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CORPORATIONS ACT 2001

CHAPTER 2H - SHARES  

PART 2H.2 - REDEMPTION OF REDEEMABLE PREFERENCE SHARES  

SECTION 254K  

254K  OTHER REQUIREMENTS ABOUT REDEMPTION  

A company may only redeem redeemable preference shares:


(a) if the shares are fully paid-up; and


(b) out of profits or the proceeds of a new issue of shares made for the purpose of the redemption.

Note 1: For a director's duty to prevent insolvent trading on redeeming redeemable preference shares, see section 588G.

Note 2: For the criminal liability of a person dishonestly involved in a contravention of this section, see subsection 254L(3). Section 79 defines involved.

[CCH Note: Act No 180 of 2012, s 3, Sch 7[1] contained the following application provision (which was effective 11 December 2012):

Application of amendments made by this Act

The amendments made by this Act apply in relation to an act or omission by a body corporate occurring on or after the day this Act commences.

]

 



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