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CORPORATIONS ACT 2001

SCHEDULE 4 - TRANSFER OF FINANCIAL INSTITUTIONS AND FRIENDLY SOCIETIES    View history reference

Note: See section 1465A.

[CCH Note: The reference to "section 1465A" is a reference to the former Corporations Law.]

PART 5 - DEMUTUALISATIONS  

CLAUSE 29  - DISCLOSURE FOR PROPOSED DEMUTUALISATION  

29(1)  

If a modification of the constitution of an unlisted company registered under clause 3 of the transition provisions is proposed and the modification would have the effect of:


(a) varying or cancelling the rights of members, or a class of members, to the reserves of the company; or


(b) varying or cancelling the rights of members, or a class of members, to the assets of the company on a winding up; or


(c) varying or cancelling the voting rights of members or a class of members; or


(d) otherwise varying or cancelling rights so that Part 2F.2 (Class rights) applies; or


(e) allowing 1 of those variations or cancellations of rights;

the following rules apply:


(f) notice of the meeting of the company's members at which the proposed modification is to be considered must be accompanied by the documents listed in subclause (4);


(g) notice of the meeting may not be shortened under subsection 249H(2);


(h) the company must lodge with ASIC the notice and the documents referred to in paragraphs (4)(a) and (c) within 7 days after notice of the meeting is given.

29(2)  

If:


(a) an issue of shares by an unlisted company registered under clause 3 of the transition provisions would have the effect of varying or cancelling rights so that Part 2F.2 (Class rights) applies; and


(b) at least 1 of the following is required to approve the share issue, or variation or cancellation of rights:


(i) a meeting of the company's members;

(ii) a resolution passed at a meeting of the class of members concerned;

(iii) written consent of a specified proportion of members in the class concerned;

the following rules apply (in addition to those that apply under Part 2F.2):


(c) notice of the meeting or consent process must be accompanied by the documents listed in subclause (4);


(d) the company must lodge with ASIC the notice of the meeting or consent process and the documents referred to in paragraphs (4)(a) and (c) within 7 days after the notice is given;


(e) notice of the meeting may not be shortened under subsection 249H(2).

Paragraph (c) need not be complied with to the extent that a person has already been given the documents.

29(3)  

ASIC may exempt a company from this Part under clause 30.

29(4)  

The documents that must accompany the notice are:


(a) a disclosure statement that:


(i) satisfies clause 31; and

(ii) ASIC has registered under clause 32; and


(b) in the case of a proposed modification of the constitution of a company - an estimate of the financial benefits (if any) the member will be offered if the proposed modification occurs; and


(c) a report by an expert that:


(i) states whether, in the expert's opinion, the proposed modification or share issue is in the best interests of the members of the company as a whole; and

(ii) gives the expert's reasons for forming that opinion; and

(iii) complies with subclauses 33(2) and (3).

29(5)  

If the company contravenes subclause (1) or (2) it is not guilty of an offence.

29(6)  

A person contravenes this subclause if they are involved in a contravention of subclause (1) or (2).

Note 1: This subclause is a civil penalty provision.

Note 2: Section 79 defines involved.

29(7)  

A person commits an offence if they are involved in a contravention of subclause (1) or (2) and the involvement is dishonest.

Penalty: 2,000 penalty units or imprisonment for 5 years, or both.

29(8)  

In this clause:

reserves includes general reserves and retained earnings of the company.

unlisted company means a company (registered under clause 3) that does not have voting shares quoted on a prescribed financial market.


 



This information is provided by CCH Australia Limited. View the disclaimer and notice of copyright.
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