OF THE

REPUBLIC OF NAMIBIA N$40.00 WINDHOEK - 30 December 2004 No.3362

CONTENTS

Page

GOVERNMENT NOTICE

No. 288 Promulgation of Companies Act, 2004 (Act No.28 of 2004), of the Parliament .

Government Notice

OFFICE OF THE PRIME MINISTER

No. 288 2004

PROMULGATION OF ACT OF PARLIAMENT

The following Act which has been passed by the Parliament and signed by the President in terms of the Namibian Constitution is hereby published in terms of Article 56 of that Constitution.

No. 28 of 2004: Companies Act, 2004.

2 Government Gazette 30 December 2004 No.3362

Act No. 28, 2004 COMPANIES ACT, 2004

ACT To provide for the incorporation, management and liquidation of companies;

and to provide for incidental matters.

(Signed by the President on 19December 2004)

ARRANGEMENT OF SECTIONS

Section

CHAPTER! INTERPRETATION AND APPLICATION OF ACT

1. Definitions 2. General application of Act 3. Application of Act restricted

CHAPTER 2 ADMINISTRATION OF ACT

Part 1 Companies Registration Office and Registrar

4. Companies Registration Office and register 5. Seal of Companies Registration Office 6. Appointment of Registrar, Deputy Registrar and delegation of power 7. Exemption from liability 8. Inspection and copies of documents in Companies Registration Office 9. Manner of payment of fees to Companies Registration Office 10. Annual report by Registrar

Part 2 Powers of Court and Procedure

11. Security for costs in legal proceedings by companies and bodies corporate 12. Copies of Court orders to be transmitted to Registrar and Master

Part 3 Regulations and Notices

13. Regulations 14. Prohibition of disclosure of, and exemption from obligation to disclose, certain

information 15. Notices amending or adding to Schedules

Part 4 Standing Advisory Committee

16. Establishment of Standing Advisory Committee 17. Functions and powers of SAC 18. Tenure of office 19. Administration, finance and procedures of SAC

No.3362 Government Gazette 30 December 2004 3 Act No. 28, 2004 COMPANIES ACT, 2004

CHAPTER 3 TYPES AND FORMS OF COMPANIES, CONVERSIONS AND LIMITATIONS

ON PARTNERSHIPS AND ASSOCIATIONS

Part 1 Types of Companies

20. Companies having share capital and companies not having share capital 21. Non-profit associations 22. Meaning of "private company" and cessation of its privileges 23. Incorporation of certain branches of foreign companies and non-profit associations

Part 2 Conversion of Companies

24. Conversion of public company, having share capital into private company, and vice versa

25. Conversion of company into incorporated non-profit association or company limited by guarantee

26. Conversion of company limited by guarantee into company having share capital 27. Conversion of unlimited company 28. Notice of intended conversion of company 29. Contents and form of articles on conversion 30. Registration of conversion 31. Effect of conversion and alteration of other registers

Part 3 Conversion of Companies and Close Corporations

32. Conversion of company into close corporation 33. Conversion of close corporation into company 34. Effect of conversion of close corporation into company

Part 4 Limitations on Partnerships and Associations for Gain

35. Prohibition of associations or partnerships exceeding 20 members and exemption 36. Unregistered associations carrying on business for gain not corporate bodies

'--

CHAPTER 4 FORMATION, OBJECTS, CAPACITY, POWERS, NAMES, REGISTRATION AND INCORPORATION OF COMPANIES, INCIDENTAL MATTERS AND

DEREGISTRATION

Part 1 Formation, Capacity, Powers and Objects

37. Mode offorming company 38. Capacity, powers and objects 39. Ancillary objects and powers of company 40. Dealings between company and other persons 41. No constructive knowledge 42. Power as to pre-incorporation contracts 43. Loans made and security provided by subsidiary 44. No financial assistance to purchase shares of company or holding company 45. Company not to be member of its holding company 46. No division into interests, rights to profits or shares in guarantee companies

4 Government Gazette 30 December 2004 No.3362

Act No. 28, 2004 COMPANIES ACT, 2004

Part 2 Names of Companies

47. Names of companies not to be undesirable 48. Reservation of name 49. Registration of shortened form of name or defensive name 50. Change of name and effect 51. Order to change name 52. Provisions as to order to change name 53. Registrar may call for affidavits and must give reasons for decisions as to names 54. Recourse to Court in matters as to names 55. Formal requirements as to names of companies 56. Use and publication of name by company 57. Improper use of word "Limited" or "Incorporated" an offence 58. Savings regarding certain existing name registrations

Part 3 Memorandum of Association

59. Requirements for memorandum of association 60. Memorandum may contain special conditions and provide for unlimited liability

of directors 61. Form and signing of memorandum

Part 4 Alteration of Memorandum

62. Alteration of memorandum as to special conditions and other provisions 63. Lodgment of altered memorandum

Part 5 Articles of Association

64. Companies to have articles 65. Form and signing of articles 66. Consolidation of articles 67. Alteration of articles

Part 6 Registration, Incorporation and Deregistration

68. Registration of memorandum and articles 69. Memorandum and articles to be in official language 70. Certificate of incorporation and its evidential value 71. Effect of incorporation on company and members 72. Liability of members where membership reduced below minimum 73. Rights of members to copies of memorandum and articles 74. Cancellation of registration of memorandum and articles

Part 7 Incidental Matters

75. Issued copies of memorandum or articles to embody alterations 76. Contracts by companies 77. Promissory notes and bills of exchange 78. Service of documents on companies 79. Arbitration between companies and others

No.3362 Government Gazette 30 December 2004 5 Act No. 28, 2004 COMPANIES ACT, 2004

CHAPTERS SHARE CAPITAL, ACQUISITION BY COMPANIES OF OWN SHARES, SHARES, ALLOTMENT AND ISSUE OF SHARES, MEMBERS AND

REGISTER OF MEMBERS, DEBENTURES, TRANSFER AND RESTRICTIONS ON OFFERING SHARES FOR SALE

Part 1 Share Capital

80. Division of share capital into shares having par value or having no par value 81. Company may alter share capital and shares 82. Premiums received on issue of shares to be share capital, and limitation on

application 83. Proceeds of issue of shares of no par value to be stated capital 84. Effect of conversion of par value share capital into no par value share capital and

vice versa 85. Payment of interest out of capital in certain cases 86. Restriction of power to pay commission and discounts 87. Issue of shares of par value at discount 88. Issue price of shares of no par value requiring special resolution

Part 2 Acquisition by Companies of own Shares

89. Approval of acquisition of own shares by special resolution 90. Company to be solvent 91. Consequences of acquisition with regard to shares 92. Liability of shareholders under certain circumstances 93. Procedure of acquisition of certain shares by company 94. Enforceability of contracts for acquisition by company of certain shares 95. Subsidiaries may acquire certain shares in holding company 96. Payments to shareholders

Part 3 Shares and Allotment and Issue

97. Nature of shares and payment for shares 98. Uncertificated securities 99. Register and return as to allotments 100. Certificate of shares or stock 101. Numbering of shares and share certificates 102. Limitation of time for issue of share certificates 103. Validation of irregular creation, allotment or issue of shares 104. Redeemable preference shares 105. Conversion of shares into certain preference shares 106. Conversion of shares into stock 107. Share warrants to bearer 108. Variation of rights in respect of shares 109. No offer of shares for sale to public without statement

Part 4 'Members and Register of Members

110. Members of company 111. Trusts in respect of shares 112. Register of members 113. Index to register of members 114. Branch registers in foreign countries

8 Government Gazette 30 December 2004 No.3362

Act No. 28, 2004 COMPANIES ACT, 2004

189. Calling of general meetings on requisition by members 190. Convening of general meetings by Registrar 191. General meetings on order of Court 192. Meetings of company with one member 193. Duty of company to circulate notice of resolutions and statements by members 194. Notice of meetings and resolutions 195. Manner of giving notice 196. Representation of company or other body corporate at certain meetings 197. Representation of members at meetings by proxies 198. Quorum for meetings 199. Chairperson of meetings 200. Compulsory adjournment of meetings

Part 3 Voting Rights and Voting

201. Voting rights of shareholders 202. Voting rights of preference shareholders 203. Determination of voting rights 204. Exceptions as regards voting rights 205. Exercise of voting rights 206. Right to demand poll

Part 4 Special Resolutions

207. Requirements for special resolutions 208. Registration of special resolutions 209. Alteration of memorandum or articles to pass special resolution 210. Special resolution to lapse unless registered 211. Dates on which resolutions take effect

Part 5 Minutes, Minute Books and Reports of Meetings

212. Keeping of minutes of meetings 213. Validity of proceedings 214. Right of members to inspect minute books 215. Publication of reports of meetings

CHAPTER 8 DIRECTORS

Part 1 Number and Appointment

216. Number of directors 217. Determination of number of directors and appointment of first directors 218. Appointment of directors to be voted on individually 219. Consent to act as director or officer 220. Filling of vacancy where director is disqualified or removed 221. Qualification shares of directors 222. Validity of acts where appointment is defective

Part 2 Register of Directors and Officers

223. Register of directors, officers and corporate secretaries ~ _.1. ~-~ ~~ rl ~+N"\1'Y1""nv in resnect of register

No.3362 Government Gazette 30 December 2004 9 Act No. 28, 2004 COMPANIES ACT, 2004

Part 3 Disqualifications of Directors

225. Disqualifications of directors 226. Disqualification of directors, officers and others by Court 227. Register of disqualification orders 228. Removal of directors and procedures in that regard

Part 4 Restrictions on Directors, their Powers and Certain Acts

229. 230. 231.

"........-- 232. 233. 234.

235.

236.

Restriction of power of directors to issue share capital Restriction on issue of shares and debentures to directors Share option plans where director is interested Director not to deal in options in respect of listed shares and debentures Prohibition on tax free payments to directors Prohibition of loans to, or security in connection with transactions by, directors and managers Payments to directors for loss of office or in connection with arrangements and take-over schemes Disposal of undertaking or greater part of assets of company

Part 5 Interests of and Dealings by Directors and Others in Shares of Company

237. Definitions for purposes of this Part 238. Register of interests of directors and others in shares and debentures of company 239. Directors to determine officers for purpose of register 240. Duty of directors and others as to register of interests 241. Offence to deal in shares with inside information before public announcement

Part 6 Interests of Directors and Officers in Contracts

242. Duty of director or officer to disclose interest in contracts 243. Manner of and time for declaration of interest 244. Written resolution where director is interested 245. Disclosure by interested director or officer acting for company 246. When particulars of interest to be stated in notice of meeting 247. Minuting of declarations of interest 248. Register of interests in contracts of directors and officers and its inspection 249. Duty of auditor as to register of interests in contracts

Part 7 Proceedings at Meetings of Directors and Managers

250. Keeping of minutes of meetings of directors and managers 251. Validity of proceedings at meetings of directors and managers 252. When resolution at adjourned meetings of directors and managers becomes effective 253. Attendance register of meetings of directors and managers 254. Duty of auditor as to minute books and attendance register

Part 8 Indemnity and Relief of, and Offences by, Directors and Others

255. Exemption from indemnity against liability of directors, officers or auditors 256. Relief of directors and others by Court in certain cases 257. False statements and evidence

10 Government Gazette 30 December 2004 No.3362

Act No. 28, 2004 COMPANIESACT, 2004

258. Falsification of books and records 259. False statement by directors and others

CHAPTER 9 REMEDIES OF MEMBERS AND INVESTIGATIONS

Part 1 Relief from Oppression

260. Remedy of member in case of oppressive or unreasonably prejudicial conduct

Part 2 Inquiry into Membership and Ownership of Shares and Control of Company

261. Power of Registrar to request information concerning shares and members 262. Appointment and powers of inspectors to investigate financial interest in and control

of company 263. Power to require information as to interest in shares or debentures 264. Power to impose restrictions on shares or debentures

Part 3 Investigation into Affairs of Company

265. Inspection of affairs of company on application of members 266. Investigation of affairs of company in other cases 267. Power of inspector to conduct investigation into affairs of related companies 268. Production of documents and evidence on investigation 269. Report of inspector 270. Proceedings on report of inspector

Part 4 Matters Incidental to Investigations

271. Expenses of and incidental to investigation of affairs of company 272. Saving in respect oflegal practitioners and bankers 273. Report of inspectors to be evidence

Part 5 Proceedings on Behalf of Companies

274. Initiation of proceedings on behalf of company by member 275. Powers of curator 276. Security for costs by applicant for appointment of curator

CHAPTER 10 AUDITORS

Part 1 Appointment

277. First appointment of auditor of company 278. Annual appointment of auditor 279. Failure to appoint auditor 280. Minister may appoint joint auditor 281. Filling of casual vacancies 282. Firm may be appointed auditor 283. Disqualification for appointment as auditor 284. Consent by, and notice, entry and lodging of information pertaining to, auditor

No.3362 Government Gazette 30 December 2004 11

Act No. 28, 2004 COMPANIES ACT, 2004

Part 2 Removal and Resignation of Auditor

285. Removal of auditor appointed by directors or Registrar, and filling of vacancy 286. Removal of auditor and appointment of new auditor 287. Special notice for removal of auditor 288. Resignation of auditor

Part 3 Rights, Duties and Remuneration

289. Right of auditor to access of books and to be heard at general meetings 290. Duties of auditor 291. Remuneration of auditor

CHAPTER 11 ACCOUNTING AND DISCLOSURE

Part 1 Accounting Records

292. Duty of company to keep accounting records 293. Determination of financial year of company 294. Duty to make out annual financial statements and to present them before annual

general meeting 295. Offence to issue incomplete financial statements and circulars

Part 2 Accounting by Holding Companies

296. Obligation to present group statements before annual general meeting 297. Group annual financial statements ' 298. Where annual financial statements are to be consolidated 299. Where group annual financial statements need not deal with subsidiary 300. Accounting periods of company and subsidiary to be the same 301. Duty of auditor to report on decisions of directors on group annual financial

statements

Part 3 Disclosure of Certain Matters in Financial Statements and Further Requirements

302. Disclosure of loans to and security for benefit of directors and managers 303. Disclosure of loans made to and security provided for benefit of directors or

managers before their appointment 304. Disclosure of emoluments and pensions of directors 305. Approval and signing of financial statements 306. Duty of company to send annual financial statements to members and Registrar 307. Report of directors

Part 4 Duties of Auditor as to Annual Financial Statements

308. Duties of auditor as to annual financial statements and other matters 309. Report of auditor

Part 5 Interim Accounting

310. Half-yearly interim reports

12 Government Gazette 30 December 2004 No.3362

Act No. 28, 2004 COMPANIES ACT, 2004

311. Provisional annual financial statements 312. Form and contents of interim report and provisional annual financial statements 313. Copies of interim report and provisional annual financial statements to be lodged

with Registrar 314. Registrar may grant exemptions and extensions of time 315. Offences under sections 310 to 313, inclusive

Part 6 Right of Members and Others to Copies of Annual Financial Statements and Interim

Reports

316. Right of members and others to copies of annual financial statements and interim reports

CHAPTER 12 COMPROMISE, ARRANGEMENT AND AMALGAMATION

317. Compromise and arrangement between company, its members and creditors 318. Information as to compromises and arrangements 319. Provisions facilitating reconstruction or amalgamation 320. Take-over offers 321. Contents of take-over statement by offeror 322. Duty of directors of offeree company to furnish take-over statement 323. Contents of take-over statement by directors of offeree company 324. Statement by the directors of offeree company in case of counter bid 325. Requirements for take-over offer may be waived 326. Liability and offences in regard to take-over offers 327. Power to acquire shares of minority in take-over scheme

CHAPTER 13 EXTERNAL COMPANIES

Part 1 Registration

328. Registration of memorandum of external company 329. Effect of registration of memorandum of external company 330. Power of external company to own immovable property in Namibia

Part 2 Administrative and Other Duties of External Companies

331. External company to have auditor 332. External company to have person authorised to accept service 333. Register of directors and managers and secretaries and power of Registrar to request

particulars 334. Changes in memorandum of external company 335. External company to keep accounting records and lodge annual financial statements

and interim report 336. External companies to lodge annual return 337. Further administrative duties of external company 338. Deregistration of external company 339. Offences in respect of external companies 340. Transfer of undertaking of external company and exemption from transfer duty

under scheme 341. Registration of external companies as companies in Namibia

No.3362 Government Gazette 30 December 2004 13

Act No. 28, 2004 COMPANIESACT, 2004

CHAPTER 14 WINDING-UP OF COMPANIES

Part 1 General

342. Definitions for purposes of winding-up of companies 343. Application of Companies Act, 1926, where winding-up has already commenced 344. Law of insolvency to apply with the necessary changes 345. Voidable and undue preferences 346. Dispositions and share transfers after winding-up void 347. Application of assets and costs of winding-up 348. Modes of winding-up

Part 2 Winding-up by Court

349. Circumstances in which company may be wound up by Court 350. When company is deemed unable to pay debts 351. Application for winding -up of company 352. Power of Court in hearing application 353. Commencement of winding-up by Court

Part 3 Voluntary Winding-up

354. Circumstances under which company may be wound up voluntarily 355. Voluntary winding-up of members and security 356. Voluntary winding-up of creditors 357. Commencement of voluntary winding-up 358. Effect of voluntary winding-up on status of company and on directors

Part 4 General Provisions Affecting all Windings-up

359. Court may stay aside winding-up 360. Notice to creditors or members in review by Court in winding-up 36l. Notice of winding-up of company 362. Notice of winding-up to certain officials and their duties 363. Stay oflegal proceedings before winding-up order granted 364. Legal proceedings suspended and attachments void 365. Inspection of records of company being wound up 366. Custody of or control over and vesting of property of company 367. Court may order directors and others to deliver property to liquidator or to pay

into bank 368. Directors and others to submit statement of affairs 369. Change of address of directors and secretaries to be given to liquidator 370. Master to summon first meetings of creditors and members and purpose 371. Offences in securing nomination as liquidator 372. Restriction on voting at meetings 373. Claims and proof of claims

Part 5 Liquidators

374. Appointment of liquidator 375. Appointment of provisional liquidator 376. Determination of person to be appointed liquidator

14 Government Gazette 30 December 2004 No.3362

Act No. 28, 2004 COMPANIES ACT, 2004

377. Master may decline to appoint nominated person as liquidator 378. Remedy of aggrieved persons 379. Persons disqualified from appointment as liquidator 380. Persons disqualified by Court from being appointed or acting as liquidators 381. Master may appoint co-liquidator at any time 382. Appointment, commencement of office and validity of acts of liquidator 383. Title ofliquidator 384. Filling of vacancies 385. Leave of absence or resignation of liquidator 386. Removal ofliquidator by Master and by Court 387. Control of Master over liquidators 388. Plurality ofliquidators, liability and disagreement 389. Cost and reduction of security by liquidator 390. Remuneration ofliquidator 391. Certificate of completion of duties by liquidator and cancellation of security

Part 6 Powers of Liquidators

392. General powers 393. Power ofliquidator in winding-up by Court 394. Court may determine questions in voluntary winding-up 395. Exercise of power to make arrangement and the binding of dissentient creditors 396. Power ofliquidator in voluntary winding-up to accept shares for assets of company

