Resolution - Disapplication of preemption rights – non pre-emptive share issues (specified capital investment/acquisition)

Question 1

CA

Answer 1

s. 561 - Existing SHs ordinarily have a right of pre- emption

S. 570(1) CA – Disapplication of pre-emption rights by SR

Question 2

PEG?

Answer 2

PEG statement of Principals 2A(3): company may seek authority for general disapplication of pre-emption rights of no more than 5% of its ISC

However, further 5% of its ISC in connection with an acquisition or specified capital investment. – NOTE: must be subject of a separate resolution to the general disapplication of pre-emption rights.

The restriction of 7.5% in three years does not apply

So in practice can use full 10% to fund acquisition or specified capital investment.

Question 3

LR?

Answer 3

LR 13.8.2R – disapplying pre-emption rights must include statement of:

• Maximum amount
  of shares which disapplication covers
• If general disapplication
  otherwise than to existing SH in proportion to existing holdings, % which amount generally disapplied represents OSC