66. Share warrants

Question 1

66. Share warrants

Answer 1

General overview

[66.01] Bearer shares are prohibited by this section.

Question 2

Bearer of share warrant

Answer 2

[66.02] Section 66 provides that a company shall not issue any share warrants stating that the bearer shall be entitled to the shares specified therein and which enable the shares to be transferred by delivery of the warrants. In other words, shares issued by a company incorporated in Singapore must be registered shares, not bearer shares. Bearers of a share warrant that have not exercised the warrant have not expressly or impliedly agree to become members and must be treated simply as contingent creditors in respect of their potential claims against the company

Question 3

Cancellation of share warrants

Answer 3

[66.03] Subsection (2) provides that the bearer of a share warrant issued before December 29, 1967, shall within two years after the commencement of Act No 36 of 2014, be entitled to surrender it for cancellation and to have his name registered in the register of members.

Question 4

Compensation for loss

Answer 4

[66.04] Subsection (3) provides that the company shall be liable for any loss incurred by any person as a result of the company registering the bearer as a member of the company in respect of the shares specified therein without the warrant being surrendered and cancelled.

[66.05] Any share warrant referred to in s 66(2) that is unaccounted for by the expiry of the two-year period shall be cancelled by the company and the company shall not be liable for any loss incurred by any person by reason of such cancellation.