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Membership of holding company.
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32.—(1) Subject to the provisions of this section, a body corporate cannot be a member of a company which is its holding company, and any allotment or transfer of shares in a company to its subsidiary shall be void.
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(2) Nothing in this section shall apply where the subsidiary is concerned as personal representative, or where it is concerned as trustee, unless the holding company or a subsidiary thereof is beneficially interested under the trust and is not so interested only by way of security for the purposes of a transaction entered into by it in the ordinary course of a business which includes the lending of money.
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(3) This section shall not prevent a subsidiary which on the 5th day of May, 1959, was a member of its holding company, from continuing to be a member.
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(4) This section shall not prevent a company which at the date on which it becomes a subsidiary of another company is a member of that other company, from continuing to be a member.
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(5) This section shall not prevent a subsidiary which is a member of its holding company from accepting and holding further shares in the capital of its holding company if such further shares are allotted to it in consequence of a capitalisation by such holding company and if the terms of such capitalisation are such that the subsidiary is not thereby involved in any obligation to make any payment or to give other consideration for such further shares.
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(6) Subject to subsection (2), a subsidiary which is a member of its holding company shall have no right to vote at meetings of the holding company or any class of members thereof.
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(7) Subject to subsection (2), this section shall apply in relation to a nominee for a body corporate which is a subsidiary, as if references therein to such a body corporate included references to a nominee for it.
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(8) Where a holding company makes an offer of shares to its members it may sell, on behalf of a subsidiary, any such shares which the subsidiary could, but for this section, have taken by virtue of shares already held by it in the holding company, and pay the proceeds of sale to the subsidiary.
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(9) In relation to a company limited by guarantee, or unlimited, which is a holding company, the reference in this section to shares, whether or not it has a share capital, shall be construed as including a reference to the interests of its members as such, whatever the form of that interest.
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Private Companies.
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