Companies Act, 2017

Directors may sell or otherwise dispose of a forfeited share, and may cancel the forfeiture before a sale or disposition.

If a person's shares are forfeited, they stop being a member for those shares but still must pay the company the money owed on them, plus interest if the directors choose to enforce it.

A written statement saying the maker is a director or secretary, and that a share was duly forfeited on a stated date, is prima facie evidence of those facts against anyone claiming the share.

A company may receive consideration for a forfeited share, transfer the share, and must register the transferee as holder after the transfer is executed.

The company must use the consideration to pay the part of the lien amount that is presently payable, and pay any residue to the person who was entitled to the shares immediately before the transfer, subject to any earlier like lien.

These regulations on forfeiture apply when a sum payable at a fixed time on a share is not paid, and the sum is treated as if it were payable under a duly made and notified call.

A member may transfer shares in writing, but the transfer instrument must be in the prescribed form or another form approved by the directors, and it must be executed by or for both transferor and transferee.

A share transfer instrument must be lodged at the company’s registered office with any required fee, certificate, and other required information, and the company must then register the transferee as a shareholder.

Directors may refuse to register certain share transfers.

Directors may refuse to register a transfer if it is not accompanied by the appropriate share certificate, except where the company has not yet issued the certificate or must issue a renewal or copy.

Directors may suspend registration of transfers, but only for periods they determine and only up to 30 days in total in any year.

When a member dies, the company must recognise the surviving joint holder or the deceased member’s personal representatives as the person entitled to the shares, depending on how the shares were held.

A person who becomes entitled to a share because of a member’s death or bankruptcy may choose to be registered as the holder or to have another person registered as transferee, but must give the required written notice or execute the transfer if that choice is made.

If a registered shareholder dies or becomes bankrupt, their personal representatives or estate assignee can receive the same dividends and rights, once directors’ required information is produced.

The company may resolve to convert paid up shares into stock, and stock back into paid up shares of any nominal value.

If shares have been converted into stock, the share-transfer rules apply to that stock as far as they can. Directors may set the minimum transferable stock amount and may block transfers of smaller fractions, but the minimum cannot be higher than the aggregate nominal value of the shares that created the stock.

Holders of stock are entitled to the same rights, privileges, and advantages, in proportion to the amount of stock held, as if they held the shares from which the stock arose.

Rules for paid-up shares also apply to stock, and references to shares and shareholders are to be read as including stock and stockholders.

A company may increase its authorised share capital by resolution, including by creating new shares, consolidating or subdividing shares, or cancelling certain shares.

Before issuing unissued shares, the company must first offer them to eligible shareholders; if the offer is declined or the period expires, directors may issue the shares.

The company may reduce its share capital, capital redemption reserve fund, or share premium account if it follows the Act and passes a special resolution.

Directors may convene a general meeting whenever they think fit. If no director is present in Zambia, any two members may convene the meeting. General meetings must be held in Zambia unless all members entitled to vote agree in writing to hold one outside Zambia.

A notice for a general meeting must state the place, day, hour, and usually the general nature of the business. For an annual general meeting, it does not need to list certain routine matters.

A general meeting may not proceed with business unless a quorum of members is present.

If no quorum is present within 30 minutes of the appointed meeting time, the meeting is dissolved or adjourned depending on how it was called.

If directors choose a chairman, that person must preside at every general meeting. If no chairman is elected, or the chairman is absent or unwilling to act, the members present must elect a chairman for the meeting.

The chairman may, and in some cases must, adjourn a meeting, but only with a quorum present and subject to the meeting’s direction or consent.

At a general meeting, voting is by show of hands unless a poll is demanded in time by the chairman or qualifying members; a poll demand can also be withdrawn.

If a poll is duly demanded, the chairman controls how it is taken, except that certain polls must be taken immediately.

If votes are tied, the chairman of the meeting has a casting vote.

