- Section 433 of The Companies Act No. 17 of 2015: Application of sections 437 to 442 to private company that applies for registration of conversion into public company
(1) This section applies to a private company that is registered as a public company—
after shares in the company have been forfeited in accordance with the company's articles or have been surrendered to the company instead of forfeiture;
(b) after shares in which the company had a beneficial...
- Section 434 of The Companies Act No. 17 of 2015: Transfer to reserve on acquisition of shares by public company ornominee
(1) If—
(a) a public company, or a nominee of a public company, acquires shares in the company; and
(b) those shares are shown in a balance sheet of the company as an asset,
the company shall transfer to a reserve account from profits available for the
payment of dividends an amount equal to the...
- Section 435 of The Companies Act No. 17 of 2015: Public companies: general rule against lien or charges on own shares
(1) A lien or other charge of a public company on its own shares(whether taken expressly or otherwise) is void, except as permitted by this section.(
2) In the case of any description of company, a charge is permitted if the shares are not fully paid up and the charge is for an amount payable in...
- Section 436 of The Companies Act No. 17 of 2015: Interests to be disregarded in determining whether company has beneficial interest
In determining for the purposes of this Part whether a company has a beneficial interest in shares, the interests referred to in sections 437, 438 and 439 are to be disregarded.
- Section 437 of The Companies Act No. 17 of 2015: Residual interest under pension scheme or employees’ share scheme
(1) When the shares are held in trust for the purposes of a pension scheme or an employees’ share scheme, any residual interest of the company that has not vested in possession is to be disregarded.
(2) For the purpose of subsection (1), “residual interest” means a right of the company to receive...
- Section 438 of The Companies Act No. 17 of 2015: Employer’s charges and other rights of recovery
(1) If the relevant shares are held on trust for the purposes of a pension scheme, the following are to be disregarded—
(a) a charge or lien on, or set-off against, any benefit or other right or interest under the scheme for the purpose of enabling the employer or former employer of a member of the...
- Section 439 of The Companies Act No. 17 of 2015: Rights as executor, administrator or trustee
(1) If the company is an executor, administrator or trustee, rights that thecompany has in that capacity are to be disregarded.
(2) Those rights include—
(a) a right of the company to recover its expenses or be remunerated out of the estate or trust property; and
(b) a right of the company to be...
- Section 440 of The Companies Act No. 17 of 2015: Meaning of “financial assistance” for purposes of this Part
(1) In this Division, “financial assistance” means—(a) financial assistance given in the form of a gift; (b) financial assistance given—
(i) in the form of a guarantee, security or indemnity other than an indemnity in respect of the indemnifier's own neglect or default; or
(ii) in the form of a...
- Section 442 of The Companies Act No. 17 of 2015: Assistance for acquisition of shares in public company
(1) If a person is acquiring or proposing to acquire shares in a public company, neither the company nor any other company that is a subsidiary of the company may give financial assistance (directly or indirectly) for the purpose of the acquisition before or at the same time as the acquisition takes...
- Section 443 of The Companies Act No. 17 of 2015: Assistance by public company for acquisition of shares in its private holding company
(1) If a person is acquiring or proposing to acquire shares in a private company, a public company that is a subsidiary of that company shall not give financial assistance (directly or indirectly) for the purpose of the acquisition before or at the same time as the acquisition takes...
- Section 444 of The Companies Act No. 17 of 2015: Offence to give prohibited assistance
(1) If a company contravenes section 442(1) or (3) or 443 (1) or (3), thecompany, and each officer of the company who is in default, commit an offence.
(2) A company that is found guilty of an offence under subsection (1) is liableon conviction to a fine not exceeding one million shillings.
(3) An...
- Section 445 of The Companies Act No. 17 of 2015: Certain transactions excepted unconditionally from sections 442 and 443
Sections 442 and 443 do not prohibit any of the following transactions— (a) a distribution of a company’s assets in the form of—(i) a dividend lawfully made; or
(ii) a distribution in the course of a company's liquidation;
(b) an allotment of bonus shares;
(c) a reduction of capital;
(d) a...
- Section 446 of The Companies Act No. 17 of 2015: Certain transactions excepted from sections 442 and 443 conditionally
(1) This section applies to the following transactions—
(a) if the lending of money is part of the ordinary business of the company —the lending of money in the ordinary course of the company’s business;
(b) the provision by the company — in good faith in the interests of the company or its...
- Section 447 of The Companies Act No. 17 of 2015: Power of limited company to purchase own shares
(1) A limited company having a share capital may purchase its own shares
(including any redeemable shares), subject to— (a) the following provisions of this Division; and
(b) any restriction or prohibition in the company's articles.
(2) A limited company may not purchase its own shares if as a...
- Section 448 of The Companies Act No. 17 of 2015: Purchase of company’s own shares
(1) A limited company may not purchase its own shares unless they are fullypaid.
(2) A limited company that purchases its own shares shall pay for them on purchase.