Part 7 Duties of Liquidators

397. General duties 398. Duty of liquidator to give information to Master 399. Duty of liquidator to keep records and inspection of records 400. Banking accounts and investments 401. Duties of liquidator as to contributories 402. Notices to contributories and objections 403. Recovery of contributions and nature of liability 404. Adjustment of rights of contributories 405. Evidence as to contributions and contributories 406. Duty of liquidator to expose offences and to report 407. Prosecutor-General may make application to Court for disqualification of director 408. Duty of liquidator to present report to creditors and contributories 409. Duty ofliquidator to file liquidation and distribution account 410. Master may grant extension of time for lodging account 411. Failure of liquidator to lodge account or to perform duties 412. Places for and periods of inspection of account 413. Objections to account 414. Confirmation of account 415. Distribution of estate 416. Duty of liquidator as to receipts and unpaid dividends 417. Payment of money deposited with Master

Part 8 Meetings in Winding-up

418. Meetings of creditors and members and voting at meetings of creditors 419. Meetings to ascertain wishes of creditors and others 420. Duty of directors and officers to attend meetings 421. Examinations of directors and others at meetings 422. Application of Insolvency Act, 1936

No.3362 Government Gazette 30 December 2004 15 Act No. 28, 2004 COMPANIES ACT, 2004

Part 9 Examination of Persons in Winding-up

423. Summoning and examination of persons as to affairs of company 424. Examination by commissioners

Part 10 Dissolution of Companies and other Bodies Corporate

425. Dissolution 426. Court may declare dissolution void 427. Registrar to keep register of directors of dissolved companies 428. Disposal of records of dissolved company

Part 11 Personal Liability of Delinquent Directors and Others and Offences

429. Delinquent directors and others to restore property and to compensate the company 430. Liability of directors and others for fraudulent conduct of business 431. Application of criminal provisions of the law relating to insolvency 432. Private prosecution of directors and others

CHAPTER 15 JUDICIAL MANAGEMENT

433. Circumstances in which company may be placed under judicial management 434. Provisional judicial management order 435. Custody of property and appointment of provisional judicial manager 436. Duties of provisional judicial manager 437. Purpose of meeting convened under section 435(b)(ii) 438. Return day of provisional order of judicial management and powers of Court 439. Duties of final judicial manager 440. Application of assets during judicial management 441. Remuneration of provisional judicial manager or judicial manager 442. Pre-judicial management creditors may consent to preference 443. Voidable and undue preferences in judicial management 444. Period of judicial management to be discounted in determining preference under

mortgage bond 445. Position of auditor in judicial management 446. Application to judicial management of certain provisions of winding-up 447. Cancellation of judicial management order

CHAPTER 16 TRANSITIONAL AND MISCELLANEOUS PROVISIONS

448. Preservation of rights of existing companies 449. Transitional provisions as to unlimited companies and partly paid up shares 450. Regulations under repealed Act relating to winding up and judicial management

CHAPTER 17 REPEAL OF LAWS AND COMMENCEMENT OF ACT

451. Repealoflaws 452. Short title and commencement

16 Government Gazette 30 December 2004 No.3362 Act No. 28, 2004 COMPANIES ACT, 2004

SCHEDULES

Schedule 1 Schedule 2 Schedule 3

Tables A and B Common Powers of Companies Matters which must be Stated in a Prospectus in Addition to those Specified in the Act Requirements for Annual Financial Statements and Interim Reports Repeal of Laws

Schedule 4

Schedule 5

BE IT ENACTED by the Parliament ofthe Republic of Namibia as follows:-

CHAPTERl INTERPRETATION AND APPLICATION OF ACT

Definitions

1. (1) In this Act, unless the context otherwise indicates -

"accounting records", in relation to a company, includes accounts, deeds, writings and other documents;

"annual duty" means the annual duty referred to in section 182;

"annual return" means the annual return referred to in section 181;

"articles", in relation to a company, means the articles of association ofthat company for the time being in force, and includes any provision, in so far as it applies in respect of that company, set out in Table A or Table B in Schedule 1;

"auditor" means a person who is, under section 23 ofthe Public Accountants' and Auditors' Act, 1951 (Act No. 51 of 1951), registered as an accountant and auditor and who has been appointed as an auditor under this Act;

"books or papers" and "books and papers" include accounts, deeds, writings and other documents;

"certified" means certified in the manner prescribed by the Minister to be a true copy or a correct translation;

"close corporation" means a corporation as defined in section 1 of the Close Corporations Act, 1988, (Act No. 26 of 1988);

"Companies Act, 1926," means the Companies Act, 1926 (Act No. 46 of 1926), referred to in section 442 of the repealed Act";

"company" means a company incorporated under Chapter 4 of this Act and includes any body which, immediately before the commencement ofthis Act, was a company in terms of the repealed Act;

"Court", in relation to any company or other body corporate, means the High Court and, in relation to any offence under this Act, includes a magistrate's court having jurisdiction in respect of that offence;

"debenture" includes debenture stock, debenture bonds and any other securities of a company, whether constituting a charge on the assets of the company or not;

No.3362 Government Gazette 30 December 2004 17 Act No. 28, 2004 COMPANIES ACT, 2004

"director" includes any person occupying the position of director or alternate director of a company, by whatever name that person may be designated;

"equity share capital" and "equity shares", in relation to a company, means its issued share capital and shares, excluding any part which, neither with regard to dividends nor with regard to capital, carries any right to participate beyond a specified amount in a distribution;

"existing company" means any body which, before the commencement of this Act, was a company in terms of the repealed Act;

"external company" means a company or other association of persons, incorporated outside Namibia, which has a place of business in Namibia, or which was an external company in terms of the repealed Act;

"foreign country" means any state, country or territory other than Namibia;

"holding company" means a holding company as defined in subsection (4);

"judicial manager" means the final judicial manager referred to in section 438;

"liquidator", in relation to a company, means the person appointed under Chapter 14 as liquidator of that company, and includes any co-liquidator and any provisional liquidator so appointed;

"manager", in relation to a company, means any person who is a principal executive officer of the company for the time being, by whatever name designated and whether or not that person is a director;

"Master" means the Master of the High Court;

"memorandum", in relation to a company, means the memorandum of association of that company for the time being in force, and in relation to an external company, means the charter, statutes, memorandum of association and articles, or other instrument constituting or defining the constitution of the company;

"Minister", in relation to any matter to be dealt with in the office of the Master in connection with the winding-up or judicial management of companies, means the Minister responsible for Justice and, in relation to any other matter, means the Minister responsible for Trade and Industry;

"officer", in relation to a company, includes any managing director, manager or secretary but excludes a secretary which is a body corporate;

"official language" means the official language of Namibia referred to in Article 3 of the Namibian Constitution;

"place of business" means any place where the company transacts or holds itself out as transacting business and includes a share transfer or share registration office;

"prescribed" means prescribed by regulation made under this Act;

"prospectus" means any prospectus, notice, circular, advertisement or other invitation offering any shares of a company to the public;

"provisional judicial manager" means a provisional judicial manager appointed by the Master under section 435;

18 Government Gazette 30 December 2004 No.3362 Act No. 28, 2004 COMPANIES ACT, 2004

"Registrar" means the Registrar of Companies appointed under section 6;

"regulations" means the regulations made under this Act;

"SAC" means the Standing Advisory Committee established by section 16;

"secretary" includes any official of a company by whatever name designated, including a body corporate, performing the duties normally performed by a secretary of a company;

"share", in relation to a company, means a share in the share capital ofthat company and includes stock, and in relation to an offer of shares for subscription or sale, includes a share and a debenture of a company, whether a company within the meaning of this Act or not, and any rights or interests, by whatever name called, in a company or in or to that share or debenture;

"share warrant" means the warrant referred to in section 107(1);

"special resolution", in relation to a company, means a resolution passed at a general meeting of that company in the manner provided for by section 207;

"staff member" means a staff member as defined in section 1(1) of the Public Service Act, 1995 (Act No. 13 of 1995);

"subsidiary company" or "subsidiary" means a subsidiary company as defined in subsection (3);

"the repealed Act" means the Companies Act, 1973 (Act No. 61 of 1973);

"this Act" includes the regulations;

"wholly owned subsidiary" means a wholly owned subsidiary as defined in subsection (5); and

"winding-up order" means any order of court whereby a company is wound up and includes any order of court whereby a company is placed under provisional winding-up for so long as that order is in force.

(2) A person is not deemed to be, within the meaning of this Act, a person in accordance with whose directions or instructions the directors of a company are accustomed to act by reason only that the directors of the company act on advice given by him or her in a professional capacity.

(3) For the purposes of this Act, a company is deemed to be a subsidiary of another company if -

(a) that other company is a member of it and-

(i) holds a majority of the voting rights in it; or

(ii) has the right to appoint or remove directors holding a majority of the voting rights at meetings of the board; or

(iii) has the sole control of a majority of the voting rights in it, whether pursuant to an agreement with other members or otherwise; or

(b) it is a subsidiary of any company which is a subsidiary of that other company; or

(c) subsidiaries of that other company or that other company and its subsidiaries together hold the rights referred to in paragraph (a).

No.3362 Government Gazette 30 December 2004 19 Act No. 28, 2004 COMPANIES ACT, 2004

(4) In determining whether a company holds the majority of the voting rights as contemplated in subsection (3)(a)(i) -

(a) voting rights which are exercisable only in certain circumstances must be taken into account only -

(i) when those circumstances have arisen, and for so long as they continue; or

(ii) when those circumstances are under the control of the person holding the voting rights;

(b) voting rights held by a person in a fiduciary capacity must be treated as no!,,' held by him or her but by the beneficiary of those voting rights;!( '.

(c) voting rights held by a person as nominee for another person must be treated as not held by him or her but by that other person, and voting rights are deemed to be held by a nominee for another person if they are exercisable only on the instructions or with the consent or concurrence of that other person.

(5) A body corporate or other undertaking which would have been a subsidiary of a company had the body corporate or other undertaking been a company is deemed to be a subsidiary of that company.

(6) For the purposes ofthis Act, a company is deemed to be a holding company of another company if that other company is its subsidiary.

(7) For the purposes of this Act, a subsidiary is deemed to be a wholly owned subsidiary of another company if it has no members except that other company and a wholly owned subsidiary of that other company and its or their nominees.

(8) Where in this Act, reference is made to days within which anything is to be done, Saturdays, Sundays and public holidays must be excluded in calculating the days.

General application of Act

2. This Act applies to every company incorporated under this Act, every external company and, save as is otherwise provided in this Act, to every existing company.

Application of Act restricted

3. This Act does not apply to -

(a) any company the formation, registration and management of which is governed by any law relating to building societies, friendly societies, including pension funds, within the meaning of the Pension Funds Act, 1956 (Act No. 24 of 1956), trade unions and employers' organisations, or co-operative societies or companies, save in so far as may be otherwise provided in that law;

(b) any company or external company or society which is subject to any law relating to banks or insurance companies or societies in so far as that law is inconsistent with this Act.

20 Government Gazette 30 December 2004 No.3362

Act No. 28, 2004 COMPANIES ACT, 2004

CHAPTER 2 ADMINISTRATION OF ACT

Part 1 Companies Registration Office and Registrar

Companies Registration Office and register

4. (1) The Companies Registration Office established in Windhoek under section 5 of the repealed Act continues to exist and is the Companies Registration Office for the purposes of this Act.

(2) Notwithstanding subsection (1), the Minister may by notice in the Gazette, declare any other place to be a Companies Registration Office for the purposes of this Act.

(3) The Registrar must, in the Companies Registration Office, keep a register of companies in which must be recorded the registration of any company and any other matter for which provision is made in this Act.

(4) The register of companies kept by the Registrar under the repealed Act is deemed to be and to form part of the register of companies to be kept in the Companies Registration Office.

Seal of the Companies Registration Office

5. There is a seal of the Companies Registration Office and the impression of that seal must be judicially noticed in evidence.

Appointment of Registrar, Deputy Registrar and delegation of power

6. (1) The Minister must, subject to the laws governing the public service, appoint a Registrar of Companies, who must -

(a) exercise the powers and perform the duties assigned to the Registrar by this Act;

(b) subject to the directions of the Minister, be responsible for the administration of the Companies Registration Office; and

(c) if authorised by the Minister in writing and subj ect to any conditions which the Minister may determine, exercise any power and perform any duty assigned to the Minister by sections 14,266(1), 267, 269, 271(1)(b), 280 and 335(7).

(2) The Minister may, subject to the law governing the public service, appoint a Deputy Registrar, who must, subject to the control ofthe Registrar, exercise any power or carry out any duty granted or assigned to the Registrar by this Act, and, when the office of Registrar is vacant or when the Registrar is absent or is for any other reason unable to perform his or her functions, the Deputy Registrar must act temporarily in his or her place.

(3) The person holding office as Registrar of Companies under the repealed Act, is deemed to have been appointed as the Registrar of Companies under this Act.

(4) The Registrar may in writing delegate any of the powers and entrust any of the duties assigned to him or her by this Act, to any staff member, except for the powers and duties entrusted or assigned to him or her by section 10 and, in so far as they relate to giving notice in the Gazette, sections 30(3),33(6),49(5), 50(3)(b)(iii), 74(2) and (3), 98, 149(2) and 425(2).

No.3362 Government Gazette 30 December 2004 21 Act No. 28, 2004 COMPANIES ACT, 2004

Exemption from liability

7. (1) No act or omission by the Registrar or any staff member or other person in the employment of the State, having duties to perform under this Act, subjects the State, or the Registrar, or that staff member or person to any liability for any loss or damage sustained by any person in consequence of that act or omission unless that act or omission was done in bad faith or was due to a lack of reasonable care or diligence.

(2) An auditor, a liquidator, a judicial manager or a provisional judicial manager is not liable in respect of any opinion expressed or certificate given or report or statement made or statement, account or document certified by him or her in good faith in the ordinary course of his or her duties under this Act, unless it is proved that that opinion was expressed or that certificate was given or that report or statement was made or that statement, account or document was certified maliciously or negligently.

Inspection and copies of documents in Companies Registration Office

8. (1) Subject to subsection (4), any person may, on payment of the prescribed fee -

(a) inspect the documents lodged under this Act with the Registrar;

(b) obtain a certificate from the Registrar as to the contents or part of the contents of any document kept by him or her under this Act in respect of any company and which is open to inspection; or

(c) obtain a copy of or extract from that document.

(2) If the Registrar is satisfied -

(a) that an inspection, certificate, copy or extract is required on behalf of any foreign government; and

(b) that no fees are payable in the foreign country concerned in respect of that inspection, certificate, copy or extract required on behalf ofthe Government of Namibia;

no fee referred to in subsection (1) is payable.

(3) If the Registrar is satisfied that any inspection, certificate, copy or extract is required for purposes of research by or under the control of an institution for higher education, the Registrar may permit that inspection, or furnish that certificate or copy or an extract, without payment of those fees.

(4) No person may inspect a document referred to in subsection (1) or obtain a certificate as to the contents or part of the contents or obtain a copy of the document or an extract from the document, if the Registrar is satisfied that that document contains particular information or a particular fact concerning the affairs or business of a company, or of any of its subsidiaries, which information or fact the company has been prohibited under section 14(1) from disclosing or from stating on or in any document, or which information or fact the company has been exempted under that section from any obligation so to disclose or state.

(5) Subsection (4) does not apply to those portions of that document which do not contain or refer to or give any indication of the particular information or particular fact which the company has been prohibited or exempted from disclosing or stating.

22 Government Gazette 30 December 2004 No.3362

Act No. 28, 2004 COMPANIES ACT, 2004

Manner of payment of fees to Companies Registration Office

9. (1) The payment of all fees, additional fees, annual duty or other moneys payable to the Registrar as laid down by this Act must be effected in the prescribed manner.

(2) No document, form, return or notice in respect of which any fee or payment is determined under this Act, is complete unless proof of payment of the prescribed fee, additional fees, annual duty or other moneys has been delivered to the Registrar.

(3) Any fees, additional fees, annual duty and any other moneys payable under this Act to the Registrar are debts due to the State recoverable by the Minister in any competent court, and do, unless otherwise provided, accrue to the State Revenue Fund.

Annual report by Registrar

10. The Registrar must, in every calendar year, submit to the Minister a report containing information concerning the registration of companies of each type, their authorised capitals or numbers of shares, increases in and reductions of capital, prospectuses, windings-up, judicial managements, deregistrations and dissolutions of companies, additional fees collected, prosecutions and convictions under this Act and other matters which the Minister may direct.

Part 2 Powers of Court and Procedure

Security for costs in legal proceedings by companies and bodies corporate

11. Where a company or other body corporate is the plaintiff or applicant in any legal proceedings, the Court may at any stage, if it appears by credible testimony that there is reason to believe that the company or body corporate or, if it is being wound up, the liquidator of the company, will be unable to pay the costs of the defendant or respondent if the defence of the latter is successful, require sufficient security to be given for those costs and may stay all proceedings until the security is given.

Copies of Court orders to be transmitted to Registrar and Master

12. Where any Court makes any order under this Act in relation to any company, the Registrar of the Court must, without delay, send a copy of the order to the Registrar and if that order relates to the winding-up or judicial management of any company, also a copy to the Master.

Part 3 Regulations and Notices

Regulations

13. (I) The Minister may, after consultation with the Minister responsible for Justice where appropriate, make regulations -

(a) providing for the conduct and administration of the Companies Registration Office and prescribing the practice and procedure to be observed in that office;

(b) prescribing the practice and procedure to be observed in the office of the Master in connection with the winding-up and judicial management of companies;

No.3362 Government Gazette 30 December 2004 23

Act No. 28, 2004 COMPANIES ACT, 2004

(c) providing for the reproduction of any records in the Companies Registration Office or the office of the Master by microfilm, microcard, miniature photographic process or any other process deemed suitable by the Minister;

(d) providing for the use for official purposes and the admissibility in evidence in any proceedings, whether in a court of law or otherwise, of any reproduction contemplated in paragraph (c);

(e) providing for the keeping and preservation of any records, or any reproduction contemplated in paragraph (c), in the Companies Registration Office or the office of the Master, the removal from those offices and preservation in any other place of those records or reproductions and prescribing the circumstances under which those records or reproductions may be destroyed;

(f) prescribing how records required under this Act to be kept by a company may be kept, and prescribing the circumstances under which those records may be destroyed;

(g) prescribing the procedure to be followed with respect to any matter in connection with the winding-up and judicial management of companies;

(h) prescribing the form and the contents of any return, notice or form provided for by this Act;

(i) prescribing when an additional copy or copies of documents to be lodged under the Act are to be lodged and whether the additional copy or copies are to be in the form of a copy or copies certified in the manner prescribed or are to be in duplicate original form;

(j) prescribing the matters in respect of which fees are payable and the tariff of those fees;

(k) prescribing the rate of the annual duty payable by companies and the additional fees payable for late payment of annual duty or payment of an amount less than the prescribed annual duty;

(1) providing for a table of fees, subject to taxation by the Master, which are payable to a liquidator as remuneration;

(m) prescribing a tariff of remuneration payable to any person performing on behalf of a liquidator any act relating to the winding-up of a company, and prohibiting the charging or recovery of remuneration at a higher tariff than the tariff so prescribed;

(n) as to any matter required or permitted by this Act to be prescribed by regulation; and

(0) generally, as to any matter which the Minister considers necessary or expedient to prescribe in order that the purposes ofthis Act may be achieved.

(2) Any regulations made under subsection (1) may prescribe penalties for any contravention thereof or failure to comply therewith not exceeding a fine ofN$2 000 or imprisonment for a period not exceeding six months or both that fine and imprisonment.