Certain shareholders and related persons may vote at member meetings, with one vote on a show of hands and votes on a poll.

For joint holders, the senior holder’s vote is accepted, and the other joint holders’ votes are excluded.

If a member is of unsound mind or subject to mental health law, the member’s committee, assignee, or other estate manager may exercise the member’s rights for a general meeting.

A member may vote at a general meeting only if all polls and other sums currently payable on the member’s shares have been paid.

A challenge to a voter’s qualification can be made only at the meeting or adjourned meeting where that vote is given or tendered, and the chairman’s decision on the challenge is final.

A proxy appointment must be in writing and properly signed; it may set how the proxy votes, and it is taken to authorize demanding a poll.

A proxy appointment is invalid unless the proxy instrument and any supporting authority are deposited on time.

A vote cast under a proxy or power of attorney stays valid even if the principal has died, lost mental capacity, revoked the instrument or power, or transferred the share, unless the company received written notice before the meeting starts.

The company may fix a share qualification for directors by ordinary resolution; until it does, there is no share qualification.

A director’s office becomes vacant if the director makes an arrangement or composition with creditors generally.

Directors may borrow money and give security for company debts, but only subject to sub-regulation (2).

A company may suspend or relax section 107, including for a specific transaction, by company resolution.

A director may appoint an alternate director only if the other directors approve. An alternate director is entitled to notice of directors’ meetings and may exercise the appointing director’s powers if the appointment instrument allows it.

A directors’ meeting has a quorum of two, unless the company sets a larger number by resolution.

If there is a director vacancy, the remaining directors may act; if they do not make a quorum, they may act only to add directors or call a general meeting.

Directors must choose one of their number to chair their meetings, and they may set how long that person serves.

Directors may delegate powers to a committee, and committee meetings have rules for choosing a chairman, voting, and casting votes.

The directors may appoint an executive director and give that person some of their powers, and they may later withdraw or change those powers.

Directors may appoint and remove an associate director, set that person’s powers, duties, and remuneration, and the appointee generally has no right to attend or vote at directors’ meetings unless invited and consented to by the directors.

A company secretary must hold office on the terms and conditions set by the directors.

Directors must keep the company seal in safe custody and control its use.

Directors decide when and on what terms company records and documents may be opened to inspection by members other than directors; such members have no right to inspect unless the law, directors, or a company resolution allows it.

A company may declare a dividend only if the directors have recommended one, and the dividend cannot be higher than the recommended amount.

Directors may authorise the company to pay interim dividends to members if the directors think the dividends are justified by the company’s profits.

The company must not pay interest in respect of any dividend.

A dividend must not be paid unless it comes out of the company’s profits.

Directors may set aside reserves from profits before recommending a dividend, use or invest those reserves while pending, and carry forward profits they do not want to distribute as dividends.

Dividends must be declared and paid based on the amounts paid or credited as paid on the relevant shares, subject to any special dividend rights.

Directors may deduct money owed to the company from a member’s dividend.

If a company declares a dividend, it may resolve to pay it in whole or part with specific assets instead of cash. If that causes difficulty, the directors may settle the distribution details, issue fractional certificates, set asset values, make cash adjustments, and vest assets in assignees.

Dividends, interest, or other cash payable on shares may be paid by cheque sent through the post to the registered address, or another address directed in writing.

The company may do something, but only subject to sub-regulation (2).

A company cannot pass a capitalisation resolution unless the directors recommend it; the directors must also do what is needed to carry it out.

If the company is wound up, the liquidator may, with special resolution approval, distribute company property among members or transfer it to assignees on trusts for contributories.

The company must indemnify its officers, auditors, or agents for qualifying liabilities connected with defending civil or criminal proceedings or related applications.

The provided text appears to be a section heading for “Indemnity Inspection of Accounts and List of members,” but it does not include a substantive rule.

