Section 72. Preference shares

(1) Subject to its constitution, a company having a share capital may issue preference shares.

(2) Subject to this section and if authorized by its constitution, a company may issue preference shares which are liable, or at the option of the company are to be liable, to be redeemed in accordance with the constitution.

(3) The redemption of the preference shares shall not be taken as reducing the amount of share capital of the company.

(4) The shares shall be redeemable only if the shares are fully paid up and the redemption shall be out of—

(a) profits;

(b) a fresh issue of shares; or

(c) capital of the company.

(5) Where any such shares are redeemed otherwise than out of the proceeds of a fresh issue, there shall, out of profits which would otherwise have been available for dividend, be transferred into the share capital accounts of the company, a sum equal to the amount of the shares redeemed.

(6) The redemption of shares out of the capital referred to in paragraph (4)(c) shall only be redeemed subject to the following:

(a) all the directors have made a solvency statement under section 113 in relation to such redemption; and

(b) the company has lodged a copy of the solvency statement with the Registrar.

(7) The company shall give notice to the Registrar specifying the shares redeemed within fourteen days from the redemption.