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Prospectus of a Company

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HomeBrud.gifCompany LawBrud.gifProspectus of a Company

The Prospectus issued or published by or on-behalf a Company or a Corporation, is a circular (document) to induce the public to subscribe for the shares or debentures of the company.

It is a brief, legal document formulated in a simple style and used to present to potential investors all important information about a given company (issue of securities, investment offering, etc) in relation to its . This document must be prepared by the company which files it with and gets it approved by the securities commission before the company may issue shares or debt to the public.

A prospectus is also usually published on the issue, in England, of bonds or other securities by a foreign state or corporation.

In general, the Promoter of a Company is the person who files the prospectus of the company.

Types of Prospectus

  • Red-herring Prospectus
  • Pink-herring Prospectus
  • Free-writing Prospectus
  • Abridged Prospectus
  • Reconfirmation Prospectus

Provisions related Company Prospectus

Kenyan Company Law

  • Section 39: Dating of Prospectus.
  • Section 40: Matters to Be Stated and Reports to Be Set out in Prospectus.
  • Section 41: Provisions of Section 40 Not to Limit any Other Liability.
  • Section 42: Expert's Consent to Issue of Prospectus Containing Statement by Him.
  • Section 43: Registration of Prospectus.
  • Section 44: Restriction on Alteration of Terms Mentioned in Prospectus or Statement in Lieu of Prospectus.
  • Section 45: Civil Liability for Mis-statements in Prospectus.
  • Section 46: Criminal Liability for Mis-statements in Prospectus.
  • Section 47: Document Containing Offer of Shares or Debentures for Sale to Be Deemed Prospectus.
  • Section 48: Interpretation of Provisions Relating to Prospectuses.

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