This section defines “Articles,” “The Office,” and “The Seal,” and says terms in these regulations have the same meaning as in the Act unless the context requires otherwise.

Subscribers to the incorporation application, and others admitted under the articles, are members of the company. A person cannot be admitted as a member unless the company resolves to admit them and they sign and deliver a declaration of guarantee.

A member may withdraw from the company at any time, but must give at least seven days’ written notice.

General meetings that are not annual general meetings are to be called extraordinary general meetings.

Directors may call a general meeting when they think it is necessary, and must convene an extraordinary general meeting after a member requisition within six weeks. If there are not enough directors present in Zambia, one director or two members may convene the meeting instead.

A general meeting must be held in Zambia unless all members entitled to vote agree in writing to hold it outside Zambia.

Certain company meetings must be called with at least 21 days’ notice, while all other general meetings need at least 14 days’ notice unless all members entitled to attend and vote agree to shorter notice.

A notice for a general meeting must state the date, place, hour, and general nature of the business. If it is an annual general meeting, the notice must say so.

An accidental failure to give meeting notice, or a person’s failure to receive it, does not invalidate the meeting’s proceedings.

Business cannot be transacted at a general meeting unless a quorum of members is present when the meeting begins business.

If no quorum is present within half an hour after the appointed meeting time, the meeting is dissolved in requisitioned meetings or adjourned in other cases; at the adjourned meeting, two members make a quorum, otherwise the meeting is dissolved.

If the directors choose a chairman, that person must preside at general meetings. If no chairman has been elected, or the chairman is absent after fifteen minutes or unwilling to act, the members present must choose a chairman.

The chairman may adjourn a meeting with the meeting’s consent when a quorum is present, and must adjourn it if the meeting directs. At an adjourned meeting, only unfinished business from the earlier meeting may be transacted. If the adjournment lasts 30 days or more, notice of the adjourned meeting must be given as for an original meeting.

At a general meeting, resolutions are decided by show of hands unless a poll is demanded in time by the chairman, at least three members, or members holding at least one tenth of voting rights.

If a poll is properly demanded, the chairman directs how it is taken. A poll demanded on electing the chairman or on adjournment must be taken immediately.

If votes are tied on a show of hands or a poll, the chairman of the meeting has a casting vote.

At a members’ meeting, each registered member, proxy, or attorney of a non-present member is entitled to vote, subject to any current rights or restrictions.

People present and entitled to vote get one vote on a show of hands, and a vote on a poll in line with section 67.

Objections to a voter’s qualification may be raised only at the relevant meeting, and the chairman’s decision on the objection is final. A proxy may be told how to vote on a resolution, and then may vote only as specified.

A proxy appointment is invalid unless the required instrument and supporting authority (or certified copy) are deposited on time and at the specified place.

A vote cast under a proxy or power of attorney stays valid even if the principal later dies, loses capacity, or revokes the proxy or power, unless the company received written notice before the meeting starts.

A director’s office becomes vacant if the director makes any general arrangement or composition with creditors, in addition to other vacancy circumstances under the Act.

The board of directors may use the company’s powers to borrow money, charge company property or business, and issue debentures or other security for debts, liabilities, or obligations.

Directors manage the company’s affairs and may pay registration expenses and use company powers that are not reserved to a general meeting.

The board may appoint one or more attorneys for the company by power of attorney.

The company may, by resolution, suspend or relax section 107 rules about a materially interested director not counting in quorum or voting.

A director may appoint an alternate director if the others approve, and the alternate director may exercise the appointer’s powers subject to the appointment instrument.

Director meetings need a quorum of two, unless the company sets a larger number by resolution. If there is a vacancy on the board, the remaining director(s) may act, but only in limited ways if they cannot make a quorum.

Directors may delegate powers to committees, committee members may choose a chairman, and meetings are decided by majority vote with a casting vote for the chairman if votes are equal.

The board of directors may appoint an executive director and give that person some board powers, subject to the Act and any terms, restrictions, or conditions the board considers necessary.

