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[s. 38 cont.]
Restriction on alteration of terms mentioned in prospectus or statement in lieu of prospectus.
Companies.
(5) This section shall not apply to the issue to existing members or debenture holders of a company of a prospectus or form of application relating to shares in or debentures of the company, whether an applicant for shares or debentures will or will not have the right to renounce in favour of other persons, but, subject as aforesaid, this section shall apply to a prospectus or a form of application whether issued on or with reference to the formation of a company or subsequently.
(6) Nothing in this section shall limit or diminish any liability which any person may incur under the general law or this Ordinance apart from this section.
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39. (1) A company limited by shares or a company limited by guarantee and having a share capital shall not vary the terms of a contract referred to in the prospectus, or statement in lieu of prospectus, except subject to the approval of the statutory meeting.
(2) This section shall not apply to a private company.
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40. (1) Where a prospectus invites persons to subscribe for shares in or debentures of a company-
(a) every person who is a director of the company at the time of the issue of the prospectus; and
(b) every person who has authorized himself to be named and is named in the prospectus as a director or as having agreed to become a director either immediately or after an interval of time; and
(c) every person being a promoter of the company; and
(d) every person who has authorized the issue of the prospectus,
shall be liable to pay compensation to all persons who subscribe for any shares or debentures on the faith of the prospectus for the loss or damage they may have sustained by reason of any untrue statement therein, or in any report or memorandum appearing on the face thereof, or by reference incorporated therein or issued therewith, unless it is proved-
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