ADVOKS GLOBAL · KENYA
Companies Act
462. Payments apart from purchase price to be made out of distributable profits
Edition: 2024-12-27 · In force
462. Payments apart from purchase price to be made out of distributable profits
(1)A payment made by a company in consideration of—(a)acquiring any right with respect to the purchase of its own shares under a contingent purchase contract approved under section 451;(b)the variation of any contract approved under that section; or(c)the release of any of the company's obligations with respect to the purchase of any of its own shares under a contract approved under section 451 or 458,may be made only out of the company’s distributable profits.(2)If subsection (1) is contravened, the following provisions apply—(a)in a case within subsection (1)(a), a purchase by the company of its own shares under that contract cannot be made under this Division;(b)in a case within subsection (1)(b), such a purchase following the variation cannot be made under this Division; and(c)in a case within subsection (1)(c), purported release is void.