Directors are entitled to remuneration set by ordinary resolution of the company, and it is treated as accumulating day to day unless the resolution says otherwise.

Directors may be reimbursed for properly incurred travelling, hotel, and other expenses linked to meetings or their duties.

The company secretary must hold office on terms and conditions, including remuneration, set by the board.

The board must have minutes recorded in books kept for that purpose.

The board must provide for safe custody of the company seal, and the seal may be used only with board authority or authority of a board-authorized committee. Documents with the seal must be signed and counter-signed as stated.

The board controls when and how company accounting records and other documents may be inspected by members who are not directors. Those members generally do not have a right to inspect company documents unless the law, the board, or a company resolution allows it.

An officer, auditor, or agent of the company is entitled to be indemnified from company property for liability incurred while defending proceedings, if the court grants relief under the Act.

The subscribers say they want to form a company limited by guarantee and commit to how property and debts will be handled if the company is wound up.

This Schedule defines “company” and “proposed subsidiary.”

A prospectus must state at its head that a copy has been delivered to the Registrar of Companies for registration, and that the Registrar has not checked the statements and accepts no responsibility for them, the company’s financial soundness, or the value of the securities.

A prospectus report for this Schedule must be made by a suitably qualified person eligible to be appointed as the company’s auditor.

If the reports would not otherwise give a true and fair view, the people preparing them must add information and explanations.

If required report information is unavailable for reasons beyond the company’s control, the company must state that fact and explain why.

Public offers of securities must include a full description of the securities and the terms of the offer; unsecured debentures must be described as “unsecured.”

The provision says to state whether an application has been made, or is being made, to a stock exchange for permission to deal in the securities, and then give the stock exchange name or say there will be no market for the securities.

Each person making the invitation, other than the company, must provide their full name, addresses, and business occupation.

This section states that the company’s registered office and postal address are to be identified.

Lists the information that must be provided for each director, proposed director, secretary, and proposed secretary, including names, addresses, occupation, and other directorships.

This provision refers to the names, addresses, and professional qualifications of a company’s auditors, except for a proposed company.

The invitation must state the name and address of any underwriter.

This section lists the company’s bankers, stockbrokers, and legal practitioners by name and address.

If an invitation concerns debentures, it must include trustee names and addresses, the date of the resolutions creating the debentures, and brief details of the security; if unsecured, it must say so.

The provision refers to the company’s business or businesses, or—if it has none—its principal objects.

The company’s articles may contain restrictions on the business of the company.

This section is a heading indicating a brief summary of the company's history.

The provision refers to listing key details about the company’s subsidiaries and certain other bodies corporate in which it holds more than 25% of voting equity shares.

If a company is a subsidiary, it must state details about each holding company and, for holding companies that are members, the shares they hold in each class.

This provision refers to the name, country of incorporation, and nature of business of a proposed subsidiary of the company.

If a company is proposing to acquire a business, it must provide a full description of that business’s nature.

This section concerns information about the main places of business of the company and its subsidiaries and proposed subsidiaries.

A statement must cover the company's financial and trading prospects, any material information relevant to those prospects, and any material changes in its financial or trading position since the end of the last completed financial year.

Directors must provide a statement about whether the company’s working capital is sufficient, or explain how extra working capital will be provided if it is not.

This provision refers to the amount or estimated amount of expenses incidental and preliminary to an invitation, including any stock exchange application expenses, and who must pay those expenses.

This provision refers to particulars of commissions payable or paid within the previous two years for acquiring company or subsidiary shares or debentures.

If a company invites the public to subscribe for shares or debentures, it must disclose the proceeds, how they will be used, and the funding amounts and sources for listed issue-related matters.

If someone other than the company invites the public to buy the company’s shares or debentures, that person must give specific price or consideration statements depending on how the securities were issued or acquired.