24 Government Gazette 30 December 2004 No.3362 Act No. 28, 2004 COMPANIES ACT, 2004

Prohibition of disclosure of, and exemption from obligation to disclose, certain information

14. (1) The Minister may -

(a) by notice in writing prohibit any company from disclosing, or from stating on or in any document of the company;

(b) on the written application of a company to the Registrar, exempt it, subject to any conditions or restrictions which the Minister may impose, from the obligation to disclose, or to state on or in any of its documents,

particular information or a particular fact concerning the affairs or business of the company, or that of any of its subsidiaries, which the company would otherwise be required under this Act to disclose or to state on or in any document.

(2) Notwithstanding subsection (1) any company must, if the Registrar in a particular case in writing requires the company to do so, submit to the Registrar information which the company would otherwise have been required to submit to the Registrar in terms of this Act.

(3) The Minister must, when considering whether to impose a prohibition or grant an exemption under subsection (1), have regard to the right of the members of the company and of other persons to be informed of the state of affairs and the business and of the profit or loss of the company or of the company and its subsidiaries.

(4) Any company which contravenes a prohibition imposed under subsection (1)( a) and any director or officer of a company who contravenes that prohibition, commits an offence and is liable to a fine which does not exceed N$4 000 or to be imprisoned for a period which does not exceed one year or to both the fine and imprisonment.

(5) For the purposes of this section a company includes an external company.

Notices amending or adding to Schedules

15. (1) The Minister may by notice in the Gazette amend or add to the Schedules to this Act.

(2) Any notice referred to in subsection (1) may prescribe different provisions in respect of different types of companies.

(3) A notice referred to in subsection (1) amending or adding to -

(a) Table A or B contained in Schedule 1 does not apply in relation to any company in respect of which the Table in question applied immediately before the date on which the notice took effect;

(b) Schedule 4 does not apply in respect of any financial year of any company which ended before that date.

Part 4 Standing Advisory Committee

Establishment of Standing Advisory Committee

16. (1) There is established a committee, to be known as the Standing Advisory Committee which consists of five members, appointed by the Minister, of whom -

No.3362 Government Gazette 30 December 2004 25 Act No. 28, 2004 COMPANIES ACT, 2004

(a) one must be a judge, retired judge or legal practitioner with specialised knowledge of corporate law and nominated by the Law Society of Namibia;

(b) one must be an academic involved in corporate law at a tertiary institution appointed by the Minister in consultation with the Minister responsible for Higher Education;

(c) one must be a chartered accountant nominated by an association which represents chartered accountants in Namibia; and

(d) two must be persons whom the Minister reasonably believes will be useful to the SAC.

(2) Notwithstanding subsection (1), a person is not eligible for appointment to the SAC ifhe or she -

(a) is an unrehabilitated insolvent;

(b) has been convicted of an offence of which dishonesty is an element and sentenced to imprisonment without the option of a fine; or

(c) is considered a mentally ill person under the Mental Health Act, 1973 (Act No. 18 of1973).

Functions and powers of SAC

17. (1) The functions of the SAC are to-

(a) make recommendations to the Minister with regard to any amendments to this Act which appears to it to be appropriate;

(b) advise the Minister on any matter referred to it by the Minister;

(c) consult or cooperate with any similar body or institution involved in corporate law development with a view to developing corporate law in Namibia; and

(d) make recommendations to the Minister responsible for Higher Education with regard to the establishment of a research component at a tertiary institution in Namibia.

(2) The SAC has power to -

(a) call to its assistance any persons whom or bodies which it considers necessary to investigate matters relating to corporate law;

(b) enter into an agreement with any person, including the State, a university, a research institution or any other person or body for the performance of any specific act or function or the rendering of specific services;

(c) enter into any other contract and agreement for a legitimate purpose.

(2) The SAC may establish subcommittees consisting of its members or other persons to assist the SAC in the performance of its functions and exercise of its powers under this Act.

Tenure of office

18. (1) Subject to subsection (2), a member of the SAC holds office for a period of three years, but a member is eligible for re-appointment at the end of his or her term of office.

26 Government Gazette 30 December 2004 No.3362 Act No. 28, 2004 COMPANIES ACT, 2004

(2) A member of the SAC vacates office ifhe or she-

(a) ceases to hold the office by virtue of which he or she became a member or is no longer a member of the association or institution by virtue of which he or she became a member;

(b) has, without reasonable excuse, absented himself or herself from three consecutive meetings of the SAC;

(c) in writing, resigns from office; or

(d) becomes subject to a disqualification referred to in section 16(2).

(3) Notwithstanding subsection (1), the Minister may, after affording a member an opportunity to make representations on the matter, remove a member from office if the Minister has reasonable cause to believe that the member is no longer fit or able to discharge the functions of his or her office.

(4) If a member of the SAC vacates office under the circumstances referred to in subsection (2) or (3) or dies, the vacancy must be filled by the Minister in accordance with section 16(1).

(5) A member who is appointed under subsection (4) holds office for the remainder of the period for which his or her predecessor was entitled to hold office.

Administration, finance and procedures of the SAC

19. (1) The Registrar is the secretary of the SAC and the administrative work of the SAC must be done by staff members of the Ministry who are made available for that purpose by the Permanent Secretary ofthe Ministry responsible for Trade and Industry.

(2) A member of the SAC or a person who has done work which is required to be done under this Act is entitled to be paid allowances or to be reimbursed for expenses incurred whilst doing that work, but no allowances are payable and no expenses will be reimbursed to a member or person who is entitled to be or has been compensated for doing that work by the State or by any other person or institution.

(3) The allowances or expenses payable or reimbursable under subsection (2) must be determined by the Minister after consulting the Minister responsible for Finance and those allowances or expenses must be paid out from money appropriated for that purpose by Parliament.

(4) The Minister must appoint one of the members of the SAC to be the first chairperson of the SAC and the members must elect a vice-chairperson from amongst themselves.

(5) Subsequent chairpersons of the SAC must be elected by members of the SAC from amongst themselves.

(6) The chairperson or in his or her absence, the vice-chairperson, must, in consultation with the other members of the SAC, determine the times and places at which meetings of the SAC are to be held but at least one meeting of the SAC must be held during each calendar year.

(7) Two members of the SAC may, in writing, request the chairperson to convene a meeting of the SAC and if a meeting is not convened within 30 days after that request, at least one member of the SAC may, in writing, request the Minister to convene a meeting of the SAC.

(8) The quorum for a meeting of the SAC is three members.

No.3362 Government Gazette 30 December 2004 27 Act No. 28, 2004 COMPANIES ACT, 2004

(9) The chairperson ofthe SAC must preside at meetings of the SAC and ifhe or she is absent from a meeting, the vice-chairperson must preside and ifboth are absent, the members who are present must elect one of those present to preside over the meeting.

(10) The decision of the majority of the members present at a meeting of the SAC is the decision of the SAC, and in the event of an equality of votes, the person presiding at the meeting has a casting vote in addition to his or her ordinary vote.

(11) Where a member of the SAC or a spouse, partner or business associate of the member has a direct or indirect financial interest in a matter which involves the SAC, the member must, at or before the meeting where the matter is to be discussed, advise the SAC of the nature and extent of the financial interest, and thereafter the SAC must determine whether or not the member can participate in discussions relating to that particular matter.

(12) The SAC must cause minutes of its proceedings to be recorded.

(13) The SAC or a committee appointed under section 16(2) may invite any person who is not a member of the SAC to participate in proceedings of the SAC or a committee of the SAC but that person has no right to vote at the proceedings.

(14) The Registrar may attend meetings of the SAC by virtue of his or her office but he or she is not entitled to vote on any matter which is before the SAC.

(15) The SAC may make rules governing the manner in which meetings are to be held and the procedure to be followed at a meeting.

(16) The SAC must, within three months after the end of each calendar year, submit to the Minister, an annual report on its activities and any matter which it has dealt with during that year.

CHAPTER 3 TYPES AND FORMS OF COMPANIES, CONVERSIONS AND LIMITATIONS

ON PARTNERSHIPS AND ASSOCIATIONS

Part 1 Types of Companies

Companies having share capital and companies not having share capital

20. (1) Two types of companies may be formed and incorporated under this Act, namely -

(a) a company having a share capital; or

(b) a company not having a share capital and having the liability of its members limited by the memorandum (in this Act called "a company limited by guarantee").

(2) A company having a share capital may be either a public company or a private company having shares of par value or shares of no par value.

(3) All companies limited by guarantee, including existing companies, are deemed to be public companies for the purposes of this Act.

Non-profit associations

21. (1) Any association -

(a) formed or to be formed for any lawful purpose;

28 Government Gazette 30 December 2004 No.3362 Act No. 28, 2004 COMPANIES ACT, 2004

(b) having as its object the promotion of religion, arts, sciences, education, charity, recreation, or any other cultural or social activity or communal or group interests;

(c) which intends to apply its profits, if any, or other income in promoting its object;

(d) which prohibits the payment of any dividend to its members; and

(e) which complies with the requirements of this section in respect to its formation and registration,

may be incorporated as a company limited by guarantee.

(2) The memorandum of an association referred to in subsection (1) must comply with the requirements ofthis Act and must, in addition, contain the following provisions -

(a) the income and property of the association however derived must be applied solely towards the promotion of its object, and no portion must be paid or transferred, directly or indirectly, by way of dividend, bonus, or otherwise, to the members of the association or to its holding company or subsidiary, but nothing contained in the memorandum prevents the payment in good faith of reasonable remuneration to any officer or employee ofthe association or to any member in return for any services actually rendered to the association;

(b) on its winding-up, deregistration or dissolution the assets of the association remaining after the satisfaction of all its liabilities must be given or transferred to some other association or institution or associations or institutions having objects similar to its object, to be determined by the members of the association at or before the time of its dissolution or, failing that determination, by the Court.

(3) Sections 55(1)(c) and 182 do not apply to an association referred to in subsection (1).

(4) Existing associations incorporated under section 21 ofthe repealed Act are deemed to have been formed and incorporated under this section.

Meaning of "private company" and cessation of its privileges

22. (1) In this Act the expression "private company" means a company having a share capital and which by its articles -

(a) restricts the right to transfer its shares;

(b) limits the number of its members, other than persons who are in the employment of the company and of persons who having been formerly in the employment of the company were, while in that employment, and have continued after the termination of that employment to be, members of the company, to 50; and

(c) prohibits any offer to the public for the subscription of any shares or debentures of the company.

(2) Where two or more persons hold one or more shares of a company jointly they must, for the purposes of this section, be treated as a single member.

No.3362 Government Gazette 30 December 2004 29 Act No. 28, 2004 COMPANIES ACT, 2004

(3) A private company must not alter its articles in such manner that they no longer include all of the provisions referred to in subsection (1) unless it is at the same time converted into a public company.

(4) If a private company fails to comply with its articles referred to in subsection (1), it immediately becomes subject to sections 306(5), 310 and 311 (1) as if it were a public company, but, the Court, on being satisfied that the failure to comply with the articles was unintentional or due to some other sufficient cause, or that on other grounds it is just and equitable to grant relief, may, on the application ofthe company or any other person interested and on appropriate terms and conditions, order that the company be relieved of those obligations which apply to a public company.

Incorporation of certain branches of foreign companies and non-profit associations

23. (1) Notwithstanding anything to the contrary contained in this Act, a branch, established in Namibia, of a company or other association of persons, incorporated outside Namibia, or an association of persons which is not incorporated and has its head office in a foreign country may be incorporated under section 21 if -

(a) the object in Namibia of that branch corresponds with the object of the company or association concerned;

(b) that branch complies with the requirements of section 21; and

(c) the whole of the business and all the property, rights and obligations in Namibia of the company or association concerned will, on incorporation under section 25, be transferred in due form to vest in and be binding on the company so incorporated.

(2) Notwithstanding anything to the contrary in any law -

(a) no transfer or stamp duty is payable in respect of the transfer of property contemplated in subsection (1)( c); and

(b) any licence, exemption, permit, certificate or authority held in terms of any law by the company or association concerned in respect of its business or property in Namibia will, with effect from the date of incorporation of the branch concerned as a company because of subsection (1), for the purposes of that law be deemed to be held by the company so incorporated in respect of that business or property.

(3) This Act in so far as it relates to external companies does not apply in the case of an external company a branch of which has been incorporated as a company by virtue of subsection (1).

Part 2 Conversion of Companies

Conversion of public company, having share capital into private company, and vice versa

24. (1) With the sanction of a special resolution and on compliance with the requirements of sections 22 and 28 and with the other requirements of this Act in respect of private companies, a public company having a share capital may convert itself into a private company having a share capital.

(2) With the sanction of a special resolution and on compliance with the other requirements of this Act in respect of public companies, a private company having a share capital may convert itself into a public company having a share capital.

30 Government Gazette 30 December 2004 No.3362 Act No. 28, 2004 COMPANIES ACT, 2004

Conversion of company into incorporated non-profit association or company limited by guarantee

25. With the sanction of a special resolution and on compliance with the requirements of section 28 and the other requirements of this Act in respect of non-profit associations and companies limited by guarantee, any company may convert itself into a non-profit association under section 21 or into a company limited by guarantee, except that a company having a share capital may only so convert itself if its share capital is cancelled.

Conversion of company limited by guarantee into company having share capital

26. With the sanction of a special resolution and on compliance with the requirements of section 28 and the other requirements of this Act in respect of companies having a share capital, a company limited by guarantee, excluding a non-profit association under section 21, but including an existing company limited by guarantee having a share capital, may convert itself into a company having a share capital.

Conversion of unlimited company

27. (1) An unlimited company referred to in section 25(1) of the repealed Act, which still exists at the commencement of this section and which has not been converted as contemplated in section 25(1) of that Act, may with the sanction ofa special resolution and on compliance with section 28 and the other requirements of this Act, convert itself into any type or form of company provided for by this Act, but, that conversion does not affect the liability of its members in respect of any debts, liabilities or obligations incurred or contracts entered into by, with or on behalf of the company before the conversion.

(2) Until the conversion referred to in subsection (1) takes place-

(a) section 25(2) of the repealed Act continues to apply to that unlimited company as if that section has not been repealed; and

(b) the obligation imposed in terms of section 25(3) of that Act, in the case of an unlimited company which is a private company, continues to bind that company as from the date of commencement of this section.

Notice of intended conversion of company

28. (1) Any company intending to convert itself into another type or form of company must, not less than 15 days before the date of the meeting convened for the purpose of passing the required special resolution, give notice in the Gazette of that intention, specifying the particulars of the proposed conversion and the date and place of the meeting.

(2) Subsection (1) does not apply to any private company having a share capital intending to convert itself into a public company having a share capital.

(3) If any company intending to convert itself into another type or form of company is a public company having a share capital, it must, in addition, send the notice referred to in subsection (1) to every creditor of the company by registered post not less than 15 days before the date of the meeting.

Contents and form of articles on conversion

29. When the articles of any company are to be altered for the purpose of converting the company into another type or form of company under section 24, 26 or 27, sections 64(2) and 65 in so far as they relate to the contents and form of articles, do, with the necessary changes, apply to the articles of that company.

No.3362 Government Gazette 30 December 2004 31 Act No. 28, 2004 COMPANIES ACT, 2004

Registration of conversion

30. (1) The Registrar must, on the registration of the special resolution made under this Part and on payment of the prescribed fee and on being satisfied that the requirements of this Act have been complied with, register any conversion in the register of companies and must issue an amended certificate of incorporation, stating the date of the first registration of the company, its former name, the name as altered and the nature of the conversion.

(2) Any conversion referred to in subsection (1) takes effect as from the date of the issue of the amended certificate of incorporation as contemplated in subsection (1).

(3) The Registrar must give notice in the Gazette ofthe conversion of a company into another type or form of company.

Effect of conversion and alteration of other registers

31. (1) The conversion of a company into another type or form of company under this Act does not affect the corporate existence of the company as from the date of its first registration, nor any of its rights, debts, liabilities, obligations incurred or contracts entered into by, with, or on its behalf at any time nor render defective any legal proceedings by or against the company, and any legal proceedings that could have been continued or commenced by or against it before the conversion, may, notwithstanding the conversion, be continued or commenced against the company as converted.

(2) If as a result of the conversion of a company into another type or form of company, any alteration in its name pursuant to the requirements of this Act is necessary, the alteration must not be regarded as a change of name for the purposes of section 50(1).

(3) On the production by a company of an amended certificate of incorporation or a certified copy to any registrar or other officer charged with the maintenance of a register under any law, and on compliance with the requirements of that registrar or officer as to the form of application, if any, and the payment of any fee prescribed by that law, if any, that registrar or other officer must make in his or her register all those alterations which are necessary because of the conversion of the company into another type or form of company.

Part 3 Conversion of Companies and Close Corporations

Conversion of company into close corporation

32. When a company is converted into a close corporation in terms ofthe Close Corporations Act, 1988 (Act No. 26 of 1988), the Registrar must, simultaneously with the registration of the founding statement of the close corporation by the Registrar of Close Corporations in terms of that Act, cancel the registration of the memorandum and articles of association of the company concerned.

Conversion of close corporation into company

33. (1) A close corporation may, with the written consent of all its members, be converted into a company, as long as every member of the close corporation becomes a member of that company.

(2) A close corporation to be converted into a company as contemplated in subsection (1) may, subject to this section, apply to be incorporated as a company under Chapter 4 of this Act.

(3) If an application referred to in subsection (2) complies with Chapter 4 and subsection (4) -

32 Government Gazette 30 December 2004 No.3362

Act No. 28, 2004 COMPANIES ACT, 2004

(a) the Registrar must register the memorandum and articles in accordance with section 68; and

(b) the Registrar must satisfy himself or herself that simultaneously with that registration, the registration of the founding statement of the close corporation concerned is cancelled in accordance with the Close Corporations Act, 1988 (Act No. 26 of 1988).

(4) An application referred to in subsection (2) must be accompanied by -

(a) a statement of the paid-up share capital, if any, for an amount not greater than the excess of the fair value of the assets to be acquired by the company, over the liabilities to be assumed by the company because of the conversion, but, the company may treat any portion of that excess not reflected as paid-up share capital, as distributable reserves; and

(b) a statement by the close corporation's accounting officer, based on the performance of his or her duties under the Close Corporations Act, 1988, that he or she is not aware of any contravention of the said Act by the close corporation or its members or of any circumstances which may render the members of the close corporation together with the close corporationjointly and severally liable for the corporation's debts.

(5) Where a conversion under this section takes place, the shares or the nominal value of the shares to be held in the company by the members individually, need not necessarily be in proportion to the members' interests as stated in the founding statement of the close corporation concerned.

(6) The Registrar must give notice in the Gazette of the conversion of a close corporation into a company.

Effect of conversion of close corporation into a company

34. (1) On the registration of a company converted from a close corporation, all the assets, liabilities, rights and obligations of the corporation vest in the company.

(2) Any legal proceedings instituted before the registration by or against the close corporation, may be continued by or against the company, and any other thing done by or in respect of the corporation, is deemed to have been done by or in respect of the company.

(3) The juristic person which existed as a close corporation before the conversion must, notwithstanding the conversion, continue to exist as a juristic person but in the form ofa company.

(4) On the production by a company which has been converted from a close corporation of a certificate of incorporation referred to in section 70 to any registrar or other officer charged with the maintenance of a register under any law, and on compliance with the requirements of that registrar or officer as to the form of application and the payment of any required fee, that registrar or other officer must make in his or her register all those alterations as are necessary because of the change effected by the conversion of the close corporation into a company.

(5) No transfer or stamp duty is payable in respect of alterations made in a register under subsection (4).

