Singapore legislation
Clause 259
Clause 259
Allotment of shares and debentures where prospectus indicates application to list on securities exchange
(1)
Where a prospectus states or implies that application has been or will be made for permission for the shares or debentures, or units of shares or debentures offered thereby to be listed for quotation on the official list of any securities exchange, and —
the permission is not applied for in the form required by the securities exchange within 3 days from the date of the issue of the prospectus; or
the permission is not granted before the expiration of 6 weeks from the date of the issue of the prospectus or such longer period not exceeding 12 weeks from the date of the issue as is, within those 6 weeks, notified to the applicant by or on behalf of the securities exchange,then —
any allotment whenever made of shares or debentures, or units of shares or debentures, made on an application in pursuance of the prospectus shall, subject to subsection (3), be void; and
any person who continues to allot such shares or debentures, or units of shares or debentures, after the period specified in paragraph (a) or (b), shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $150,000 or to imprisonment for a term not exceeding 2 years or to both and, in the case of a continuing offence, to a further fine not exceeding $15,000 for every day or part thereof during which the offence continues after conviction.
(2)
Where the permission has not been applied for, or has not been granted as mentioned under subsection (1), the corporation shall, subject to subsection (3), immediately repay without interest all moneys received from applicants in pursuance of the prospectus, and if any such moneys is not repaid within 14 days after the corporation so becomes liable to repay it then, in addition to the liability of the corporation, the directors of the corporation shall be jointly and severally liable to repay that money with interest at the rate of 10% per annum from the expiration of such 14 days.
(3)
Where in relation to any shares in or debentures of, or units of shares in or debentures of, a corporation —
permission is not applied for as specified in subsection (1)(a); or
permission is not granted as specified in subsection (1)(b),the Authority may, on the application of the corporation made before any share or debenture, or unit of share or debenture, is purported to be allotted, exempt the allotment of the shares or debentures, or units of shares or debentures, from the provisions of this section.
(4)
A director shall not be liable under subsection (2) if he proves that the default in the repayment of the money was not due to any misconduct or negligence on his part.
(5)
Any condition requiring or binding any applicant for shares or debentures, or units of shares or debentures, to waive compliance with any requirement of this section or purporting to do so shall be void.
(6)
Without limiting the application of any of its provisions, this section shall have effect —
in relation to any shares or debentures , or units of shares or debentures agreed to be taken by a person underwriting an offer thereof contained in a prospectus as if he had applied therefor in pursuance of the prospectus; and
in relation to a prospectus offering shares or units of shares for sale as if —
a reference to sale were substituted for a reference to allotment;
the persons by whom the offer is made, and not the corporation were liable under subsection (2) to repay money received from applicants, and references to the corporation’s liability under that subsection were construed accordingly; and
for the reference in subsection (7) to the corporation and every officer of the corporation who is in default there were substituted a reference to any person by or through whom the offer is made and who knowingly and wilfully authorises or permits the default.
(7)
All moneys received under this section shall be kept in a separate bank account so long as the corporation may become liable to repay it under subsection (2); and if default is made in complying with this subsection, the corporation and every officer of the corporation who is in default shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $50,000 or to imprisonment for a term not exceeding 12 months or to both and, in the case of a continuing offence, to a further fine not exceeding $5,000 for every day or part thereof during which the offence continues after conviction.
(8)
Where the securities exchange has within the time specified in subsection (1)(b) granted permission subject to compliance with any requirements specified by the securities exchange, permission shall be deemed to have been granted by the securities exchange if the directors have given to the securities exchange an undertaking in writing to comply with the requirements of the securities exchange.
(9)
If any such undertaking referred to in subsection (8) is not complied with, each director who is in default shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $50,000 and, in the case of a continuing offence, to a further fine not exceeding $5,000 for every day or part thereof during which the offence continues after conviction.
(10)
A person shall not issue a prospectus inviting persons to subscribe for shares in or debentures of, or units of shares in or debentures of, a corporation if it includes —
a false or misleading statement that permission has been granted for those shares or debentures, or units of shares or debentures, to be dealt in or quoted on any securities exchange; or
any statement in any way referring to any such permission or to any application or intended application for any such permission, or to dealing in or quoting the shares or debentures, or units of shares or debentures, on any securities exchange, or to any requirements of a securities exchange unless that statement is or is to the effect that permission has been granted or that application has been or will be made to the securities exchange within 3 days from the date of the issue of the prospectus or the statement has been approved by the Authority for inclusion in the prospectus.
(11)
Any person who contravenes subsection (10) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $50,000 or to imprisonment for a term not exceeding 12 months or to both and, in the case of a continuing offence, to a further fine not exceeding $5,000 for every day or part thereof during which the offence continues after conviction.
(12)
Where a prospectus contains a statement to the effect that the memorandum and articles of the corporation comply or have been drawn so as to comply with the requirements of any securities exchange, the prospectus shall, unless the contrary intention appears from the prospectus, be deemed for the purposes of this section to imply that application has been, or will be, made for permission for the shares or debentures, or units of shares or debentures, to which the prospectus relates to be listed for quotation on the official list of the securities exchange.