This section mentions a company’s authorised capital and its authorised and issued shares by class.

The provision distinguishes the amount paid on issued shares of each class between cash and non-cash payment.

It refers to the amount still payable on previously issued shares of each class, split into what is due now and what is not yet due.

The provision requires the number of unissued shares for each class, and the amounts payable for them, to be stated separately for cash and non-cash payment.

If a company’s shares are divided into classes, the provision refers to the rights attached to each class and the consents needed to change those rights.

A company’s prospectus must state dividend amounts per share for the relevant years and note any years with no dividends.

If the company has redeemable preference shares, it has power to redeem them only from the earliest date allowed.

It refers to the name of each person who holds more than 25% of the company’s shares, or shares of any class, and the number and description of those shares.

The provision requires identifying the beneficial owner of the company’s shares and recording the number and description of those shares.

States that the amount of outstanding debentures issued or agreed to be issued by the company and relevant subsidiaries should be given, or a statement that none exist.

The provision requires particulars of any bank overdrafts of the company, its subsidiaries, and proposed subsidiaries to be given, stated as at the latest practical date; if there are none, a statement saying so must be provided.

This section refers to the nature of the consideration for company shares or debentures issued, or proposed to be issued, other than for cash.

The prospectus must include particulars about certain shares or debentures of the company’s subsidiaries and proposed subsidiaries.

The prospectus must state certain details about shares or debentures issued or to be issued for cash.

The provision requires details about company shares or debentures that are under option or conditionally or unconditionally agreed to be put option, including the price, duration, consideration, and either a statement for all-holders/employee-wide options or the name and address of each grantee.

The provision sets out what information must be disclosed about property acquired or proposed to be acquired by a company or its subsidiaries, and it creates exceptions for certain older or ordinary-course contracts.

If less than two years have passed since a company was registered, certain details about expenses, promoters, payments or benefits to promoters, and directors’ interests must be provided.

If a prospectus includes a statement said to be made by an expert, it must also state that the expert gave written consent to publication and has not withdrawn that consent, in the form and context shown.

Material contracts must be described by their dates, parties, and general nature, except for contracts made in the ordinary course of business or completed more than two years before the prospectus publication date.

Certain company documents must be made available for inspection for at least 28 days, and some non-English material must be provided as certified English translations.

The prospectus must set out reports required under this Schedule, including the names and addresses of the persons making them.

The company must include a profits-or-losses report in the prospectus covering specified financial years, and if it has subsidiaries, also the subsidiaries’ attributable profits or losses.

The provision requires a report on the company’s assets and liabilities, measured either at the end of the last financial year or, in some cases, at a later practicable date before the prospectus is published.

The provision describes a report on directors’ aggregate emoluments and any difference from amounts payable under arrangements in force when the prospectus was published.

A prospectus report must cover specified profits or losses for proposed subsidiaries, acquired businesses, and certain subsidiaries over the relevant periods.

The report must cover assets and liabilities for each proposed subsidiary and each acquired business or subsidiary, using the relevant financial-year date or a date within 90 days before the prospectus if needed.

The section refers to reports that may cover other matters the report-makers consider relevant to the reports’ purpose.

People already in office when the Act starts stay in office, but they must meet the Act’s requirements within two years.

Acts done under the repealed Act that were already in force at commencement are treated as if done under this Act.

Existing companies, their boards, and the Registrar have specific powers and limits about articles of association, share issues, and replacement certificates; non-compliance can be an offence.

Proceedings that started and were still pending before this Act began are to continue as though they had started under this Act.

Records, funds, or accounts kept under the repealed Act for company organisation are treated as part of the records, funds, or accounts under this Act.

A company registered under the repealed Act is treated as registered under this Act, and this Act applies to it.

Fees, charges, or sums paid or unpaid before this Act started are to be treated under this Act.

Existing approvals, authorisations, and acts done under the repealed Act are treated as valid under this Act.