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Document containing offer of shares or debentures for sale to be deemed prospectus.
5, c. 23, s. 38.
14
40.-(1) Where a company allots or agrees to allot any shares in or debentures of the company with a view to all or any of those shares or debentures being offered for sale to the public, any document by which the offer for sale to the public is made shall for all purposes he deemed to be a prospectus issued by the company, and all enactments and rules of law as to 19 & 20 Geo. the contents of prospectuses and to liability in respect of statements in and omissions from prospectuses, or otherwise relating to prospectuses, shall apply and have effect accordingly, as if the shares or debentures had been offered to the public for subscription and as if persons accepting the offer in respect of any shares or debentures were subscribers for those shares or deben- tures, but without prejudice to the liability, if any, of the persons by whom the offer is made, in respect of mis-statements contained in the document or other- wise in respect thereof.
Prohibition
unless minimum subscription received. 19 & 20 Geo. 5, c. 23,
(2) For the purposes of this Ordinance, it shall, unless the contrary is proved, be evidence that an allotment of, or an agreement to allot, shares or deben- tures was made with a view to the shares or debentures being offered for sale to the public if it is shown---
(a) that an offer of the shares or debentures or of any of them for sale to the public was made within six months after the allotment or agree- ment to allot; or
(b) that at the date when the offer was made the whole consideration to be received by the com- pany in respect of the shares or debentures had not been so received.
(3) Section thirty-six of this Ordinance as applied by this section shall have effect as though the persons making the offer were persons named in a prospectus as directors of a company, and section thirty-seven of this Ordinance as applied by this section shall have effect as if it required a prospectus to state in addition to the matters required by that section to be stated in a prospectus-
(a) the net amount of the consideration received or to be received by the company in respect of the shares or debentures to which the offer relates; and
(b) the place and time at which the contract under which the said shares or debentures have been or are to be allotted may be inspected.
(4) Where a person making an offer to which this section relates is a company or a firm, it shall be sufficient if the document aforesaid is signed on behalf of the company or firm by two directors of the com- pany or not less than half of the partners, as the case may be, and any such director or partner may sign by his agent authorised in writing.
Allotment.
41. -(1) No allotment shall be made of any share of allotment capital of a company offered to the public for subs- cription unless the amount stated in the prospectus as the minimum amount which, in the opinion of the directors, must be raised by the issue of share capital in order to provide for the matters specified in paragraph 5 in Part I. of the Fourth Schedule to this Ordin- ance has been subscribed, and the sum payable on application for the amount so stated has been paid to and received by the company.
s. 39.
For the purposes of this subsection, a sum shall be deemed to have been paid to and received by the com- pany if a cheque for that sum has been received in good faith by the company and the directors of the company have no reason for suspecting that the cheque will not be paid.