ADVOKS GLOBAL · KENYA
The Companies (General) Regulations
46. Equity-linked agreements
Edition: 2022-12-31 · In force
46. Equity-linked agreements
(1)If, in any financial year of a company, the company has entered into an equity-linked agreement, a directors' report for the financial year is required to state—(a)the reason for entering into the agreement;(b)the nature and terms of the agreement including, if applicable—(i)the conditions that are required to be met before the company issues any shares;(ii)the conditions that is required to be met before a third party may require the company to issue any shares; and(iii)any monetary or other consideration that the company has received or will receive under the agreement;(c)the classes of shares issued under the agreement; and(d)for each class of shares, the number of shares that have been issued under the agreement.(2)If, at the end of a financial year of a company, there exists an equity-linked agreement entered into by the company, a directors' report for the financial year is required to state—(a)the classes of shares that may be issued under the agreement;(b)for each class of shares, the number of shares that may be issued under the agreement;(c)any monetary or other consideration that the company has received or will receive under the agreement; and(d)any other conditions or terms that remain to be met before the shares are issued.(3)In this regulation, "equity-linked agreement"—(a)means—(i)an agreement that will or may result in the company issuing shares; or(ii)an agreement requiring the company to enter into the agreement specified in sub-subparagraph (i); and(b)includes—(i)an option to subscribe for shares;(ii)an agreement for the issue of securities that are convertible into, or entitle the holder to subscribe for, shares in the company;(iii)an employee share scheme; and(iv)a share option scheme; but(c)does not include—(i)an agreement to subscribe for shares in a company that is entered into pursuant to the company's offer of its shares to the public; and(ii)an agreement to subscribe for shares in a company that is entered into pursuant to an offer made to the members of the company in proportion to their shareholdings;“offer” includes an invitation to the public to subscribe for shares in a company.