Forfeiture of shares based on refusal of members to respond to call on shares
Where a member fails to pay any call or installment of a call on the day appointed for payment, the directors are required to serve a notice on such member requesting the payment and the accrued interest. If the member does not respond within 14days to such notice he shall forfeit his shares.
The forfeiture of such shares shall be effected by a resolution passed by the directors of the company. A forfeited share may be sold or otherwise disposed of on such terms or in any manner as the directors think fit. The forfeiture may be cancelled on whatever terms as the director may deem fit and the proceeds given to the company. A transfer of shares will be executed and registered in the name of the new holders of the then forfeited shares.
Once a member is affected by the forfeiture of his shares he ceases to be a member of the company, however he shall still be liable to pay the company all monies that he was meant to pay before the forfeiture and his liability to the company ceases after he has made full payment of what he owes the company in respect of the shares.
A statutory declaration shall be prepared to state that declarant is a director or the secretary of the company, and that a share in the company has been duly forfeited on a date stated in the declarations, shall be prima facie evidence to show that such share was forfeited.
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