No.3362 Government Gazette 30 December 2004 33

Act No. 28, 2004 COMPANIES ACT, 2004

Part 4 Limitations on Partnerships and Associations for Gain

Prohibition of associations or partnerships exceeding 20 members and exemption

35. (l) A company, association, syndicate or partnership consisting of more than 20 persons must not be permitted or formed in Namibia for the purpose of carrying on any business that has as its object the acquisition of gain by the company, association, syndicate or partnership, or by its individual members, unless it is registered as a company under this Act, or was formed in terms of the repealed Act or any law which was in existence before the repealed Act.

(2) The Minister may by notice in the Gazette -

(a) exclude any association, syndicate or partnership, formed-

(i) by persons qualified to carry on any organised professions designated by the Minister in that notice;

(ii) for the purpose of carrying on any profession or any combinations of any professions designated by the Minister,

from subsection (1);

(b) include or exclude any other company, association, syndicate or partnership in or from subsection (1).

Unregistered associations carrying on business for gain not corporate bodies

36. No association of persons formed after the commencement of this Act for the purpose of carrying on any business that has for its object the acquisition of gain by the association or by the individual members, is a body corporate, unless it is registered as a company under this Act, or was formed in terms of the repealed Act or any law which was in existence before the repealed Act.

CHAPTER 4 FORMATION, OBJECTS, CAPACITY, POWERS, NAMES, REGISTRATION

AND INCORPORATION OF COMPANIES, INCIDENTAL MATTERS AND DEREGISTRATION

Part 1 Formation, Capacity, Powers and Objects

Mode of forming company

37. Any seven or more persons, where the company to be formed is a public company, or any two or more persons, where the company to be formed is a private company, or anyone person, where the company to be formed is a private company with a single member, may, for any lawful purpose, form a company having a share capital or a company limited by guarantee and secure its incorporation by complying with the requirements of this Act in respect of the registration of the memorandum and articles.

Capacity, powers and objects

38. (1) Subject to this section a company has the capacity and powers of a natural person of full capacity in so far as a juristic person is capable of having that capacity or of exercising those powers.

(2) The memorandum of a company -

34 Government Gazette 30 December 2004 No.3362

Act No. 28, 2004 COMPANIES ACT, 2004

(a) may state the objects ofa company;

(b) must state the objects of the company where it is so required by this Act or any other law,

but, where the objects of a company, or where any exclusion or qualification in terms of section 39 with regard to the objects or powers of the company, including an existing company, is stated, it only serves to restrict the capacity and powers of the company internally as between the company, its direetors and its members, unless a person dealing with the company had actual knowledge or ought reasonably to have known of that statement of the objects of the company or of any exclusion or qualification in tenns of section 39 with regard to the objects or powers of the eompany stated in the eompany's memorandum.

(3) A non-profit association incorporated under section 21 must state its object in its memorandum as provided in subsection (I )(b) of that section.

(4) Subject to subsections (2)(b) and (3), any existing company may at any time after the commencement of this Act, in accordance with section 62(4), by resolution alter its memorandum in order to remove any objects stated in its memorandum and that alteration becomes effective on the date of registration of the resolution.

(5) Subsection (2) must not be construed as in any way limiting the right of a company to-

(a) claim damages from a director, officer or agent of the company for a transaction concluded; or

(b) obtain a restraining order against a director, officer or agent from entering into a proposed transaction;

where that transaction falls outside the objects or the powers of the company.

Ancillary objects and powers of company

39. (I) Where the objects of a company are stated in its memorandum, there must be included in those objects unlimited objects ancillary to those stated objects except those specific ancillary objects which are expressly excluded in its memorandum.

(2) Subject to any limitation imposed by this Act, a company referred to in subsection (1) has plenary powers, including the common powers stated in Schedule 2 to this Act, to enable it to realise its objects and aneillary objects, except those specific powers which are expressly excluded or qualified in its memorandum.

Dealings between company and other persons

40. A company or a guarantor of an obligation of a company may not assert against a person dealing with the company or with a person who has acquired any property, rights or interests from the company that -

(a) a person named as a director of the company in the most recent return lodged with the Registrar under section 224 -

(i) is not a director of the company;

(ii) has not been duly appointed; or

(iii) does not have authority to exercise a power which a director of a company carrying on business of the kind carried on by the company customarily has authority to exercise;

No.3362 Government Gazette 30 December 2004 35 Act No. 28, 2004 COMPANIES ACT, 2004

(b) a person held out by the company as a director, officer or agcnt of the company -

(i) has not been duly appointed; or

(ii) does not have authority to exercise a power which a director, officer or agent of a company carrying on business of the kind carried on by the company customarily has authority to exercise;

(c) a person held out by the company as a director, officer or agent of the company with authority to exercise a power which a director, officer or agent of a company carrying on business of the kind carried on by the company does not customarily have authority to exercise, does not have authority to exercise that power;

\_-

(d) a document issued on behalf of a company by a director, an officer or agent of the company with actual or usual authority to issue the document is not valid or genuine,

unless that person has, or ought reasonably to have, by virtue of his or her position with or relationship to the company, knowledge of the matters referred to in paragraphs (a), (b), (c) or (d), as the case may be.

No constructive knowledge

41. A person is not affected by, or deemed to have notice or knowledge of the contents of, the memorandum or articles of, or any other document relating to a company, merely because the memorandum, articles or other document -

(a) is registered by, or lodged with, the Registrar; or

(b) is available for inspection or kept at the registered office of a company in accordance with this Act.

Power as to pre-incorporation contracts

42. Any contract made in writing by a person professing to act as agent or trustee for a company not yet incorporated is capable of being ratified or adopted by or otherwise made binding upon and enforceable by that company after it has been duly incorporated as if it had been duly incorporated at the time when the contract was made and that contract had been made without its authority, but, the memorandum on its registration, must contain a statement with regard to the ratification or adoption of or the acquisition of rights and obligations in respect of that contract, and that two copies of that contract, one of which must be certified by a notary public, have been lodged with the Registrar together with the lodgement for registrati on of the memorandum and articles of the company.

Loans made and security provided by subsidiary

43. (1) For the purposes of this section-

(a) "funds" include money, shares, debentures or any other property;

(b) "loan" includes any credit extended by a company, if the debt concerned is not payable or being paid in accordance with the normal business practice of the company in respect of the payment to it of other debts of the same kind;

(c) "security" includes a guarantee.

36 Government Gazette 30 December 2004 No.3362 Act No. 28, 2004 COMPANIES ACT, 2004

(2) If -

(a) any funds of a company were employed directly or indirectly, whether through the instrumentality of its subsidiary or otherwise, in a loan to any company which is its holding company or which is a subsidiary of that holding company but not a subsidiary of itself; or

(b) a company directly or indirectly, whether through the instrumentality of its subsidiary or otherwise, provided any security to another person in connection with an obligation of any company which is its holding company or which is a subsidiary of that holding company but not a subsidiary of itself,

particulars of that loan or security, as the case may be, must be stated in the annual financial statements of the company for every year during which that loan or security was in operation.

(3) Subsection (2) does not apply in respect of loans made or security provided in good faith in the ordinary course of the business of a company actually and regularly carrying on a business a substantial part of which is the making ofloans or the provision of security, as the case may be.

(4) Any director or officer of a company who fails to take all reasonable steps to secure compliance with subsection (2) commits an offence and is liable to a fine which does not exceed N$8 000 or to be imprisoned for a period which does not exceed two years or to both the fine and imprisonment.

(5) In any prosecution against any director or officer of a company under subsection (4), the defence referred to in section 292(5) is, with the necessary changes, available to him or her.

(6) Any director or officer of a company who authorises or permits or is a party to the making of any loan or the provision of any security contemplated in subsection (2)( a), is liable to the company for any damage directly arising from the making of that loan or the provision of that security on terms or conditions which, at the time of the making of that loan or the provision of that security, were not fair to the company or failed to provide reasonable protection for its business interests.

(7) A director or officer who has paid any amount as damages by virtue of subsection (6) may recover that part of that amount as the Court considers equitable, from any other director or officer who is in terms of that subsection also liable to the company for the same damage.

(8) For the purposes of subsections (6) and (7), "director or officer" of a company includes any director or officer of a holding company of that company, and for the purposes of recovery of the damages as are contemplated in subsection (6) sections 274, 275 and 276 do, with the necessary changes, apply as if a director or officer or past director or officer of that holding company was a director or officer or past director or officer of that company, respectively.

J

(9) In enquiring, for the purposes of subsection (6), whether or not any terms or conditions were fair to the company or failed to provide reasonable protection for its business interests, regard must be had, without prejudice to the generality of the enquiry, to -

(a) whether, in view of the financial position of the parties, the loan should have been made or the security should have been provided at all;

(b) in the case of a loan, whether security has been or should in the circumstances have been provided, and whether any security provided is adequate;

No.3362 Government Gazette 30 December 2004 37 Act No. 28, 2004 COMPANIES ACT, 2004

(c) the consideration for the loan or security, including any interest or other benefit received;

(d) the term of the loan or security; and

(e) the manner of repayment of the loan or discharge of the security.

(10) This section does not derogate from any other rule of law relating to the liability of a director or officer of a company.

(11) This section does not apply to anything done by a company with the consent of all its members.

No financial assistance to purchase shares of company or holding company

44. (1) A company must not give, whether directly or indirectly, and whether by means of a loan, guarantee, the provision of security or otherwise, any financial assistance for the purpose of or in connection with a purchase or subscription made or to be made by any person of or for any shares of the company, or where the company is a subsidiary company, of its holding company.

(2) Subsection (1) must not be construed as prohibiting-

(a) the lending of money in the ordinary course of its business by a company whose main business is the lending of money;

(b) the provision by a company, in accordance with any scheme for the time being in force, of money for the subscription for or purchase of shares of the company or its holding company by trustees to be held by or for the benefit of employees of the company, including any director holding a salaried employment or office in the company; or

(c) the making by a company of loans to persons, other than directors, in the employment of the company with a view to enabling those persons to purchase or subscribe for shares of the company or its holding company to be held by themselves as owners; or

(d) the provision of financial assistance for the acquisition of shares in a company or its holding company -

(i) with the prior approval of the particular transaction given by special resolution at a general meeting; and

(ii) if there are reasonable grounds for believing that -

(aa) the company is, or would after payment be, able to pay its debts as they become due in the ordinary course of business; or

(bb) the consolidated assets of the company fairly valued would after the payment be more than the consolidated liabilities of the company.

(3) Any company which and every director or officer of that company who contravenes subsection (1), commits an offence and is liable to a fine which does not exceed N$4 000 or to be imprisoned for a period which does not exceed one year or to both the fine and imprisonment.

38 Government Gazette 30 December 2004 No.3362

Act No. 28, 2004 COMPANIES ACT, 2004

(4) For the purpose of subsection (3) "director", in relation to a company, includes any person who at the time of the alleged contravention was a director of the company.

(5) It is a defence in any proceedings under this section against any director or officer of a company if it is proved that the accused was not a party to the contravention.

Company not to be member of its holding company

45. (1) Save as is provided in subsection (2), if shares in a company are acquired in accordance with section 95 by its subsidiary, for so long as those shares are held by the subsidiary -

(a) no voting rights attaching to those shares may be exercised; and

(b) the votes able to be cast at any meeting of shareholders must be reduced by the votes in respect of shares held by the subsidiary,

but this subsection does not apply where the shares are acquired in a subsidiary of the holding company which is also a subsidiary of the acquiring company.

(2) Subsection (l) does not apply in relation to a subsidiary acting in a representative capacity or as a trustee, unless the holding company or its subsidiary 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.

(3) In relation to a company limited by guarantee which is a holding company, the reference in this section to shares of a company, must be construed as including a reference to the interest of its members as such, whatever the form of that interest.

(4) For the purposes of this section "acquire" includes any shares that the subsidiary becomes entitled to in any other manner.

No division into interests, rights to profits or shares in guarantee companies

46. (1) In the case of a company limited by guarantee, every provision in the memorandum or articles or in any resolution of the company purporting to give any person a right to participate in the divisible profits of the company otherwise than as a member is void.

(2) Any provision in the memorandum or articles or in any resolution of a company limited by guarantee, purporting to divide the undertaking ofthe company into shares or interests is void.

Part 2 Names of Companies

Names of companies not to be undesirable

47. The Registrar must not register a memorandum containing a name for a company to be incorporated if the Registrar reasonably believes that the name is undesirable.

Reservation of name

48. (1) The Registrar may, on written application on the prescribed form and on payment of the prescribed fee, reserve a name or a shortened form of the name of a

No.3362 Government Gazette 30 December 2004 39 Act No. 28, 2004 COMPANIES ACT, 2004

company, pending the registration of a memorandum or a change of name by that company or the registration of a shortened form of the name.

(2) If the name of a company or a shortened form thereofis in a language other than the official language, a translation of the name in the official language, in so far as it is possible, must be submitted to the Registrar together with the application referred to in subsection (1).

(3) A reservation referred to in subsection (1) is for a period not exceeding two months or any extended period, not exceeding in all three months, which the Registrar, on payment of the prescribed fee, may in the special circumstances of any case allow.

Registration of shortened form of name or defensive name

49. (1) The memorandum of any company to be incorporated may contain one shortened form of the company's name, and any company may, on the prescribed form and on payment of the prescribed fee, apply to the Registrar for the registration of that shortened form of its name, if the shortened form of the name is not undesirable.

(2) Any person may on application on the prescribed form and on payment of the prescribed fee apply to the Registrar -

(a) to register any name as a defensive name; or

(b) to renew the registration of a name as a defensive name,

which the Registrar reasonably believes is not undesirable and in respect of which that person has furnished proof, to the satisfaction of the Registrar, that he or she has a direct and material interest.

(3) lfthe defensive name referred to in subsection (2) is in a language other than the official language, a translation in the official language, in so far as it is possible, must be submitted to the Registrar together with the application referred to in that subsection.

(4) If the Registrar grants any application referred to in subsection (2), he or she must register the name in question as a defensive name for a period not exceeding two years or renew the registration of the name in question as a defensive name for a period not exceeding two years, as the case may be.

(5) The Registrar must register a shortened form of the name of the company concerned or a defensive name, and where a registration is effected pursuant to an application under subsection (1) or (2), the Registrar must give notice of the registration in the Gazette.

Change of name and effect

50. (1) Any company may by special resolution change its name to a name which the Registrar reasonably believes not to be undesirable.

(2) Where a company changes its name, it must at the same time, if a shortened form of the name of the company has been registered under section 49(5), and that shortened form is no longer applicable to the name of the company as changed, apply on the prescribed form and on payment of the prescribed fee -

(a) to change that shortened form of the name to a new shortened form of the name approved by the Registrar; or

40 Government Gazette 30 December 2004 No.3362

Act No. 28, 2004 COMPANIES ACT, 2004

(b) to deregister that former shortened form of the name of the company.

(3) Where the name or shortened form of the name of a company is changed-

(a) the company must, if that changed name is not in the official language, submit to the Registrar, in so far as it is possible, a translation of the name in the official language; and

(b) the Registrar must -

(i) enter the new name or shortened form of the name in the register in place of the former name or shortened form of the name;

(ii) issue a certificate of incorporation altered to meet the circumstances of the case or a certificate that the new name or shortened form ofthe name, has been entered in the register in place of the former name or shortened form of the name; and

(iii) give notice of the change of name or shortened form of the name in the Gazette.

(4) A change of name of a company does not affect any rights, debts, liabilities or obligations of the company, nor render defective any legal proceedings by or against the company, and any legal proceedings that could have been continued or commenced by or against it prior to that change of name, may, notwithstanding that change of name, be continued or commence by or against the company under its new name.

(5) On the production by a company of an amended certificate of incorporation or a certificate of the change of the name of that company or a certified copy to any registrar or other officer charged with the maintenance of a register under any law, and on compliance with the requirements of that registrar or officer as to the form of application, if any, and the payment of any fee prescribed by that law, if any, that registrar or other officer must make in his or her register all alterations which are necessitated by the change of the name ofthe company.

Order to change name

51. (1) If within a period of one year after the registration of any memorandum or shortened form of a name of a company or after the registration or the renewal of the registration of a name referred to in section 49(2) or after the date of an amended certificate of incorporation or a certificate of change of name or shortened form of a name referred to in section 50(2), it appears that the name contained in the memorandum or shortened form of that name or the name referred to in section 49(2) or the changed name or the shortened form of that changed name referred to in the last-mentioned certificate is undesirable, the Registrar must within that period order the company concerned or the person referred to in section 49(2) to change the name or shortened form of the name.

(2) If within a period of one year after the registration of any memorandum or shortened form of a name of a company or a name referred to in section 49(2) or after the date of an amended certificate of incorporation or a certificate of change of name or shortened form of a name referred to in section 50(2), any person lodges an objection in writing with the Registrar against the name contained in the memorandum or shortened form of that name or the name referred to in section 49(2) or the changed name or the shortened form of that changed name referred to in the last-mentioned certificate, on the grounds that that name or shortened form of a name is calculated to cause damage to the objector or is undesirable, the Registrar may, ifhe or she is satisfied that the objection is sound, order the company concerned or the person referred to in section 49(2) to change the said name or shortened form of a name.

No.3362 Government Gazette 30 December 2004 41 Act No. 28, 2004 COMPANIES ACT, 2004

(3) Within a period of two years after the registration of any memorandum or shortened form of a name of a company or a name referred to in section 49(2) or after the date of an amended certificate of incorporation or a certificate of change of name or shortened form of a name referred to in section 50(2), a person who has not lodged any relevant objection in terms of subsection (2) may apply to the Court for an order directing the company concerned or the person referred to in section 49(2) to change the said name or shortened form on the grounds that the said name or shortened form is undesirable or is calculated to cause damage to the applicant, and the Court may on that application make an appropriate order.

(4) If, at any time, the Registrar reasonably believes that the name of a company, or the shortened form of a name of a company, gives so misleading an indication of the nature of its activities as to be calculated to deceive the public, the Registrar may order the company concerned to change its name or the shortened form of its name, as the case maybe.

Provisions as to order to change name

52. (1) The order issued by the Registrar under section 51, including the reasons for that an order, for the change of a name of a company or a shortened form of a name of a company or a name referred to in section 49(2) must be issued by the Registrar in writing and sent by registered post to the company at its registered office, or to the person referred to in section 49(2) at that person's last-known address, and must require that company or person -

(a) to comply with the order within two months from the date of its issue; or

(b) to give reasons within two months from the date of its issue to the Registrar as to why that name or shortened form of a name of a company should not be changed.

(2) The Registrar may, on good cause shown, extend the period of two months referred to in subsection (1) for any further period not exceeding two months.

(3) If a company or a person has submitted reasons as to why the name or shortened form of a name of a company should not be changed, the Registrar may, after consideration of those reasons, either withdraw that order or make a final order and subsections (1)(a) and (2) do, with the necessary changes, apply with regard to that final order.

(4) If a company or person referred to in subsection (1), as the case may be, fails to comply with any order issued by the Registrar under subsection (1) or (3) within the period or extended period referred to in subsection (1) or (2), as the case may be, or if that company or person has applied to Court for relief under section 54 and the Court has upheld the Registrar's order and that company or person fails to comply with that order within two months from the date ofthe final decision by the Court, that company or person commits an offence and is liable to a fine which does not exceed N$40 for every day during which the contravention continues.

Registrar may call for affidavits and shall give reasons for decisions as to names

53. (1) The Registrar may for the purposes of any decision as to any name or shortened form of a name referred to in section 47, 48, 49, 50 or 51 call for any evidence on affidavit or otherwise which is necessary.

(2) The Registrar must with regard to any decision or order of the Registrar under section 47, 48, 49 or 50 furnish written reasons for that decision or order.

