THE CORPORATIONS LAW

CHAPTER 2J - TRANSACTIONS AFFECTING SHARE CAPITAL

PART 2J.3 - FINANCIAL ASSISTANCE

SECTION 260A   FINANCIAL ASSISTANCE BY A COMPANY FOR ACQUIRING SHARES IN THE COMPANY OR A HOLDING COMPANY  

260A(1)  [May assist in limited circumstances]  

A company may financially assist a person to acquire shares (or units of shares) in the company or a holding company of the company only if:

(a)  giving the assistance does not materially prejudice:

(i) the interests of the company or its shareholders; or
(ii) the company's ability to pay its creditors; or

(b)  the assistance is approved by shareholders under section 260B (that section also requires advance notice to ASIC); or

(c)  the assistance is exempted under section 260C.

260A(2)  [Timing of assistance]  

Without limiting subsection (1), financial assistance may:

(a)  be given before or after the acquisition of shares (or units of shares); and

(b)  take the form of paying a dividend.

260A(3)  [Mode of acquisition]  

Subsection (1) extends to the acquisition of shares (or units of shares) by:

(a)  issue; or

(b)  transfer; or

(c)  any other means.


 

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