two officers of the company, or by one director and one officer; or

(b) shall be under the common seal of the company evidenced by the signature of a director or officer of the company,

and the Articles may provide for the signatures or common seal to be stamped thereon.

(3) A certificate issued in accordance with subsection (2) specifying a share held by a member of the company shall be prima facie evidence of the title of the member to the share specified therein.

29.(1) A company shall cause to be kept at its registered office one or more registers to be known as Share Registers containing-

Share Register.

(a) the names and addresses of the persons who hold registered shares in the company;

(b) the number of each class and series of registered shares held by each person;

(c) the date on which the name of each person was entered in the Share Register; and

(d) the date on which any person ceased to be a member.

(2) The Share Register may be in such form as the directors may approve but if it is magnetic, electronic or other data storage form, the company shall be able to produce legible evidence of its contents.

(3) The Share Register shall be prima facie evidence of any matters directed or authorised by this Act to be contained therein.

(4) In the case of a company limited by guarantee the term "Share Register" shall mean "Register of Members" in which shall be entered the names and addresses of the members of such a company, the date of such entry and the date when any person ceases to be a member.

30.(1) If-

Rectification of Share Register.

(a) information that is required to be entered in the Share Register under section 29 is omitted therefrom or inaccurately entered therein; or

(b) there is unreasonable delay in entering the information in the Share Register,

a member of the company, or any person who is aggrieved by the omission, inaccuracy or delay may apply to the court for an order that the Share Register be rectified, and the court may either grant or refuse the application, with or without costs to be paid by the applicant, or order the rectification of the Share Register and may direct the company to pay all costs of the application and any damages the applicant may have sustained.

(2) The court may, in any proceedings under subsection (1) , determine any question relating to the right of a person who is a party to the proceedings to have his name entered in or omitted from the Share Register, whether the question arises between-

(a) two or more members or alleged members; or

(b) between members or alleged members and the company,

and generally the court may in the proceedings determine any question that may be necessary or expedient to be determined for the rectification of the Share Register.

31.(1) Subject to any limitations in the Memorandum or Articles, registered shares of a company incorporated under this Act may be transferred by a written instrument of transfer signed by the transferor and containing the name and address of the transferee.

Transfer of registered shares.

(2) In the absence of a written instrument of transfer mentioned in subsection (1) , the directors may accept such evidence of a transfer of shares as they consider appropriate.

(3) A company shall not be required to treat a transferee of a registered share in the company as a member until the transferee's name has been entered in the Share Register.

(4) Subject to any limitations in its Memorandum or Articles, a company shall, on the application of the transferor or transferee of a registered share in the company, enter in its Share Register the name of the transferee of the share.

(5) A transfer of registered shares of a deceased, or bankrupt member of a company made by his personal representative, guardian or trustee, as the case may be, or a transfer of registered shares owned by a person as a result of a transfer from a member by operation of law, is of the same validity as if the personal representative, guardian, trustee or transferee had been the registered holder of the shares at the time of the execution of the instrument of transfer.

32.(1) Subject to any limitations in its Memorandum or Articles, a company may purchase, redeem or otherwise acquire and hold its own shares.(2) No purchase, redemption or other acquisition permitted under subsection (1) shall be made unless the directors determine that immediately after the purchase, redemption or other acquisition-

Acquisition of shares.

(a) the company will be able to satisfy its liabilities as they become due in the ordinary course of its business; and

(b) the realizable value of the assets of the company will not be less than the sum of its total liabilities, other than deferred taxes, as shown in the books of account;

and, in the absence of fraud, the decision of the directors as to the realizable value of the assets of the company is conclusive unless a question of law is involved.

(3) A determination by the directors under subsection (2) is not required where shares are purchased, redeemed or otherwise acquired-

(a) pursuant to a right of a member to have his shares redeemed or to have his shares exchanged for money or other property of the company;

(b) in exchange for newly issued shares in the company;

(c) by virtue of the provisions of section 81; and

(d) pursuant to an order of the court.

(4) Subject to any limitations in the Memorandum or Articles, shares that a company purchases, redeems or otherwise acquires may be cancelled or held as treasury shares unless the shares are purchased, redeemed or otherwise acquired out of capital pursuant to section 34, in which case they shall be cancelled; and upon the cancellation of a share, the amount included as capital of the company with respect to that share shall be deducted from the capital of the company.

33.Where shares in a company-

Treasury shares disabled in respect of voting and dividends.

(a) are held by the company as treasury shares; or

(b) are held by another company of which the first company holds, directly or indirectly, shares having more than 50 per cent of the votes in the election of directors of another company, the shareholders of the first company are not entitled to vote or to have dividends paid thereon and shall not be treated as outstanding for any purpose under this Act except for the purpose of determining the capital of the first company.

