Part 18Acquisition by limited company of its own shares

Chapter 2Financial assistance for purchase of own shares

Exceptions from prohibition

681Unconditional exceptions

1

Neither section 678 nor section 679 prohibits a transaction to which this section applies.

2

Those transactions are—

a

a distribution of the company’s assets by way of—

i

dividend lawfully made, or

ii

distribution in the course of a company’s winding up;

b

an allotment of bonus shares;

c

a reduction of capital under Chapter 10 of Part 17;

d

a redemption of shares under Chapter 3 or a purchase of shares under Chapter 4 of this Part;

e

anything done in pursuance of an order of the court under Part 26 (order sanctioning compromise or arrangement with members or creditors);

f

anything done under an arrangement made in pursuance of section 110 of the Insolvency Act 1986 (c. 45) or Article 96 of the Insolvency (Northern Ireland) Order 1989 (S.I. 1989/2405 (N.I. 19)) (liquidator in winding up accepting shares as consideration for sale of company’s property);

g

anything done under an arrangement made between a company and its creditors that is binding on the creditors by virtue of Part 1 of the Insolvency Act 1986 or Part 2 of the Insolvency (Northern Ireland) Order 1989 (S.I. 1989/2405 (N.I. 19)).