42 Government Gazette 30 December 2004 No.3362

Act No. 28, 2004 COMPANIES ACT, 2004

Recourse to Court in matters as to names

54. Any company or person aggrieved by any decision or order of the Registrar under section 47,48,49, 50 or 51 may, within one month after the date of thatdecision or order, apply to the Court for relief, and the Court has power to consider the merits of that matter, to receive further evidence and to make any appropriate order.

Formal requirements as to names of companies

55. (1) Subject to this section -

(a) the name of a public company having a share capital must include, as its last word, the word "Limited";

(b) the name of a private company having a share capital must include as its last two words, the words "(Proprietary) Limited";

(c) the name of a company limited by guarantee must include -

(i) the word "Limited" as its last word; and

(ii) the statement "(Limited by Guarantee)" subjoined to that name.

(2) There must be included in the name of any external company, the memorandum of which has been registered under this Act, the statement "Incorporated in ... (stating the name of the foreign country concerned)" subjoined to that name.

(3) The name of a non-profit association incorporated under this Act must not include the word and statement referred to in subsection (l)(c), but the statement "Non- profit association incorporated under section 21" must be included in and be subjoined to that name, but an association incorporated not for gain under the repealed Act may instead of that statement include in and subjoin to its name the statement "Incorporated Association not for Gain".

(4) The name of a private company having a share capital and the memorandum of which contains the provision referred to in section 60(b), must not include the words referred to in subsection (1)(b), but must include the word "Incorporated", as its last word, in its name.

(5) If a company is being wound up by the Court or voluntarily or is placed under judicial management, the statement "In Liquidation", "In Voluntary Liquidation" or "Under Judicial Management", as the case may be, must be included in and be subjoined to the name ofthe company concerned and if the winding-up order or judicial management order is discharged, or the voluntary winding-up ceases, that statement must be omitted from the name of that company.

(6) The addition to or omission from the name of any company of the words or statements provided for by this section as a result of -

(a) the conversion of a company into another type or form of company;

(b) the insertion in or deletion from the memorandum of a private company of the provision referred to in section 60(b); or

(c) the discharge of a winding-up order or judicial management order or the cessation of voluntary winding-up,

must not be taken to be a change of name for the purposes of section 50(1), except that subsections (2), (3) and (4) of that section apply in the case of that addition or omission

- . "

No.3362 Government Gazette 30 December 2004 43

Act No. 28, 2004 COMPANIES ACT, 2004

(7) If a company is being wound up by the Court, or voluntarily, or is placed under judicial management, the Registrar must, on receipt of a copy of the relevant order of Court or on registration of a special resolution for the voluntary winding-up of the company in terms of section 354, alter the register to include in and subjoin to the name of the company concerned the statement "In Liquidation", "In Voluntary Liquidation" or "Under Judicial Management", as the case may be, and if the winding-up order or judicial management order is discharged, or the winding-up ceases, the Registrar must likewise on receipt of a copy ofthe relevant order of Court, alter the register to omit that statement from the name of the company concerned.

(8) Ifany company fails to comply with subsection (1), (2), (3), (4), (5) or (6) or in any way uses a name in contravention of any of those provisions, it commits an offence and is liable to a fine which does not exceed N$400.

Use and publication of name by company

56. (1) Every company must -

(a) display its name on the outside of its registered office and every office or place in which its business is carried on, in a conspicuous position and in characters easily legible;

(b) have its name engraved in legible characters on its seal; and

(c) have its name and registration number mentioned in legible characters in all notices and other official publications of the company and in all bills of exchange, promissory notes, endorsements, cheques, and orders for money or goods purporting to be signed by or on behalf of the company and in all letters, delivery notes, invoices, receipts, and letters of credit of the company.

(2) For the purposes of subsection (1) -

(a) the abbreviations "Ltd", "Pty", "Inc", "Co" and "&" may be used for the words "Limited", "Proprietary", "Incorporated", "Company" and "and" in a company's name; and

(b) a company must not use the shortened form of its name unless it is used in conjunction with its name.

(3) A director or officer of a company or a person acting on its behalf must not -

(a) use or authorise the use of any seal purporting to be a seal of the company whereon its name is not so engraved as contemplated in subsection (1)(b);

(b) issue or authorise the issue of any notice or other official publication of the company, or sign or authorise to be signed on behalf of the company any bill of exchange, promissory note, endorsement, cheque or order for money or goods, wherein its name is not mentioned in the manner contemplated in subsection (1)( c); or

(c) issue or authorise the issue of any letter, delivery note, invoice, receipt or letter of credit of the company wherein its name is not mentioned in the manner contemplated in subsection (1)(c).

(4) Any director, officer or person referred to in subsection (3) who contravenes that subsection commits an offence and is liable to a fine which does not exceed N$400.

44 Government Gazette 30 December 2004 No.3362 Act No. 28, 2004 COMPANIES ACT, 2004

(5) A director, officer or person referred to in subsection (3) who contravenes that subsection is further liable to the holder of the bill of exchange, promissory note, cheque or order for money or goods for the amount stated on the document if non- compliance with subsection (3) results in default of payment by the company.

(6) A company which contravenes or fails to comply with subsection (1) commits an offence and is liable to a fine which does not exceed N$400.

Improper use of word "Limited" or "Incorporated" an offence

57. Any person trading or carrying on business under a name or title of which the word "Limited" or "Incorporated" is the last word, commits, unless the entity is incorporated under this Act or any other law, an offence and is liable to a fine which does not exceed N$40 for every day during which the contravention continues.

Savings provisions regarding certain existing name registrations

58. Any registration before the date of coming into operation of this Part in terms of a provision of the repealed Act of a name, or a translated name, of an existing company, or any shortened form of the name, in a language other than the official language, or of any name, translated name, or shortened form, of a company, containing a word or expression in the other language, is for the purposes of this Act -

(a) deemed to be proper registration under the corresponding provisions ofthis Act; and

(b) the use of that name, translated name or shortened form or any word or expression contained in that name, translated name or shortened form is deemed to be sufficient compliance with the requirements of sections 55 and 56(2)(a).

Part 3 Memorandum of Association

Requirements for memorandum of association

59. (1) The memorandum of a company must state the purpose, referred to in section 37, for which it is to be formed and incorporated, describing the business which the company is to carry on, or, in the case of a non-profit association, the object it is to promote, and in addition -

(a) the name of the company;

(b) where the company in terms of section 38 elected to state or must state its objects -

(i) the objects of the company, stating the general nature ofthe business which it is contemplated the company will be entitled to carryon;

(ii) the specific ancillary objects, referred to in section 39(1), if any, which are excluded from the unlimited ancillary objects of the company;

(iii) the specific powers or part of any powers of the company, referred to in section 39(2), if any, which are excluded from the plenary powers or the powers set out in Schedule 2.

(2) If the company is to have a share capital, the memorandum must state -

No.3362 Government Gazette 30 December 2004 45 Act No. 28, 2004 COMPANIES ACT, 2004

(a) the amount of the share capital with which it is proposed to be registered and the division of the share capital into shares of a fixed amount;

(b) the number of shares if the company is to have shares of no par value; and

(c) the number of shares which each subscriber undertakes to take up, stated in words opposite his or her name, subj ect to the requirement that no subscriber may take less than one share.

(3) If the company is to be a company limited by guarantee, the memorandum must state-

(a) that the liability of the members is limited to the amount referred to in paragraph (b); and

(b) that each member undertakes to contribute to the assets of the company in the event of its being wound up while a member or within one year afterwards, for payment of the debts and liabilities of the company contracted before he or she ceases to be a member, and of the costs, charges and expenses of the winding-up, and for adjustment of the rights of the contributories among themselves, any amount which may be required, not exceeding a specified amount but not less than one Namibian dollar.

Memorandum may contain special conditions and provide for unlimited liability of directors

60. The memorandum of a company may, in addition to the requirements of section 59 -

(a) contain any special conditions which apply to the company, and the requirements, if any, additional to those provided for in this Act for the alteration of those conditions;

(b) in the case of a private company, provide that the directors and past directors are liable jointly and severally, together with the company, for debts and liabilities of the company which are or were contracted during their periods of office, in which case those directors and past directors are so liable.

Form and signing of memorandum

61. (1) The memorandum must be and be completed in the form prescribed.

(2) The memorandum of a public company must be signed by not less than seven subscribers and of a private company by one or more subscribers, stating their full names, occupations and residential, business and postal addresses, and each subscriber must sign the memorandum in the presence of at least one witness who must attest the signature and state his or her residential, business and postal address.

Part 4 Alteration of Memorandum

Alteration of memorandum as to special conditions and other provisions

62. (1) Subject to subsection (3) and unless prohibited by the condition itself, a special condition contained in the memorandum may be altered by special resolution or in the manner specified in that special condition.

(2) Any private company may at any time by special resolution and with the written consent of each person being then a director of the company, incorporate in its memorandum the provision referred to in section 60(b).

46 Government Gazette 30 December 2004 No.3362

Act No. 28, 2004 COMPANIES ACT, 2004

(3) A private company may by special resolution alter or remove the provision referred to in section 60(b) and contained in its memorandum provided the alteration or removal is confirmed by the Court if it is satisfied that that alteration or removal would be just and equitable.

(4) Any other provision of the memorandum ofa company may be altered by special resolution.

(5) Nothing in this section authorises any alteration of a memorandum constituting a variation or abrogation of the special rights of any class of members, except that those rights may be altered or abrogated in the manner provided for in the memorandum for that variation or abrogation.

Lodgment of altered memorandum

63. (1) The Registrar may, in writing, request any company which has lodged a special resolution altering its memorandum, to lodge, within 14 days after the date of the request, a copy of the memorandum as so altered.

(2) Any company which fails to comply with any request under subsection (1) commits an offence and is liable to a fine which does not exceed N$40 for every day during which the contravention continues.

Part 5 Articles of Association

Companies to have articles

64. (1) There must be registered with the memorandum ofa company, articles of association, prescribing articles for the company.

(2) The articles of a company having a share capital -

(a) if a public company, may consist of the articles contained in Table A of Schedule 1; and

(b) if a private company, may consist of the articles contained in Table B of Schedule 1,

subject to any additions, omissions and modifications which are stated in the articles, and the articles contained in the said Schedule do, so far as applicable and not excluded or modified, apply to that company, but, any condition contained in the articles of a company for compulsory loans to be made by members of the company to the company is invalid.

Form and signing of articles

65. (1) The articles must be and be completed in the form prescribed.

(2) The articles must be signed by each subscriber of the memorandum stating his or her full name, occupation and residential, business and postal address, in the presence of at least one witness who must attest the signature and state his or her residential, business and postal address.

Consolidation of articles

66. A company may at any time after the registration of its articles, submit to the Registrar a document in the prescribed form, containing a consolidated and full statement of all the articles applying to the company and, on payment of the prescribed fee, the Registrar must, if satisfied that the articles of the company have been truly stated

No.3362 Government Gazette 30 December 2004 47 Act No. 28, 2004 COMPANIES ACT, 2004

in the consolidated document, endorse on that document a certificate to the effect that the articles stated therein constitute the articles of the company as at the date of the certificate.

Alteration of articles

67. (1) Subject to the conditions contained in its memorandum, a company may, by special resolution, alter or add to its articles and any alteration or addition so made is as valid as if originally contained therein, and is subject in like manner to alteration by special resolution.

(2) Section 63 which relates to the lodgment of a copy of an altered memorandum does, with the necessary changes, apply to the lodgment of altered articles.

Part 6 Registration, Incorporation and Deregistration

Registration of memorandum and articles

68. (1) If a memorandum and articles complying with the requirements of this Act together with two certified copies are lodged with the Registrar in the manner prescribed, the Registrar must, on payment of the prescribed fee and any other additional prescribed fee, register that memorandum and articles, impress his or her seal on one copy and endorse the date of registration and the certificate provided for in section 70.

(2) Any memorandum and articles lodged for registration must be delivered and uplifted at the Companies Registration Office personally by a subscriber or by a person authorised by the subscriber in writing.

(3) On the registration of the memorandum and articles of a company the Registrar must allocate a registration number to the company concerned.

Memorandum and articles to be in official language

69. (1) The memorandum and articles of a company must be in the official language.

(2) If the memorandum or articles of an existing company is in any language other than the official language, the company must, within two years after the commencement of this Act, by special resolution, substitute that existing memorandum or those articles with a translation in the official language and no fee is payable with regard to that substitution.

Certificate of incorporation and its evidential value

70. (1) On the registration of the memorandum and articles of a company the Registrar must endorse on the memorandum and articles, a certificate signed and sealed by him or her that the company is incorporated.

(2) A certificate of incorporation given by the Registrar in respect of any company is on its mere production, in the absence of proof offraud, conclusive evidence that all the requirements of this Act in respect of registration and of matters precedent and incidental to the registration, have been complied with, and that the company is a company duly incorporated under this Act.

Effect of incorporation on company and members

71. (1) From the date of incorporation stated in the certificate of incorporation, the subscribers of the memorandum together with other persons who may become

48 Government Gazette 30 December 2004 No.3362 Act No. 28, 2004 COMPANIES ACT, 2004

members of the company, become a body corporate with the name stated in the memorandum, capable of exercising all the functions of an incorporated company, and having perpetual succession, but with liability, if any, on the part of the members to contribute to the assets of the company in the event of its being wound up as provided by this Act.

(2) The memorandum and articles bind the company and its members to the same extent as if they respectively had been signed by each member, to observe all the provisions of the memorandum and of the articles, subject to this Act.

Liability of members where membership reduced below minimum

72. If any public company other than a wholly owned subsidiary carries on business for more than six months while it has less than seven members, every person who is a member of the company during the time that it so carries on business after those six months and is cognisant of the fact that it is so carrying on business, is liable for the payment of the whole ofthe debts of the company contracted during that time and may be sued for the same without any other member being joined in the action.

Rights of members to copies of memorandum and articles

73. (1) A company must send to every member at that member's request, at cost or any lesser amount which the company may determine, a copy of its memorandum and of its articles, or must, if so requested, afford to a member or the duly authorised agent of a member adequate facilities for making a copy ofthat memorandum and articles.

(2) Any company which fails to comply with any request under subsection (1), commits an offence and is liable to a fine which does not exceed N$400.

Cancellation of registration of memorandum and articles

74. (1) Ifa company has failed, for a period of more than two years, to lodge with the Registrar an annual return in compliance with section 181, or when the Registrar has reasonable cause to believe that a company is not carrying on business or is not in operation, he or she must, in accordance with subsection (10), send to the company by certified post a letter enquiring whether it is carrying on business or is in operation.

(2) If the Registrar does not within one month after sending the letter receive any answer or receives an answer to the effect that the company is not carrying on business or is not in operation, the Registrar may publish in the Gazette and send to the company by certified post a notice that at the expiry oftwo months from the date ofthat notice that company will, unless good cause is shown to the contrary, be deregistered.

(3) At the expiry ofthe period mentioned in any notice referred to in subsection (2) or on receipt from any company of a written statement signed by every director to the effect that the company has ceased to carry on business and has no assets or liabilities, the Registrar may, unless good cause to the contrary has been shown by the company, deregister the company concerned, and must give notice to that effect in the Gazette and the date of the publication of that notice in the Gazette is deemed to be the date of deregistration.

(4) Notwithstanding the deregistration contemplated in subsection (3), the liability of every director, officer and member of the company continues and may be enforced as if the company had not been deregistered.

(5) The Registrar must cancel the registration of the memorandum and articles of a company which is deregistered under this section.

No.3362 Government Gazette 30 December 2004 49

Act No. 28, 2004 COMPANIES ACT, 2004

(6) When any company has been deregistered the books and papers of the company may be disposed of in any way which the Registrar may direct.

(7) After five years from the deregistration of a company, no responsibility rests on any person to whom the custody of the books and papers has been committed, because of the same not being forthcoming to a person claiming to be interested therein.

(8) The Court may, on application by any interested person or the Registrar, if it is satisfied that a company was at the time of its deregistration carrying on business or was in operation, or otherwise that it is just that the registration of the company be restored, make an order that the registration be restored accordingly, and after which the company is deemed to have continued in existence as if it had not been deregistered.

(9) An order referred to in subsection (8) may contain directions and make provision which the Court considers just for placing the company and all other persons in the position, as nearly as may be, as if the company had not been deregistered.

(10) A letter or notice under this section must be addressed to the company at its registered office, its postal address and to the care of the directors or officers and the auditor of the company or may, if there is no director, officer or auditor of the company whose name and address is known to the Registrar, be sent to each of the persons who signed the memorandum of the company, at the address mentioned in the memorandum.

Part 7 Incidental Matters

Issued copies of memorandum or articles to embody alterations

75. (1) Every copy of the memorandum or articles of a company issued after the date on which any alteration has been made, must include the alteration.

(2) A company which, after the date of any alteration, issues a copy of its memorandum or articles which does not include an alteration commits an offence and is liable to a fine which does not exceed N$400.

Contracts by companies

76. (1) Contracts on behalfofa company may be made as follows-

(a) any contract which if made between individual persons would by law be required to be in writing signed by the parties liable to be sued on that contract may be made on behalf of the company in writing signed by any person acting under its authority, expressed or implied, and may in the same manner be varied or discharged;

(b) any contract which if made between individual persons would by law be valid though made orally only and not reduced to writing, may be made orally on behalf of the company by any person acting under its authority, expressed or implied, and may in the same manner be varied or discharged.

(2) All contracts made in accordance with this section are valid and bind the company and its successors and all other parties.

Promissory notes and bills of exchange

77. A bill of exchange or promissory note is deemed to have been made, accepted or endorsed on behalf of a company if made, accepted or endorsed in the name of or by or on behalf or on account of, the company by any person acting under its authority.

50 Government Gazette 30 December 2004 No.3362 Act No. 28, 2004 COMPANIES ACT, 2004

Service of documents on companies

78. Any notice, order or other document which by this Act may be or is required to be served on any company, including any external company, may be served by delivering it at or sending it by registered post to the registered office or postal address of the company.

Arbitration between companies and others

79. (1) A company may agree to refer and may refer to arbitration any existing or future difference between itself and any other company or person.

(2) Companies which are parties to an arbitration may delegate to the arbitrator power to settle or determine any matter capable of being lawfully settled or determined by the companies themselves or by their directors or other managing body.

CHAPTERS SHARE CAPITAL, ACQUISITION BY COMPANIES OF OWN SHARES,

SHARES, ALLOTMENT AND ISSUE OF SHARES, MEMBERS AND REGISTER OF MEMBERS, DEBENTURES, TRANSFER AND

RESTRICTIONS ON OFFERING SHARES FOR SALE

Part 1 Share Capital

Division of share capital into shares having par value or having no par value

80. The share capital of a company may be divided into shares having a par value or may be constituted by shares having no par value, but, all the ordinary shares or all the preference shares must consist of either the one or the other.

Company may alter share capital and shares

81. (1) Subject to sections 62 and 108 a company having a share capital, if so authorised by its articles, may by special resolution -

(a) increase its share capital by new shares of any amount, or increase the number of its shares having no par value;

(b) increase its share capital constituted by shares of no par value by transferring reserves or profits to the stated capital, with or without a distribution of shares;

(c) consolidate and divide all or any part of its share capital into shares of larger amount than its existing shares or consolidate and reduce the number of the issued no par value shares;

(d) increase the number of its issued no par value shares without an increase of its stated capital;

(e) subdivide its shares, or any of them, into shares of smaller amount than is fixed by the memorandum;

(f) subject to this Act, convert all of its ordinary or preference share capital consisting of shares having a par value into stated capital constituted by shares of no par value, but an existing company must not convert any share capital which is not fully paid up;

No.3362 Government Gazette 30 December 2004 51 Act No. 28, 2004 COMPANIES ACT, 2004

(g) subject to this Act, convert its stated capital constituted either by ordinary or preference shares of no par value into share capital consisting of shares having a par value;

(h) cancel shares which at the time of the passing of the resolution in that regard, have not been taken or agreed to be taken by any person and diminish the amount of its authorised share capital by the amount of the shares so cancelled or may cancel shares of no par value which have not been taken or agreed to be taken; or

(i) convert any of its shares, whether issued or not, into shares of another class.