34.(1) Subject to any limitations in the Memorandum or Articles and subject to subsections (3) and (4) , the capital of a company incorporated under this Act may by resolution of directors, be-

Increase or reduction of capital.

(a) increased by transferring an amount out of the surplus of the company to capital; or

(b) reduced by-

(i) returning to members any amount received by the company upon the issue of any of its shares, the amount being surplus to the company;

(ii) cancelling any capital that is lost or not represented by assets having a realizable value; or

(iii) transferring capital to surplus for the purpose of purchasing, redeeming or otherwise acquiring shares that the directors have resolved to purchase, redeem or otherwise acquire.

(2) Where a company reduces its capital under subsection (1) , the company may-

(a) return to members any amount received by the company upon the issue of its shares;

(b) purchase, redeem or otherwise acquire its shares out of capital; or

(c) cancel any capital that is lost or not represented by assets having a realizable value.

(3) No reduction of capital shall be effected that reduces the capital of the company to an amount that is less than the sum of-

(a) the aggregate of-

(i) all outstanding shares with par value; and

(ii) all shares with par value held by the company as treasury shares; and

(b) the aggregate of the amounts designated as capital of-

(i) all outstanding shares without par value; and

(ii) all shares without par value held by the company as treasury shares that are entitled to a preference, if any, in the assets of the company upon liquidation of the company.

(4) No reduction of capital shall be effected under subsection (1) unless the directors determine that immediately after the reduction-

(a) the company will be able to satisfy its liabilities as they become due in the ordinary course of its business; and

(b) the realizable value of the assets of the company will not be less than its total liabilities, other than deferred taxes, as shown in the books of account, and its remaining issued and outstanding share capital, and, in the absence of fraud, the decision of the directors as to the realizable value of the assets of the company is conclusive unless a question of law is involved.

35.(1) Subject to any limitations in its Memorandum or Articles a company incorporated under this Act may, by a resolution of directors, declare and pay dividends in money, shares or other property.

Dividends.

(2) Dividends shall only be declared and paid if the directors determine that immediately after the payment of the dividend-

(a) the company will be able to satisfy its liabilities as they become due in the ordinary course of its business; and

(b) the realizable value of the assets of the company will not be less than the sum of its total liabilities, other than deferred taxes, as shown in the books of account, and its issued and outstanding share capital, and, in the absence of fraud, the decision of the directors as to the realizable value of the assets of the company is conclusive unless a question of law is involved.

36.Subject to any limitations in its Memorandum or Articles a company incorporated under this Act may, by a resolution of directors, include in the computation of surplus for any purpose under this Act the net unrealised appreciation of assets of the company, and in the absence of fraud, the decision as to the value of the assets is conclusive, unless a question of law is involved.

Appreciation of assets.

PART IV - REGISTERED OFFICE AND REGISTERED AGENT

37.(1) A company shall at all times have a registered office in The Bahamas.

Registered office.

(2) The address of the registered office shall be submitted to the Registrar with the Memorandum for registration upon the date of the application for incorporation.

(3) The directors of the company may change the address of the registered office of the company, which change shall be notified to the Registrar within seven days after such change has been made.

38.(1) A company shall at all times have a registered agent in The Bahamas.

Registered agent.

(2) No person shall act as registered agent unless he is licensed to carry on the business of financial and corporate services pursuant to section 3 of the Financial and Corporate Service Providers Act, 2000:

Provided that this subsection shall not apply to a company licensed under the Banks and Trust Companies Regulation Act.

(3) The Minister may by order vary or add to the requirements of subsection (2) .

(4) Any person who was acting as a registered agent before the coming into force of this section may continue to so act but only if such person within 90 days from the commencement of this section obtains a licence pursuant to the Financial and Corporate Service Providers Act, 2000.

(5) The name and address of the registered agent shall be submitted to the Registrar for registration at the date of incorporation of the company.

(6) The company shall notify the Registrar of any change in the name or address of the registered agent.

39.(1) The Registrar shall maintain a register of licensed registered agents and the register referred to in section 9 of the Financial and Corporate Service Providers Act, 2000 shall be the register for the purposes of this section.

Register of registered agents.

(2) The Registrar shall, during the month of February in each year, publish in the Gazette a list of registered agents on 31st January in that year.

(3) Any change in the details kept by the Registrar in the register of registered agents pursuant to subsection (1) shall be notified immediately by the registered agent to the Registrar, and upon payment of such fee as may be prescribed by the Minister, the Registrar shall record the change in the register of registered agents.