(3) A purchase in contravention of this section is void.
- Section 449 of The Companies Act No. 17 of 2015: Financing of purchase of company's own shares
(1) A private limited company may purchase its own shares out of capital in accordance with Division 4.
(2) Subject to subsection (1)—
(a) a limited company may purchase its own shares only out of—
(i) distributable profits of the company; or
(ii) the proceeds of a fresh issue of shares made for...
- Section 450 of The Companies Act No. 17 of 2015: Approval for company to purchase own shares
(1) A limited company may purchase its own shares only—
(a) by an off-market purchase, under a contract approved in advance in accordance with section 451; or
(b) by a market purchase, approved in accordance with section 458.
(2) A purchase is off-market if the shares either—
(a) are purchased...
- Section 451 of The Companies Act No. 17 of 2015: Authorisation for off-market purchase
(1) A company may make an off–market purchase of its own shares under acontract but only if—
(a) the terms of the contract have been approved by a special resolution of the company before the contract was entered into; or
(b) the contract provides that no shares may be purchased under the contract...
- Section 452 of The Companies Act No. 17 of 2015: Resolution authorising off-market purchase: exercise of voting rights
(1) This section applies to a resolution to confer, vary, revoke or renew an approval for the purposes of section 451.
(2) If the resolution is proposed as a written resolution, a member who holds shares to which the resolution relates is not an eligible member.
(3) A resolution proposed at a...
- Section 453 of The Companies Act No. 17 of 2015: Resolution approving off-market purchase: disclosure of details of contract
(1) This section applies to a resolution passed by a company to confer, vary, revoke or renew an approval to make a purchase under section 451.
(2) The company shall ensure that a copy of the relevant contract (if it is inwriting) or a memorandum setting out its terms (if it is not in writing) is...
- Section 454 of The Companies Act No. 17 of 2015: Variation of contract for off-market purchase
(1) A company may agree to a variation of a contract approved under section451 only if the variation is approved in advance in accordance with this section.
(2) The terms of the variation have effect only if they have been approved bya special resolution of the company.
(3) The approval may be...
- Section 455 of The Companies Act No. 17 of 2015: Resolution approving variation: exercise of voting rights
(1) This section applies to a resolution passed by a company to confer, vary, revoke or renew an approval to vary a contract under section 454.
(2) If the resolution is proposed as a written resolution, a member who holds shares to which the resolution relates is not an eligible member.
(3) A...
- Section 456 of The Companies Act No. 17 of 2015: Resolution approving variation: disclosure of details of variation
(1) This section applies to a resolution passed by a company under section 454.
(2) The company shall ensure that a copy of the proposed variation (if it is inwriting) or a written memorandum giving details of the proposed variation (if it is not) is made available to the members of the...
- Section 457 of The Companies Act No. 17 of 2015: Release of company’s rights under contract for off-market purchase
(1) An agreement by a company to release its rights under a contract approvedunder section 451 is void unless the terms of the release agreement are approved in advance in accordance with this section.
(2) The terms of the proposed agreement have effect only if they are approvedby a special...
- Section 458 of The Companies Act No. 17 of 2015: Approval for company to make market purchase
(1) A company may make a market purchase of its own shares only if the purchase has been approved by a resolution of the company.
(2) Such an approval—
(a) can be general or limited to the purchase of shares of a particular class or description; and
(b) can be unconditional or made subject to...
- Section 459 of The Companies Act No. 17 of 2015: Copy of contract or memorandum to be available for inspection
(1) This section applies to a company that has entered into—
(a) a contract approved under section 451; or
(b) a contract for a purchase approved under section 458.
(2) The company shall keep available for inspection—
(a) a copy of the contract; or
(b) if the contract is not in writing, a...
- Section 460 of The Companies Act No. 17 of 2015: Enforcement of right to inspect copy or memorandum
(1) If a company fails to comply with a requirement of section 459, the company, and each officer of the company who is in default, commit an offence and on conviction are each liable to a fine not exceeding two hundred thousand shillings.
(2) If, after a company or any of its officers is convicted...
- Section 461 of The Companies Act No. 17 of 2015: Company’s right to purchase own shares not assignable
The rights of a company under a contract authorised under section 451 or 458 are not capable of being assigned.
- Section 462 of The Companies Act No. 17 of 2015: Payments apart from purchase price to be made out of distributable profits
(1) A payment made by a company in consideration of—
(a) acquiring any right with respect to the purchase of its own shares under a contingent purchase contract approved under section 451;
(b) the variation of any contract approved under that section; or
(c) the release of any of the company's...
- Section 463 of The Companies Act No. 17 of 2015: How shares purchased are to be treated
If a limited company makes a purchase of its own shares in accordance with this Division, then—
(a) if section 458 applies, the shares are to be held and dealt with in accordance with Part XXI, but;
(b) if that section does not apply— (i) the shares are cancelled; and
(ii) the amount of the...