(2) Where under subsection (1) a company -

(a) increases its share capital by shares of a fixed amount, it must pay to the Registrar the prescribed amount for each N$l 000, or part of it, by which the share capital is increased;

(b) increases the number of its shares of no par value, it must -

(i) lodge with the Registrar, in the prescribed manner, a certificate given by the auditor of the company showing the value of each issued share arrived at by dividing the number of issued shares into the stated capital; and

(ii) pay to the Registrar the prescribed amount for each N$l 000 or part of it calculated by multiplying the number by which the number of the shares has been increased by the value of each share as certified under subparagraph (i).

(3) If, in the case of a company which has converted its share capital under subsection (1)(f) and thereafter passed a special resolution to convert its stated capital as contemplated in subsection (1)(g), shares which at the time ofthe passing of that special resolution have not been taken or agreed to be taken by any person -

(a) are converted as so contemplated, subsection (2)(a) does, with the necessary changes, apply in respect of any amount by which the share capital of the company is increased, which amount is the amount by which the nominal share capital after the conversion under subsection (1)(g) exceeds the nominal share capital before the conversion under subsection (1)(f);

(b) are not converted as so contemplated, those shares must be cancelled, with the necessary changes, in accordance with subsection (l)(h).

Premiums received on issue of shares to be share capital, and limitation on application thereof

82. (1) Where a company which is not a banking institution in terms of the Banking Institutions Act, 1998 (Act No.2 of 1998), issues shares at a premium, whether for cash or otherwise, a sum equal to the aggregate amount or value of the premiums on those shares must be transferred to an account to be called the "share premium account".

(2) Where assets are acquired by the issue of shares of a company and no consideration is recorded, the assets so acquired must be valued and if the value of the assets is more than the par value of those shares, the difference between the par value of the shares and the value of the assets so acquired must be transferred to the share premium account.

52 Government Gazette 30 December 2004 No.3362 Act No. 28, 2004 COMPANIES ACT, 2004

(3) The share premium account may, notwithstanding anything contained in subsection (1), be applied by the company -

(a) in paying up unissued shares of the company to be issued to members of the company as fully paid capitalisation shares;

(b) in writing off -

(i) the preliminary expenses of the company;

(ii) the expenses of, or the commission paid or discount allowed on, the creation or issue of any shares of the company;

(c) in providing for the premium payable on redemption of any redeemable preference shares of the company -

(i) that premium must not be so provided unless it is payable according to the terms of issue of the shares concerned and those terms have been embodied in the articles of the company as from a date prior to the date on which those shares were allotted and issued or on a later date allowed by the Court on application to it;

(ii) in the case of ordinary shares which are converted into redeemable preference shares redeemable at a premium, only that portion of the amount standing to the credit of the share premium account which arose on the original issue of those shares may be applied in providing for the premium payable on redemption; or

(d) for the payment of a premium in the case of any acquisition of shares in accordance with sections 89 to 91, inclusive.

(4) Subsection (3)(c) does not apply in respect of redeem able preference shares issued before the commencement of this Act.

Proceeds of issue of shares of no par value to be stated capital

83. (1) The whole of the proceeds of an issue of shares having no par value is paid-up share capital of a company and must be transferred to an account to be called the "stated capital account".

(2) If shares having no par value are issued by a company for a consideration other than cash, a sum equal to the value of the consideration as determined by the directors must be transferred to the stated capital account.

(3) The stated capital account may, notwithstanding anything contained in subsection (1) or (2), be applied by a company in writing off -

(a) the preliminary expenses of the company; or

(b) the expenses of, or the commission paid on, the creation or issue of those shares.

Effect of conversion of par value share capital into no par value share capital and vice versa

84. (1) Where a company converts all its ordinary or preference shares having a par value, or both the ordinary and preference shares, into shares without par value, there must be transferred to the stated capital account of the company -

No.3362 Government Gazette 30 December 2004 53

Act No. 28, 2004 COMPANIES ACT, 2004

(a) the whole of the ordinary or preference share capital, as the case may be; and

(b) the whole of the share premium account or that part contributed to it by the shares so converted.

(2) Where a company converts all its ordinary or preference shares of no par value or both those ordinary and preference shares into shares having a par value, there must be transferred to the share capital account of the company the whole of the stated capital account or that part contributed to it by the shares so converted.

(3) Fractions, fractional surpluses or amounts arising in respect of the nominal share capital or the stated capital may be rounded off but material reductions must be placed to non-distributable reserves.

Payment of interest out of capital in certain cases

85. (1) Where any shares of a company are issued for the purpose of raising money to defray the expenses of the construction of works or buildings or for the provision of plant, which cannot be made profitable for a lengthy period, the company may pay interest on the share capital for the period and subject to the conditions and restrictions in this section mentioned, and may charge the same to capital as part of the cost of construction of the works or buildings or the provision of plant.

(2) Payment must not be made under subsection (1) unless it is authorised by the articles or by special resolution of the company, and the approval of the Minister has first been had and obtained.

(3) The Minister may, before approving payment under subsection (2), at the expense of the company, appoint a person to enquire into and report to him or her on the circumstances of the case, and may before making the appointment require the company to give sufficient security for the payment of the costs of the enquiry.

(4) Any payment contemplated in this section must be made only for a period which may be determined by the Minister and that period must in no case extend beyond the close of the half-year next after the half-year during which the works or buildings have been actually completed or the plant provided.

(5) The rate of any interest payable under subsection (1) must not exceed 10 per cent per annum or any other rate which may be determined by the Minister.

(6) The payment of the interest does not operate as a reduction of the amount paid up on the shares in respect of which it is paid.

(7) For the purposes of subsection (4) the expression "half-year" in relation to a company, means the period of six months commencing on the first or ending on the last day of the financial year of that company.

Restriction of power to pay commission and discounts

86. (l) A company may pay commission to any person in consideration of that person subscribing or agreeing to subscribe, whether absolute or conditional, for any shares of the company, or procuring or agreeing to procure subscriptions, whether absolute or conditional, for any shares of the company if -

(a) the payment of the commission is authorised by the articles;

(b) the commission paid or agreed to be paid does not exceed 10 per cent ofthe price at which shares are issued or any lesser rate fixed by the articles;

54 Government Gazette 30 December 2004 No.3362

Act No. 28, 2004 COMPANIES ACT, 2004

(c) the amount or rate per cent of the commission paid or agreed to be paid is -

(i) in the case of shares offered to the public, disclosed in the prospectus; or

(ii) in the case of shares not offered to the public, disclosed in a statement in the prescribed form and where any circular or notice, not being a prospectus, inviting subscription for shares is issued, also disclosed in that circular or notice; and

(d) the number of shares for which persons have agreed, for a commission, to subscribe absolutely, is disclosed in the manner specified in paragraph (c).

(2) The statement referred to in subsection (l)(c)(ii) must be lodged with the Registrar for registration before the payment of the commission to which the statement relates.

(3) Save as otherwise provided in subsection (1) and subject to section 87, a company must not apply any of its shares or capital money either directly or indirectly in payment of any commission, discount or allowance to any person in consideration of that person subscribing or agreeing to subscribe, whether absolute or conditional, for any shares of the company, or procuring or agreeing to procure subscriptions, whether absolute or conditional, for any shares of the company, whether the shares or money be so applied by being added to the purchase price of any property acquired by the company or to the contract price of any work to be executed for the company or the money be paid out of the nominal purchase price or contract price, or otherwise.

(4) Nothing in this section affects the power of any company to pay any brokerage which it has before this Act been lawful for a company to pay.

(5) A vendor to, promoter of, or other person who receives payment in money or shares from, a company, must have and is deemed always to have had power to apply any part of the money or shares so received in payment of any commission, the payment of which, if made directly by the company, would have been lawful under this section.

(6) A company which fails to comply with the requirements of subsection (2) relating to the lodging of the statement referred to in that subsection with the Registrar, and every director and officer of the company who knowingly is a party to that failure, commits an offence and is liable to a fine which does not exceed N$40 for every day during which the contravention continues.

Issue of shares of par value at discount

87. (I) A company may issue at a discount shares having a par value of a class already issued if the following conditions have been complied with-

(a) the issue must be authorised by special resolution of the company specifying the maximum rate of discount at which the shares are to be issued;

(b) not less than one year must, at the date of issue, have elapsed since the date on which the company became entitled to commence business or the date of the first issue of the class of shares;

(c) the issue must be sanctioned by the Court; and

(d) the shares to be issued at a discount must be issued within one month after the date on which the issue is sanctioned by the Court or within any extended time which the Court may allow.

No.3362 Government Gazette 30 December 2004 55 Act No. 28, 2004 COMPANIES ACT, 2004

(2) The Court may, on application for an order sanctioning the issue of shares contemplated in subsection (1), having regard to all the circumstances of the case, make an order on appropriate terms and conditions.

(3) Every prospectus relating to the issue of shares by the company after the issue of the shares at a discount under this section must contain particulars of the discount allowed on the issue of those shares or of so much of that discount as has not been written off at the date of the issue of the prospectus.

(4) A company which fails to comply with subsection (3), and every director and officer of the company who knowingly is a party to that failure, commits an offence and is liable to a fine which does not exceed N$2 000.

Issue price of shares of no par value requiring special resolution

88. (1) A company must not issue shares having no par value of a class already issued at a price lower than an amount arrived at by dividing that part of the stated capital contributed by already issued shares of that class, by the number of issued shares of that class, unless the issue price of those shares is authorised by a special resolution of the company.

(2) The notice convening the meeting for the purpose of passing the special resolution referred to in subsection (1) must be accompanied by a report by the directors setting out the reasons for the proposed lower issue price.

(3) A special resolution under subsection (1) must not be registered in the Companies Registration Office unless the copy lodged with the Registrar is accompanied by a copy of the report by the directors referred to in subsection (2).

(4) This section does not apply where the issue of shares is in pursuance of an offer for subscription to all existing members in proportion to their shareholdings, whether with or without the right to renounce in favour of other persons.

Part 2 Acquisition by Companies of Own Shares

Approval of acquisition of own shares by special resolution

89. (1) Subject to this section, sections 90 and 91 and any other applicable law, a company may by special resolution, if authorised by its articles, approve the acquisition of shares issued by that company.

(2) The approval by special resolution may be a general approval or a specific approval for a particular acquisition.

(3) If the approval is a general approval, it is valid only until the next annual general meeting of the company, but it may be varied or revoked by special resolution by any general meeting of the company at any time before that annual general meeting.

Company to be solvent

90. A company must not make any payment in whatever form to acquire any share issued by the company if there are reasonable grounds for believing that -

(a) the company is, or would after the payment be, unable to pay its debts as they become due in the ordinary course of business; or

(b) the consolidated assets of the company fairly valued would, after the payment, be less than the consolidated liabilities of the company.

56 Government Gazette 30 December 2004 No.3362 Act No. 28, 2004 COMPANIES ACT, 2004

Consequences of acquisition with regard to shares

91. (1) In the case of the acquisition of par value shares issued by the company, the issued capital must be decreased by an amount equal to the par value ofthe shares so acquired.

(2) In the case of the acquisition of no par value shares issued by the company, the stated capital of the class of shares so acquired must be decreased by an amount derived by multiplying the number of shares of that class so acquired with the amount arrived at by dividing the stated capital contributed by issued shares of that class by the number of issued shares of that class.

(3) If par value shares are acquired at a premium over the par value, the premium may be paid out of reserves, including statutory non-distributable reserves.

(4) Shares issued by a company and acquired under this section must be cancelled as issued shares and restored to the status of authorised shares forthwith.

(5) Shares in the capital of a company may not be acquired under this section if, as a result of that acquisition, there would no longer be any shares in issue other than convertible or redeemable shares.

Liability of directors and shareholders under certain circumstances

92. (1) The directors of a company who, contrary to section 90, allow the company to acquire any share issued by it, are jointly and severally liable to restore to the company any amount so paid and not otherwise recovered by the company, subject to any relief granted by the Court under section 256.

(2) A director who is liable under subsection (1) may apply to the Court for an order compelling a shareholder or former shareholder to pay to the company any consideration that was paid to that shareholder contrary to section 90.

(3) Where the acquisition by the company of shares issued by it is in contravention of section 90, any creditor who was a creditor at the time of the acquisition, or who is a creditor because of a cause of debt which arose before that acquisition, or any shareholder, may apply to the Court for an order, and the Court may, if it finds it equitable to do so-

(a) order a shareholder or former shareholder to pay to the company any money or return any consideration that was paid or given by the company to acquire the shares;

(b) order the company to issue an equivalent number of shares to the shareholder or former shareholder; or

(c) make any other appropriate order.

(4) An action to enforce a liability imposed by this section must be instituted within three years after the date of the acquisition.

(5) Nothing contained in this section limits or diminishes any liability which any person may incur under this Act or any other law, or the common law.

(6) For the purposes of this section and section 95, "director of a company" includes any director of a holding company of that company.

No.3362 Government Gazette 30 December 2004 57 Act No. 28, 2004 COMPANIES ACT, 2004

Procedure of acquisition of certain shares by company

93. (1) Save as is provided in subsection (2), a company that proposes to acquire shares issued by it must -

(a) deliver or mail a copy of the written offering circular in the prescribed form, to each registered shareholder on record as at the date of the offer in any manner which is provided in the articles of the company for the sending of any notice of a meeting of shareholders, stating the number and the class or kind of its issued shares which the company proposes to acquire, and specifying the terms and reasons for the offer;

(b) lodge a copy of the offering circular with the Registrar within 15 days of the date that it is delivered or mailed to the shareholders of the company.

(2) Subsection (1) does not apply-

(a) to the extent that it is dispensed with in terms of the special resolution passed in terms of section 89;

(b) in the case of a company whose shares are listed on a stock exchange within Namibia, to the acquisition by that company of shares in terms of transactions effected on that stock exchange in accordance with the rules and listing requirements of that exchange.

(3) Sections 168 to 171 relating to the civil liability of directors or promoters of a company for untrue statements in prospectuses, the civil liability of experts for untrue statements, criminal liability for untrue statements in prospectuses and the retention of liability for untrue statements under the common law respectively, do, with the necessary changes, apply to all documents issued in terms of subsection (1).

(4) Where in response to any offer to acquire shares, the shareholders propose to dispose of a greater number of shares than the company offered to acquire, the company must acquire from all of the shareholders who offered to sell, on a proportional basis as nearly as possible disregarding fractions, except that this subsection does not apply to the acquisition of shares in terms of transactions effected on a stock exchange within Namibia.

(5) A company that acquires shares issued by it must, within 30 days and in the prescribed form, notify the Registrar of the date of the acquisition, the date, number and class of shares that it has acquired.

(6) A stock exchange within Namibia may, in addition to any requirements contained in this Act, determine further requirements with which a company whose shares are listed on that exchange must comply with prior to that company acquiring its own shares.

Enforceability of contracts for acquisition by company of certain shares

94. (1) A contract with a company providing for the acquisition of shares issued by it is enforceable against the company, except if the company cannot execute the contract without being in breach of section 90.

(2) In an action brought on a contract referred to in subsection (1), the company has the burden of proving that execution of the contract is or will be in breach of section 90.

58 Government Gazette 30 December 2004 No.3362 Act No. 28, 2004 COMPANIES ACT, 2004

(3) Until the company has fully performed its obligations in terms of a contract referred to in subsection (1), shareholders who dispose oftheir share retain the status of claimants entitled to be paid as soon as the company is lawfully able to do so or, on liquidation, to be ranked subordinate to creditors and shareholders whose claims are in priority to the claims of the class of shares which they disposed of to the company, but in priority to the claims ofthe other shareholders.

Subsidiaries may acquire certain shares in holding company

95. (1) A subsidiary company may, if authorised by its articles, with the necessary changes, in accordance with sections 89 to 94, inclusive, acquire shares in its holding company to a maximum of 10 per cent in the aggregate of the number of issued shares of the holding company.

(2) Sections 89 and 93( 1) to (4) do not apply ifthe subsidiary is a wholly owned subsidiary of the holding company.

Payments to shareholders

96. (1) A company may make payments to its shareholders subject to this section and if authorised by its articles.

(2) A company must not make any payment in whatever form to its shareholders if there are reasonable grounds for believing that -

(a) the company is, or would after the payment be, unable to pay its debts as they become due in the ordinary course of business; or

(b) the consolidated assets of the company fairly valued would after the payment be less than the consolidated liabilities of the company.

(3) For the purposes of this section "payment" includes any direct or indirect payment or transfer of money or other property to a shareholder of the company by virtue of the shareholder's shareholding in the company, but excludes an acquisition of shares in terms of sections 89 to 91, inclusive, a redemption of redeemable preference shares in terms of section 104, any acquisition of shares in terms of an order of Court and the issue of capitalisation shares in the company.

(4) Section 92 in so far as it relates to the liability of the directors of a company to compensate the company where shares are acquired by the company contrary to section 90 applies, with the necessary changes, to any payment made contrary to this section.

(5) If payment to a holding company by a subsidiary is in the form of shares of the holding company, the shares so received by the holding company and for as long as those shares are held by the holding company -

(a) no voting rights attaching to those shares may be exercised; and

(b) the votes able to be cast at any meeting of the holding company must be reduced by the votes in respect of shares held by the holding company itself.

Part 3 Shares and Allotment and Issue

Nature of shares and payment for shares

97. (I) The shares or other interest which any member has in a company are movable property, transferable in the manner provided by this Act and the articles of the

No.3362 Government Gazette 30 December 2004 59 Act No. 28, 2004 COMPANIES ACT, 2004

(2) A company must not allot or issue any shares unless the full issue price of or other consideration for those shares has been paid to and received by the company.

(3) Notwithstanding subsection (2), a company may allot or agree to allot shares not fully paid-up for the purpose of their being offered for sale to the public as fully paid-up shares, but -

(a) if that offer is not made within one month from the date of the allotment or agreement, that allotment or agreement is void; or

(b) if the offer to the public is made but not accepted in full within two months from the date of the allotment or agreement to allot, the allotment of, or the agreement to allot, the shares in respect of which the full issue price is not paid within that period, is void.

Un certificated securities

98. (1) In this section-

(a) "central securities depositor" means a public company incorporated in terms of this Act and registered as central securities depository in terms of any law relating to the custody and administration of securities;

(b) "participant" means a depositary institution accepted by a central securities depository as a participant in terms of any law relating to the custody and administration of securities;

(c) "subregister" means the record of uncertificated securities administered and maintained by a participant, which forms part of the relevant company's register of members as referred to in this Act; and

(d) "uncertificated securities" means securities as defined in section 1 of the Stock Exchanges Control Act, 1985 (Act No.1 of 1985), which are by virtue of this section transferable without a written instrument and are not evidenced by a certificate, and includes options on indices of information as issued by a stock exchange on prices of any of the instruments mentioned in that definition, as well as any other instruments declared by the Registrar by notice in the Gazette to be securities.

(2) This section applies to uncertificated securities, notwithstanding any provision to the contrary contained in this Act or in any other law, the common law, an agreement or any articles.

