Section 83. Forfeiture of shares

(1) If a shareholder fails to pay any call or instalment of a call within the stipulated time, the directors may serve a notice on the shareholder requiring payment of the amount unpaid together with any interest or compensation which may have accrued.

(2) The notice in subsection (1) shall—

(a) specify a date on or before which the payment is required to be made; and

(b) state that in the event of non-payment on or before the specified date, the shares in respect of which the call was made is liable to be forfeited.

(3) Upon failure to comply with the notice served under subsection (1), the share in respect of which the notice has been given shall be forfeited by a resolution of the directors unless the payment as required by the notice has been made before such resolution.

(4) For the purposes of subsection (3), the forfeiture shall include all dividends declared in respect of the forfeited shares and not actually paid before the forfeiture.

(5) A person whose shares have been forfeited under subsection (3) shall cease to be a member in respect of the forfeited shares.

(6) Notwithstanding subsection (5), the person shall remain liable to pay to the company all money which at the date of forfeiture was payable by him to the company in respect of the shares together with interest or compensation at the rate of eight per centum per annum from the date of the forfeiture on the money for the time being unpaid if the directors think fit to enforce payment of the interest or compensation, and the liability shall cease if and when the company receives payment in full of all such money in respect of the shares.

(7) A statutory declaration in writing by a director or secretary that a share in the company has been duly forfeited on a date stated in the declaration shall be conclusive evidence of the facts stated in the declaration against all persons claiming to be entitled to the share.

(8) A forfeited share may be sold or otherwise disposed of on such terms and in such manner as the directors think fit.

(9) The company may receive the consideration, if any, given for a forfeited share on any sale or disposition of the share and may execute a transfer of the share in favour of the person to whom the share is sold or disposed of and such person shall—

(a) be registered as the shareholder; and

(b) not have his title to the share be affected by any irregularity or invalidity in the proceedings in reference to the forfeiture, sale or disposal of the share.

(10) The forfeiture may be cancelled on such terms as the directors think fit at any time before a sale or disposition of the forfeited shares.

(11) This section shall apply in the case of non-payment of any sum which, by the terms of issue of a share, becomes payable to the company at a fixed date, as if the shares had been payable by virtue of a call duly made and notified.