Companies (Amendment) Act, 1983
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Pre-emption rights. |
23.—(1) Subject to the following provisions of this section and sections 24 and 25 , a company proposing to allot any equity securities— | |
(a) shall not allot any of those securities on any terms to any person unless it has made an offer to each person who holds relevant shares or relevant employee shares to allot to him on the same or more favourable terms a proportion of those securities which is as nearly as practicable equal to the proportion in nominal value held by him of the aggregate of relevant shares and relevant employee shares; and | ||
(b) shall not allot any of those securities to any person unless the period during which any such offer may be accepted has expired or the company has received notice of the acceptance or refusal of every offer so made. | ||
(2) Subsection (3) applies to any provision of the memorandum or articles of a company which requires the company, when proposing to allot equity securities consisting of relevant shares of any particular class, not to allot those securities on any terms unless it has complied with the condition that it makes such an offer as is described in subsection (1) to each person who holds relevant shares or relevant employee shares of that class. | ||
(3) If, in accordance with a provision to which this subsection applies— | ||
(a) a company makes an offer to allot any securities to such a holder; and | ||
(b) he or anyone in whose favour he has renounced his right to their allotment accepts the offer, | ||
subsection (1) shall not apply to the allotment of those securities and the company may allot them accordingly; but this subsection is without prejudice to the application of subsection (1) in any other case. | ||
(4) Subsection (1) shall not apply in relation to a particular allotment of equity securities if the securities are, or are to be, wholly or partly paid up otherwise than in cash. | ||
(5) Securities which a company has offered to allot to a holder of relevant shares or relevant employee shares may be allotted to him or anyone in whose favour he has renounced his right to their allotment without contravening subsection (1) (b). | ||
(6) Subsection (1) shall not apply in relation to the allotment of any securities which would apart from a renunciation or assignment of the right to their allotment be held under an employees' share scheme. | ||
(7) An offer which is required by subsection (1) or by any provision to which subsection (3) applies to be made to any person shall be made by serving it on him in the manner in which notices are authorised to be given by regulations 133, 134 and 135 of Table A; but where he is the holder of a share warrant the offer may instead be made by causing the offer, or a notice specifying where a copy of the offer can be obtained or inspected, to be published in Iris Oifigiúil. | ||
(8) Any such offer as is mentioned in subsection (7) must state a period of not less than 21 days during which the offer may be accepted; and the offer shall not be withdrawn before the end of that period. | ||
(9) Subsections (7) and (8) shall not invalidate a provision to which subsection (3) applies by reason that that provision requires or author-ises an offer thereunder to be made in contravention of one or both of those subsections, but, to the extent that the provision requires or authorises such an offer to be so made, it shall be of no effect. | ||
(10) Subsection (1), (7) or (8) may, in its application in relation to allotments by a private company of equity securities or to such allotments of a particular description, be excluded by a provision contained in the memorandum or articles of that company; and a requirement or authority contained in the memorandum or articles of a private company shall, if it is inconsistent with any of those subsections, have effect as a provision excluding that subsection, but a provision to which subsection (3) applies shall not be treated as being inconsistent with subsection (1). | ||
(11) Where there is a contravention of subsections (1), (7) or (8) or of a provision to which subsection (3) applies, the company, and every officer of the company who knowingly authorised or permitted the contravention, shall be jointly and severally liable to compensate any person to whom an offer should have been made under the subsection or provision contravened for any loss, damage, costs or expenses which that person has sustained or incurred by reason of the contravention; but no proceedings to recover any such loss, damage, costs or expenses shall be commenced after the expiration of two years from the delivery to the registrar of companies of the return of allotments in question or, where equity securities other than shares are granted, from the date of the grant. | ||
(12) In relation to any offer to allot any securities required by subsection (1) or by any provision to which subsection (3) applies, references in this section (however expressed) to the holder of shares of any description shall be read as including references to any person who held shares of that description on any day within the period of twenty-eight days ending with the day immediately preceding the date of the offer. | ||
(13) In this section and sections 24 and 25 — | ||
“equity security”, in relation to a company, means a relevant share in the company (other than a share shown in the memorandum to have been taken by a subscriber thereto or a bonus share) or a right to subscribe for, or to convert any securities into, relevant shares in the company, and references to the allotment of equity securities or of equity securities consisting of relevant shares of a particular class shall include references to the grant of a right to subscribe for, or to convert any securities into, relevant shares in the company or, as the case may be, relevant shares of a particular class, but shall not include references to the allotment of any relevant shares pursuant to such a right; | ||
“relevant employee shares”, in relation to a company, means shares of the company which would be relevant shares in the company but for the fact that they are held by a person who acquired them in pursuance of an employees' share scheme; and | ||
“relevant shares”, in relation to a company, means shares in the company other than— | ||
(a) shares which as respects dividends and capital carry a right to participate only up to a specified amount in a distribution; and | ||
(b) shares which are held by a person who acquired them in pursuance of an employees' share scheme, or, in the caseof shares which have not been allotted, are to be allotted in pursuance of such a scheme; | ||
and any reference to a class of shares shall be construed as a reference to shares to which the same rights are attached as to voting and as to participation, both as respects dividends and as respects capital, in a distribution. |