(3) Where any provision of this Act is not expressly or impliedly amended by this section, this Act applies in respect of uncertificated securities in the same manner as it applies to securities in certificated form.

(4) A company must enter in its register of members, in respect of every class of securities, the total number of securities held in uncertificated form.

(5) A subregister which must form part of the relevant company's register of members must, notwithstanding subsection (15), contain the details referred to in sections 112 and 140, but, the name of any person for whom a participant holds uncertificated securities as nominee must not form part of the subregister.

(6) A participant is responsible for entering the information referred to in sections 112 and 140 in a subregister and for ensuring the correctness of all transfers of uncertificated securities effected by the participant.

60 Government Gazette 30 December 2004 No.3362 Act No. 28, 2004 COMPANIES ACT, 2004

(7) A participant must, at the request of a company and against payment of such fee as may be prescribed by the Minister from time to time, furnish that company with such details of uncertificated securities in the company as are reflected in the subregister maintained by the participant.

(8) A person who wishes to inspect a subregister may do so only through the relevant company in terms of section 120.

(9) A company is, within seven days of the date of a request for inspection, required to produce a subregister which reflects at least the details referred to in subsection (6) at the close of business on the day on which the request for inspection was made.

(10) A participant must send out, to every person for whom the participant holds uncertificated securities, a regular statement setting out the number and identity of the uncertificated securities held on that person's behalf.

(11) The cost and frequency of the statement referred to in subsection (10) will be prescribed but the cost must not be borne by the person for whom the uncertificated securities are held.

(12) Transfer of ownership in an uncertificated security is effected on the debiting and crediting, respectively, of both the account in the subregister from which the transfer is effected and the account in the subregister to which transfer is to be made, in accordance with the rules of a central securities depository.

(13) A transferee does, on the entry of the transferee's name in a subregister, become a member of and must be recognised as a member by the company in respect of the uncertificated securities registered in the transferee's name.

(14) Transfer of ownership and membership in accordance with subsections (12) and (13) occurs notwithstanding any fraud or illegality which may affect the uncertificated securities in respect of which the transfer was effected or which may have resulted in the transfer being effected, but, a transferee who was a party to or had notice of the fraud or illegality may not rely on this subsection.

(15) Section 140 does not apply to the transfer of ownership of uncertificated securities and also not to the acquisition of membership of a company as a result of such transfer.

(16) A company is liable to a participant for such fee as may be prescribed by the Minister from time to time in respect of the transfer of ownership of uncertificated securities in the company.

(17) Only a participant may effect the transfer of uncertificated securities in a subregister maintained by it.

(18) A participant may transfer uncertificated securities in a subregister administered and maintained by it, only on receipt of an instruction to transfer sent and properly authenticated in terms of the rules of a central securities depository or by order of the Court.

(19) Nothing in this section prejudices any power of a participant to effect transfer to a person to whom the right to any uncertificated securities of a company has been transmitted by operation of law or agreement.

(20) Section 121 does not apply to a subregister.

No.3362 Government Gazette 30 December 2004 61 Act No. 28, 2004 COMPANIES ACT, 2004

(21) Subject to subsection (22), a company must not issue certificates evidencing, or purporting to evidence, title to uncertificated securities of the company, and sections 102 and 147 do not apply to uncertificated securities.

(22) Any person who wishes to withdraw uncertificated securities held by a participant on that person's behalf and to obtain a certificate in respect of all or part of those securities, must notify the participant, in which case -

(a) the participant must, within seven days, notify the relevant company to provide such a certificate and remove the details of the uncertificated securities so withdrawn from the subregister maintained by that participant;

(b) the company must, immediately on receipt of a notice from a participant, enter the relevant person's name and details in respect of that person's holding in the company's register of members and indicate on that register that the securities so withdrawn are no longer held in uncertificated form;

(c) the company must, within 14 days of receipt of the notice referred to in paragraph (a), prepare and deliver to the relevant person a certificate in respect of the securities so withdrawn, and notify the central securities depository that the securities are no longer held in uncertificated form; and

(d) transfer of ownership or acquisition of membership in respect of the securities so withdrawn is not capable of being effected through a central securities depository while they remain in certificated form.

(23) A person who takes any unlawful action in consequence of which any of the following events occur in a register or subregister, namely-

(a) the name of any person remains in, is entered in, or is removed or omitted;

(b) the number of uncertificated securities is increased, reduced, or remains unaltered; or

(c) the description of any uncertificated security is changed,

is liable to any person who has suffered any direct loss or damage arising out of that action.

(24) A person who gives an instruction to transfer uncertificated securities must warrant the legality and correctness of any such instruction.

(25) The person referred to in subsection (24), must indemnify the company and the participant effecting the transfer against any claim and against any direct loss or damage suffered by them arising out of that transfer by virtue of an instruction referred to subsection (24).

(26) A participant who transfers uncertificated securities other than pursuant to an instruction to transfer that was sent and properly authenticated in terms of the rules of a central securities depository, must indemnify the company against any claim made on it and against any direct loss or damage suffered by it arising out of the transfer and that participant must, in addition, indemnify any person who suffers any direct loss or damage arising out of the transfer, against the loss or damage.

(27) Subject to subsection (28), when any new offer of securities is made by a company, the offeree may elect whether all or any part of the securities offered to the offeree must be issued in certificated or uncertificated form.

62 Government Gazette 30 December 2004 No.3362

Act No. 28, 2004 COMPANIES ACT, 2004

(28) A company must only issue or allot uncertificated securities to a person who is already a client of a participant or for whom a participant has agreed to act.

(29) The Minister may make regulations regarding matters which are supplementary and ancillary to this section and which are not inconsistent with another provision of this Act.

(30) Any person -

(a) other than a participant, who effects the transfer of un certificated securities in contravention of subsection (17);

(b) who takes any unlawful action contemplated in subsection (23); or

(c) who, without proper authority, accesses any computer system or record maintained by a participant or a central securities depository,

commits an offence and is liable to a fine not exceeding N$500 000 or to imprisonment for a period which does not exceed two years or to both the fine and imprisonment.

Register and return as to allotments

99. (1) Every company having a share capital must keep, at its registered office or at the office where it is made up, a register of allotments of shares.

(2) Every company must, as soon as is reasonably possible after the allotment of any shares, enter in the register of allotments the names and addresses of the allottees, the number of shares allotted to each ofthem, the amount paid for those shares and in the case of shares allotted as fully paid-up otherwise than for cash, full particulars of the consideration in respect of which the allotment was made and of the transaction or contract concerned.

(3) Whenever a company makes any allotment of its shares, the company must within one month thereafter lodge with the Registrar -

(a) a return in the form prescribed stating full particulars of the nominal and previously issued share capital or stated capital and the number and description of the shares comprised in the allotment;

. (b) in the case of shares allotted otherwise than for cash, a copy of the contract in writing constituting the title of the allottee to the allotment, together with any contract of sale, or for service or other consideration in respect of which that allotment was made or, ifthat contract is not in writing, a memorandum containing full particulars of the contract, and a return in the prescribed fonn stating the number and description of the shares so allotted, the name and address of that allottee and the consideration for which they have been allotted.

(4) If any allotment of shares becomes void as a result of any provision of this Act, the company must, within one month after the date on which that allotment becomes void, lodge a notice in the prescribed form to that effect with the Registrar.

(5) If default is made in complying with any ofthe requirements of this section, the company, and every director or officer of the company who knowingly is a party to the default, commits an offence and is liable to a fine which does not exceed N$2 000.

(6) Section 120 which relates to the inspection of the company's register of members by any person does, with the necessary changes, apply to the inspection of and the furnishing of copies of or extracts from the register of allotments.

No.3362 Government Gazette 30 December 2004 63

Act No. 28, 2004 COMPANIES ACT, 2004

Certificate of shares or stock

100. (1) A certificate signed-

(a) by two directors of a company;

(b) by one director and one officer duly authorised by the directors; or

(c) in the case of a company having only one director and no officer, by that director,

and specifying any shares or stock of that company held by any member, is sufficient evidence of the title of the member to those shares or that stock.

(2) A signature referred to in subsection (1) may be affixed to the certificate by autographic or mechanical means.

Numbering of shares and share certificates

101. (1) The shares ofa company having a share capital must, except in the case of shares or any particular class of shares which rank equally for all purposes, be distinguished by appropriate numbers.

(2) No provision in the articles ofa company registered before the coming into operation of this Act requiring shares of that company to be numbered, applies in respect of shares which in terms of subsection (1) are not required to have distinguishing numbers.

(3) Where shares are not distinguished by appropriate numbers, the certificates of those shares must be so distinguished, and on the registration of transfer of those shares the certificate relating to those shares must, in addition to the distinguishing number, bear on its face an endorsement, in the form of a reference number or otherwise, so as to enable the immediately preceding holder of the shares to be identified.

Limitation of time for issue of share certificates

102. (1) Every company must, within two months or within any extended time, not exceeding one month which the Registrar on good grounds shown and on payment of the prescribed fee may grant, after the allotment of any of its shares, debentures or debenture stock, complete and have ready for delivery the certificates of all shares, the debentures or the certificates of all debenture stock allotted.

(2) If a company fails to comply with subsection (1), any person entitled to the certificates of shares, the debentures or the certificates of debenture stock in question may, by notice in writing, call on the company to comply, and if the company fails to comply with the notice within 10 days after service of the notice, the Court may on the application of that person make an order directing the company to comply within the time specified in the order, and, where appropriate, it may direct that any costs of or incidental to the application be borne by the company or by any director or officer of the company responsible for the failure to comply.

(3) A company which, and a director or officer of a company who intentionally fails to comply with subsection (1), commits an offence and is liable to a fine which does not exceed N$40 for every day during which the contravention continues.

Validation of irregular creation, allotment or issue of shares

103. (1) If a company has purported to create, allot or issue shares and the creation, allotment or issue of those shares was invalid because of this Act or any other

64 Government Gazette 30 December 2004 No.3362

Act No. 28, 2004 COMPANIES ACT, 2004

law or of the memorandum or articles ofthe company or otherwise, or the terms of the creation, allotment or issue were inconsistent with or not authorised by this Act, any law or the memorandum or articles of the company, the Court may on application made by the company or by any interested person and on being satisfied that in all the circumstances it is just and equitable to do so, make an order validating the creation, allotment or issue of those shares or confirming the terms of the creation, allotment or issue thereof, subject to any conditions which the Court may impose.

(2) The Court must, when making an order under subsection (1), direct that a copy of the order be lodged with the Registrar.

(3) On the registration of the copy of the order referred to in subsection (1) by the Registrar and after the payment of all prescribed fees, the shares are deemed to have been validly created, allotted or issued on the terms of the creation, allotment or issue and subject to any conditions imposed by the Court.

Redeemable preference shares

104. (1) Subject to this section, a company having a share capital, if so authorised by its articles, may issue preference shares which are, or at the option of the company, liable to be redeemed, except that -

(a) the shares must not be redeemed except out of profits of the company which would otherwise be available for dividends or out of the proceeds of a fresh issue of shares made for the purposes of the redemption;

(b) where the shares are redeemed otherwise than out of the proceeds of a fresh issue, there must, out of profits which would otherwise have been available for dividends, be transferred to a reserve fund, to be called the "capital redemption reserve fund", a sum equal to the nominal amount of the shares redeemed, or if shares of no par value, to the book value of the shares redeemed;

(c) the shares must not be redeemed unless and until the premium, if any, payable on redemption, has been provided for out of the profits of the company or out ofthe company's share premium account;

(d) the redemption of the shares must be effected on the terms and in the manner provided for in the articles of the company.

(2) Where in pursuance of this section a company has redeemed or is about to redeem any preference shares, it has the power to issue shares, including, if the company so decides by special resolution, shares other than redeemable preference shares, up to the nominal amount of the shares redeemed or to be redeemed or in the case of preference shares of no par value, up to the book value of the shares redeemed or to be redeemed, as if those shares had never been issued, and the share capital of the company or the number of shares of no par value must, not for the purposes of section 81(2), be deemed to be increased by the issue of shares in pursuance of this subsection.

(3) Where new shares are issued before the redemption of the old shares, the new shares are not, for the purposes of any law relating to stamp duty, deemed to have been issued in pursuance of subsection (2), unless the old shares are redeemed within 30 days after the issue of the new shares.

(4) The capital redemption reserve fund may, notwithstanding this section, be applied by the company in paying up unissued shares of the company to be issued to members of the company as fully paid-up capitalisation shares or for the payment of the premium over the par value in the case of an acquisition of shares in terms of sections 89 +" 01 ;n{"l11~l"p.

No.3362 Government Gazette 30 December 2004 65 Act No. 28, 2004 COMPANIES ACT, 2004

(5) Ifa company has redeemed any redeemable preference shares, it must, within one month, give notice to that effect in the prescribed form to the Registrar specifying the shares so redeemed.

(6) A company which fails to comply with subsection (5) commits an offence and is liable to a fine which does not exceed N$40 for every day during which the contravention continues.

(7) For the purposes of subsections (1) and (2) "book value" in respect of preference shares of no par value, means that part of the stated capital contributed by the preference shares redeemed or to be redeemed.

(8) This section also applies in respect of any balance of any capital redemption reserve fund created by a company prior to 1 January 1974.

Conversion of shares into certain preference shares

105. If a company has converted any of its shares into preference shares which are, or at the option of the company are liable, to be redeemed, section 104 applies to those preference shares.

Conversion of shares into stock

106. (1) A company having a share capital, if so authorised by its articles, may by special resolution convert all or any of its paid-up shares into stock and reconvert that stock into any number of paid-up shares.

(2) Where a company has converted any of its shares into stock, the provisions of this Act which apply exclusively in respect of shares, cease to apply to so much of the share capital as has been so converted.

Share warrants to bearer

107. (1) A public company having a share capital, if so authorised by its articles, may, with respect to any paid-up shares, or to stock, issue a warrant stating that the bearer of the warrant is entitled to the shares or stock specified in the warrant, and may provide, by coupons or otherwise, for the payment of the future dividends on the shares or stock included in the warrant.

(2) A share warrant entitles its bearer to the shares or stock specified in it, and any shares or stock which may be transferred by the delivery of the share warrant.

Variation of rights in respect of shares

108. (1) If, in the case ofa company the share capital of which is divided into different classes of shares, provision is made by the memorandum or articles for authorising the variation of the rights attached to any class of shares of the company, subject to the consent of any specified proportion of the holders of the issued shares of that class or the sanction of a resolution passed at a separate meeting of the holders of those shares, and if in pursuance of that provision the rights attached to that class of shares are at any time varied, the holder of a share of that class, being a person who did not consent to or vote in favour of the resolution for the variation, may apply to the Court for an order under section 260.

(2) The expression "variation" in this section includes abrogation and the expression "varied" must be construed accordingly.

66 Government Gazette 30 December 2004 No.3362

Act No. 28, 2004 COMPANIES ACT, 2004

(3) The company must, within one month from the date of the consent or resolution referred to in subsection (1), lodge with the Registrar in the prescribed form the particulars of the consent or resolution, and where a company fails to comply with this provision, the company, and every director and officer of the company who knowingly is a party to that failure, commits an offence and is liable to a fine which does not exceed N$40 for every day during which the contravention continues.

No offer of shares for sale to public without statement

109. (1) In this section, unless the context otherwise indicates, the word -

(a) "offer" includes an invitation to make an offer to purchase;

(b) "shares" means the shares of a company, whether a company within the meaning of this Act or not, and includes debentures and units;

(c) "unit" means any right or interest, by whatever name called, in a share,

and for the purposes of this section a person must not, in relation to a company, be regarded as not being a member of the public because that person is a holder of shares of the company or a purchaser of goods from the company.

(2) A person must not, either orally or in writing, make an offer of shares for sale to the public or issue, distribute or publish any material which in its form and context is calculated to be understood as an offer for sale to the public, unless it is accompanied by a written statement (in this section referred to as the "written statement") containing the particulars required by this section to be included in the offer.

(3) Subsection (1) does not apply -

(a) if the shares to which the offer or material relates are shares which are listed by, or in respect of which permission to deal in them has been granted by, any stock exchange in Namibia recognised by the Minister by notice in the Gazette for the purposes of this section, and the person making the offer or publishing the material so states in writing, specifying the name of the stock exchange;

(b) if the offer is made or the material is published only to persons -

(i) whose ordinary business or part of whose ordinary business it is to deal in shares, whether as principals or agents; or

(ii) who are at the time of the offer the holders of shares of the same company;

(c) in the case of an offer in that capacity, by an executor or administrator of a deceased estate or a trustee of an insolvent estate;

(d) if the offer is made or the material is published for the purpose of a sale in execution or by public auction or by public tender; or

(e) if the offer is accompanied by a prospectus registered under Chapter 6 of this Act.

(4) The written statement must be dated and signed by the person or persons making the offer or issuing, distributing or publishing the material, and if that person is a company, by every director of the company.

No.3362 Government Gazette 30 December 2004 67

Act No. 28, 2004 COMPANIES ACT, 2004

(5) The written statement must not contain any matter other than the particulars required by this section to be included, and must not be in characters less large or less legible than any characters used in the offer or in any document accompanying that statement.

(6) The written statement must contain particulars with respect to the following matters -

(a) whether the person making the offer is acting as principal or agent and, ifas agent, the name of that person's principal and an address in Namibia where that principal can be served with process, and the nature and extent of the remuneration received or receivable by the agent for his or her services;

(b) the date on which and the country in which the company was incorporated and the address of its registered office in Namibia or, if there is no such address, the address of its principal office abroad;

(c) the share capital of the company and the number of shares which have been issued, the classes into which it is divided and the rights of each class of shareholders in respect of capital, dividends and voting and the number and amount of shares issued for cash and the number and amount issued for a consideration other than cash, and the dates on which and the prices at which or the consideration for which those shares were issued;

(d) the dividends, if any, paid by the company on each class of shares during each of the five financial years immediately preceding the offer, and if no dividend has been paid in respect of shares of any particular class during any of those years, a statement to that effect;

(e) the total amount of any debentures issued by the company and outstanding at the date of the statement, together with the rate of interest payable;

(f) the names and addresses of the directors of the company;

(g) whether or not the shares are listed or permission to deal therein has been granted by any stock exchange other than that referred to in subsection (3), and, if so, which, and, if not, a statement that they are not so listed or that no permission has been granted;

(h) if the offer relates to units, particulars of the names and addresses of the persons in whom the shares represented by the units are vested, the date and the parties to any document defining the terms on which those shares are held, and an address in Namibia where that document or a copy can be inspected;

(i) the dates on which and the prices at which the shares offered were originally issued by the company, and were acquired by the person making the offer or by that person's principal, giving the reasons for any difference between those prices and the prices at which the shares are being offered;

(j) if the shares were issued as partly paid-up shares under the repealed Act, to what extent they are paid-up; and

(k) the date of registration of the written statement by the Registrar.

(7) For the purposes of subsection (6) the word "company" means the company by which the shares to which the statement relates were issued.

68 Government Gazette 30 December 2004 No.3362 Act No. 28, 2004 COMPANIES ACT, 2004

(8) There must be annexed to the written statement a copy of the last annual financial statements of the company and subsequent interim report and provisional annual financial statements, if any.

(9) Where the offer referred to in subsection (2) is in respect of shares of a public company, a copy of the written statement must be lodged with the Registrar for registration before it is issued, distributed or published, and that statement must not be issued, distributed or published more than three months after the date of that registration.

(10) Any person who contravenes this section commits an offence, and if that person is a body corporate, every director and officer of that body corporate commits the same offence and is liable to a fine which does not exceed N$4 000 or to be imprisoned for a period which does not exceed one year or to both the fine and imprisonment.

(11) If any person is convicted of having made an offer in contravention of this section, the Court by which that person is convicted, may order that any contract made as a result of the offer is void, and where it makes that order, may give any consequential directions which are proper for the repayment of any money or the retransfer of any shares.

Part 4 Members and Register of Members

Members of a company

110. (1) The subscribers of the memorandum of a company are deemed to have agreed to become members of a company on its incorporation, and must, as soon as reasonably possible after incorporation, be entered as members in its register of members.

(2) Every other person who agrees to become a member of a company and whose name is entered in its register of members, becomes a member of that company.

(3) A company must, subject to its articles, enter in the register as a member of the company by virtue of his or her office, the name of any person who submits proof of his or her appointment as the executor, administrator, trustee, curator or guardian in respect of the estate of a deceased member of the company or of a member whose estate has been sequestrated or of a member who is otherwise under disability or as the liquidator of any body corporate in the course of being wound up which is a member of the company, and any person whose name has been so entered in the register is for the purposes of this Act deemed to be a member of the company.

(4) Subject to section 221(2), the bearer ofa share warrant may, if the articles of the company so provide, be deemed to be a member of the company within the meaning of this Act, either for all purposes or for the purposes which are specified in the articles.

Trusts in respect of shares

111. A company is not bound to see to the execution of any trust, whether express, implied or constructive, in respect of any share.

Register of members

112. (l) Every company must, in the official language, keep a register of its members, and must, in that register, enter -

(a) the names and addresses of the members and, in the case of a company having a share capital, a statement of the shares issued to each member, distinguishing each share by its number, if any, and by its class or kind, and of the amount paid or agreed to be considered as paid on the shares of each member; and

No.3362 Government Gazette 30 December 2004 69 Act No. 28, 2004 COMPANIES ACT, 2004

(b) in respect of each member -

(i) the date on which his or her name was entered in the register as a member; and

(ii) the date on which he or she ceased to be a member.

(2) Where a company has converted any of its shares into stock, the register of members must show the amount of stock held by each member instead of the number of shares and the particulars relating to shares specified in subsection (1).

(3) Where a company has issued share warrants it must, on the issue of a share warrant, strike out of its register of members the name of the member then entered as holding the shares or stock specified in the warrant as if that member had ceased to be a member and must enter in the register -

(a) the fact of the issue of the warrant;

(b) a statement of the shares or stock included in the warrant, distinguishing each share by its number, if the share has a number; and

(c) the date of the issue of the warrant.

(4) Until a share warrant is surrendered, the particulars must be the particulars required by this Act to be entered in the register of members, and on the surrender of the warrant, the date ofthe surrender must be entered as if it were the date on which a person ceased to be a member.

(5) The bearer of a share warrant is, subject to the articles of the company, entitled, on surrendering it for cancellation, to have his or her name entered as a member in the register of members, and the company is liable for any loss incurred by any person because of the company's entering in its register the name of a bearer of a share warrant in respect of the shares or stock therein specified without the share warrant being surrendered and cancelled.

(6) The register of members may be kept either by making entries in bound books or by recording the particulars required in any other manner and, in the case of a person who has ceased to be a member, also by microfilm or microcard or by miniature photographic or other process which accurately reproduces and forms a durable medium for recording and reproducing those particulars.

(7) If the register of members is not kept by making entries in bound books, adequate precautions must be taken for guarding against falsification and facilitating its discovery.

(8) The register of members of an existing company kept under the repealed Act and continued under this Act in a language other than the official language is deemed to be sufficient compliance with subsection (1).

Index to register of members

113. (1) Every company having more than 50 members must, unless the register of members is in such form as to constitute in itself an index, keep an index of the names of the members of the company, and must, within 14 days after the date on which any alteration is made in the register of members, make any necessary alteration in the index.

(2) The index -

70 Government Gazette 30 December 2004 No.3362

Act No. 28, 2004 COMPANIES ACT, 2004

(a) may be in the form of a card index;

(b) is deemed to be a part of the register of members;

(c) must in respect of each member, contain a sufficient indication to enable the account of that member in the register to be readily found.

Branch registers in foreign countries

114. (1) A company having a share capital may, ifso authorised by its articles, cause to be kept in any foreign country a register of members resident in any foreign country (in this Part called a "branch register").

(2) The company referred to subsection (1) must give to the Registrar notice on the prescribed form of the situation of the office where any branch register is kept, and of any change in that situation, and of the discontinuance of the office in the event of its being discontinued.

Provisions as to branch register

115. (1) A branch register is deemed to be part of the company's register of members.

(2) A branch register must be kept in the same manner in which the register of members is by this Act required to be kept except that the notice referred to in section 121, must, for a reasonable period of time before the closing of the branch register, also be inserted in a newspaper circulating in the district where the branch register is kept.

(3) The company must transmit to its registered office a copy of every entry in its branch register as soon as may be after the entry is made and must cause to be kept at its registered office, duly entered up from time to time, a duplicate of its branch register, and the duplicate is, for the purposes of this Act, deemed to be part of the register of members.

(4) The company may discontinue to keep any branch register, and must, thereafter, transfer all entries in that register to some other branch register kept by the company or to the register of members.

(5) Subj ect to this Act and to any law relating to stamp duty or estate duty, any company may by its articles make any provision in relation to the keeping of its branch registers.

Register of members to be evidence

116. The register of members of a company sufficient evidence of any matters directed or authorised to be entered therein by this Act.

Where register of members to be kept

117. (1) Subject to this section, the register of members of a company must be kept at its registered office.

(2) A company's register of members may be kept at any office of the company in Namibia where the work of making it up is done, instead of at the company's registered office, and where a company arranges with some other person (in this section called "agent") for the making up of its register of members to be undertaken on behalf of the company by the agent, the register may be kept at the office of the agent in Namibia at which the work is done instead of at an office of the company.

No.3362 Government Gazette 30 December 2004 71

Act No. 28, 2004 COMPANIES ACT, 2004

(3) Any index ofthe names ofthe members of a company required to be kept in terms of section 113 must at all times be kept at the same place where the register of members is kept, and where the company keeps a branch register under section 114 the duplicate of the branch register required by section 115(3) to be kept at the company's registered office must, notwithstanding anything to the contrary contained in section 115(3), at all times be kept at the same place where the company's register of members is kept.

(4) Any company the register of members of which is not kept at its registered office must notify the Registrar in the prescribed form of the place where that register is kept and of any change in that place.

(5) The provisions of this section relating to the register of members of a company and the provisions of this Act relating to the inspection or production of that register or to the furnishing of copies of that register or any part of that register, do apply to any agent by whom that register is kept on behalf of a company in the same manner as they apply to the company.

Disposal of closed accounts in register

118. The parts of the register of members of a company pertaining to persons who have ceased to be members, in whatever manner kept under section 112, may be disposed of after the end of a period of 15 years after those persons have ceased to be members.

Offences in respect of register of members

119. Any company which or an agent referred to in section 117 who fails to comply with section 112, 113, 114, 115 or 117, commits an offence and is liable to a fine which does not exceed N$800.

Inspection of register of members

120. (1) The register of members of a company must, except when closed under this Act and subject to any reasonable restrictions which the company in a general meeting may impose, so that not less than two hours in each day be allowed for inspection during business hours, be open to inspection by any member or that member's authorised agent free of charge and by any other person upon payment for each inspection of the prescribed amount or any lesser amount which the company may determine.

(2) Any person may apply to a company for a copy of or an extract from the register of members and the company must either furnish that copy or extract to the applicant at cost or any lesser amount which the company may determine for every page of the required copy or extract, or afford that person adequate facilities for making a copy or extract.

(3) If access to the register of members for the purposes contemplated in subsection (1) or (2) is refused or not granted or furnished within 14 days after a written request to that effect has been delivered to the company, the company, and every director or officer of the company who knowingly is a party to the refusal or failure, commits an offence and is liable to a fine which does not exceed N$800.

(4) In the case of refusal or failure as contemplated in subsection (3) the Court may, on application, by order compel an immediate inspection of the register and index concerned or direct that the copy or extract required be sent to the applicant requiring it and may direct that any costs of or incidental to the application be borne by the company or by any director or officer of the company responsible for the refusal or failure.

72 Government Gazette 30 December 2004 No.3362

Act No. 28, 2004 COMPANIES ACT, 2004

(5) This section does, with the necessary changes, apply also in respect of any register of transfers kept by a company.

Power to close register of members

121. A public company may, after giving notice of its intention to do so in the Gazette and in a newspaper circulating in the district in which its registered office is situated, close its register of members, or any part of it relating to holders of any class of shares, for a period or periods not exceeding in the aggregate 60 days in any year.

Rectification of register of members

122. (1) If-

(a) the name of any person is, without sufficient cause, entered in or omitted from the register of members of a company; or

(b) default is made or unnecessary delay takes place in entering in the register the fact of any person having ceased to be a member,

the person concerned or the company or any member of the company, may apply to the Court for rectification of the register.

(2) The application referred to in subsection (1) must be made in accordance with the rules of Court or in any other manner which the Court may direct, and the Court may either refuse it or may order rectification of the register concerned and payment by the company, or by any director or officer of the company, of any damages sustained by any person concerned.

(3) On any application under this section the Court may decide any question relating to the title of any person who is a party to the application to have his or her name entered in or omitted from the register concerned, whether the question arises between members or alleged members or between members or alleged members on the one hand and the company on the other hand, and generally may decide any question necessary or expedient to be decided for the rectification of the register.

Part 5 Debentures

Creation and issue of debentures

123. A company, if so authorised by its memorandum or by its articles, may create and issue secured or unsecured debentures.

Security for debentures

124. (l) The binding of movable property as security for any debenture or debentures may be effected by -

(a) a deed of pledge and the delivery ofthe movable property concerned to one or more debenture holders or to a trustee for debenture holders;

(b) a notarial bond, collateral notarial bond or notarial surety bond executed in favour of one or more debenture holders or of a trustee for debenture holders; or

(c) the pledging of incorporeal rights by means of cession of those rights, whether present or future, in due and proper form.

No.3362 Government Gazette 30 December 2004 73

Act No. 28, 2004 COMPANIES ACT, 2004

(2) The binding of a ship may be effected by a deed of mortgage in the form prescribed by the Merchant Shipping Act, 1951 (Act No. 57 of 1951), recorded in the register by the proper officer at the ship's port of registry.

(3) The binding of immovable property as security for any debenture may be effected by a mortgage bond, collateral mortgage bond or surety bond executed in favour of one or more debenture holders or of a trustee for debenture holders.

(4) A wholly owned subsidiary is deemed to have and always to have had the power to mortgage any of its property as collateral security for the issue of debentures by its holding company.

Registration of bonds and annexure to bonds and deeds of pledge

125. (1) Any mortgage bond or notarial bond in pursuance of section 124 and any related subsequent transactions must, subject to the laws governing the registration of mortgage bonds and notarial bonds, be registered in a deeds registry.

(2) If a bond is in favour of one or more debenture holders, a certified copy of the debenture concerned must be annexed to that bond.

(3) If a bond is in favour of a trustee for debenture holders, certified copies of the debenture concerned and of the trust deed by which the trustee is appointed and in which the rights and duties of that trustee arc defined, must be annexed to that bond.

(4) Certified copies of the debenture concerned and of any trust deed, if any, must be annexed to any deed of pledge where the debentures are secured by a pledge of movable property.

Debenture itself may be registered

126. If any debenture is executed before a notary public, it may, subject to section 125( 1), be registered in a deeds registry in the same manner as if it were a notarial bond.

Issue of debentures at different dates and ranking of preference

127. In any bond or deed of pledge executed in favour of a trustee for debenture holders generally, provision may be made that the debentures thereby secured or to be secured may be issued from time to time and at different dates, as the company may determine, but all those debentures, whenever issued, must rank in preference concurrently with one another as from the date on which the pledge was constituted or the bond was registered.

Rights of debenture holders

128. (1) Every holder of a debenture secured by a pledge or a bond executed in favour of a trustee for debenture holders generally is, unless it is otherwise provided by the deed of pledge, bond or trust deed and copy of the debenture annexed to it, entitled to enforce his or her rights under that debenture as soon as it has been issued to him or her in the same manner as if he or she were himself or herself the pledgee or the holder of that bond.

(2) No notice of the cession of any debenture referred to in subsection (1) is necessary in order to confer on any cessionary the rights of the cedent.

Director or officer not to be trustee for debenture holders

129. A director or officer of a company cannot be a trustee for the holders of debentures of that company.

74 Government Gazette 30 December 2004 No.3362 Act No. 28, 2004 COMPANIES ACT, 2004

Liability of trustee for debenture holders

130. (1) Subject to this section, any provision contained in a trust deed for securing an issue of debentures, or in any contract with the holders of debentures secured by a trust deed, is void in so far as it would have the effect of exempting a trustee from or indemnifying a trustee against liability for breach of trust where the trustee fails to show the degree of care and diligence required of him or her as trustee, having regard to the trust deed conferring on the trustee any powers, authorities or discretions.

(2) Subsection (1) does not have the effect of:

(a) invalidating any release otherwise validly given in respect of anything done or omitted to be done by a trustee before the giving of the release or any provision enabling that release to be given -

(i) with the consent of a majority of not less than three-fourths in value of the debenture holders present and voting in person or by proxy at a meeting summoned for the purpose; and

(ii) with respect to specific acts or omissions or on the trustee dying or ceasing to act; or

(b) invalidating any provision in force on 1 January 1953 so long as any person then entitled to the benefit of that provision or who is afterwards given the benefit thereof under subsection (3) remains a trustee under the relevant deed; or

(c) depriving any person of any exemption or right to be indemnified in respect of anything done or omitted to be done by that person while any provision referred to in paragraph (b) was in force.

(3) So long as any trustee under a trust deed remains entitled to the benefit ofa provision saved by subsection (2)(b) or (c) the benefit of that provision may be given either -

(a) to all trustees under the deed, present and future; or

(b) to any named trustee or proposed trustee,

by a resolution passed by a majority of not less than three- fourths in value of the debenture holders present in person or by proxy at a meeting summoned for the purpose in accordance with the provisions of the deed or, if the deed makes no provision for summoning meetings, at a meeting summoned for the purpose in any manner approved by the Court.

Power to re-issue redeemed debentures in certain cases

131. (1) Where a company has redeemed any debentures previouslyissued, not being debentures convertible into shares of the company, it, unless -

(a) its articles or the conditions of issue of those debentures expressly otherwise provide; or

(b) the debentures have been redeemed in pursuance of any obligation on the part of the company to redeem them, not being an obligation enforceable only by the person to whom the redeemed debentures were issued or that person's successors in title,

has and is deemed at all times to have had power to keep the debentures alive for the purpose of re-issue.

No.3362 Government Gazette 30 December 2004 75 Act No. 28, 2004 COMPANIES ACT, 2004

(2) Where a company has purported to exercise the power referred to in subsection (1), it has and is deemed at all times to have had power to re- issue the debentures either by re-issuing the same debentures or by issuing other debentures in their place, and on that re-issue the person entitled to the debentures has and is deemed at all times to have had the same rights and priorities as if the debentures had not previously been issued.

(3) Where with the object of keeping debentures alive for the purpose of re-issue, they have been transferred to a nominee of the company, a transfer from that nominee is deemed to be a re-issue for the purposes of this section.

(4) Where a company had deposited any of its debentures to secure advances from time to time on current account or otherwise, the debentures are not deemed to have been redeemed because the account of the company has ceased to be in debit whilst the debentures remained so deposited.

(5) Nothing in this section prejudices any power reserved to a company by its debentures or securities, to issue debentures in the place of any debentures paid off or otherwise satisfied or extinguished.

Debenture to be described as secured or unsecured

132. A company must not issue a debenture, debenture certificate or prospectus relating to debentures unless the term "debenture" or some other term denoting a debenture used is qualified by the word "secured" or "unsecured", as the case may be.

Form of debentures or debenture certificates

133. (1) A company must not issues a debenture or debenture certificate unless the conditions of the debenture concerned are stated on the debenture or on the debenture certificate.

(2) Any debenture or debenture certificate must be signed by one director of the company and an officer of the company duly authorised by the directors and must, in the case where the debenture concerned is not a bearer debenture and in the case of a debenture certificate, specify the debentures, other than bearer debentures, of that company held by the person named in that debenture or debenture certificate.

(3) Any signature referred to in subsection (2) may be affixed to a debenture or debenture certificate by autographic or mechanical means.

(4) Any debenture or debenture certificate issued in terms of this section is sufficient evidence of the title of the person named in that debenture or certificate or, in the case of a bearer debenture, of the bearer of the debenture.

Register of pledges and bonds

134. Subject to section 136, every company must keep at its registered office a register of pledges, cessions, notarial bonds, mortgage bonds and notarial debentures and enter in that register all pledges, cessions, notarial bonds, mortgage bonds and notarial debentures affecting property of the company, giving in each case a short description of the property pledged, ceded or bound, the amount of the pledge, cession or bond and the names and addresses ofthe persons in whose favour any pledge, cession, bond or debenture was executed or to whom any pledge has been delivered.

Register of debenture holders

135. Subject to section 136, every company must keep at its registered office a register of debenture holders showing the number of debentures issued and outstanding

76 Government Gazette 30 December 2004 No.3362 Act No. 28, 2004 COMPANIES ACT, 2004

and whether or not they are payable to bearer and specifying the names and addresses of the holders, other than bearers.

Registers may be kept where made up

136. Section 117(2) and (4) relating to the keeping ofa register of members and access to that register does, with the necessary changes, apply to the registers required to be kept under sections 134 and 135.

Inspection of registers and copies and extracts

137. (1) Section 120 in so far as it relates to the inspection of the register of members does, with the necessary changes, apply to the registers to be kept under sections 134 and 135 and section 120(3) does, with the necessary changes, apply to the furnishing of a copy of a trust deed referred to in subsection (2).

(2) A copy of any trust deed for securing any issue of debentures must be transmitted to every holder of those debentures at that holder's request on payment of an amount equal to the cost of making that copy or a lesser amount as the company may determine.

Failure to keep registers

138. Any company which or any agent referred to in section 117(2), as applied by section 136, who fails to comply with section l34, l35 or 136, commits an offence and is liable to a fine which does not exceed N$800.

Part 6 Forgery of Certificates as to Shares, Debentures and other Securities

Forgery, impersonation and unlawful engravings

139. Any person who -

(a) with intent to defraud, forges, offers, utters or disposes of, knowing it to be forged or altered, any certificate as to shares, debentures or other securities as defined in section 141, any broker's transfer form, certified broker's form, share warrant or coupon issued in pursuance of this Act;

(b) by means of any forged certificate, form, share warrant, coupon or other document, knowing it to be forged or altered, obtains or receives or endeavours to obtain or to receive any interest in any company or obtains or receives or endeavours to obtain or to receive any benefit, dividend or money payable in that respect;

(c) by impersonating any owner of any interest in any company, including any share warrant or coupon issued in pursuance of this Act, obtains or endeavours to obtain any interest or share warrant or coupon or receives or endeavours to receive any benefit or money due to that owner, as if he or she were the true and lawful owner; or

(d) without lawful authority or excuse -

(i) engraves or makes on any plate, wood, stone, or other material any certificate as to any interest in a company or any share warrant or coupon or document purporting to be any interest, share warrant or coupon issued or made by any particular company in pursuance of this Act or to be a blank certificate, share warrant or coupon so issued r.r "...