THE BAHAMAS THE INTERNATIONAL BUSINESS COMPANIES ACT, 2000

PART V DIRECTORS, OFFICERS, AGENTS AND LIQUIDATORS

40.        Subject to any limitations in its Memorandum or Articles or in any unanimous shareholder agreement, the business and affairs of a company incorporated under this Act shall be managed by a board of directors that consists of two or more persons who may be individuals or companies.

41.

(1)   All the shareholders of a company among themselves or all the shareholders of a company and a person who is not a shareholder of a company, may by a written agreement restrict in whole or in part, the powers of the directors of the company to manage the business and affairs of the company, and any such agreement if not otherwise invalid, shall be valid.

(2)   A shareholder who is a party to any unanimous shareholder agreement has all the rights, powers and duties and incurs all the liabilities of a director of the company to which the agreement relates, to the extent that the agreement restricts the discretion or powers of the directors to manage the business and affairs of the company; and the directors are hereby relieved of their duties and liabilities to the same extent.

(3)   If a person who is the beneficial owner of all the issued shares of a company makes a written declaration that restricts in whole or in part the powers of the directors to manage the business and affairs of the company, the declaration shall constitute a unanimous shareholder agreement.

(4)   Where any unanimous shareholder agreement is executed or terminated, written notice of that fact, together with the date of the execution or termination thereof, shall be filed with the Registrar within 15 days after the execution or termination and no such agreement shall be legally effective until notice of its execution shall have been filed as aforesaid.

(5)   In this section "shareholder" includes "member".

42.

(1) The first directors of a company incorporated under this Act shall be elected by the subscribers to the Memorandum; and thereafter, the directors shall be elected by the members for such term as the members may determine and where permitted by the Memorandum or Articles of a company incorporated under this Act, the directors may also elect directors for such term as the directors may determine.

(2)   Each director holds office until his successor takes office or until his earlier death, resignation or removal or in the case of a company upon the making of an order for the winding up or dissolution of the company or upon the removal of a defunct company by the Registrar otherwise than pursuant to a winding–up order.

(3)   Subject to any limitations in the Memorandum or Articles or in any unanimous shareholder agreement —

(a)    a director shall cease to hold the office of director if a majority requests his resignation in writing;

(b)   a director may resign his office by giving written notice of his resignation to the company and the resignation has effect from the date the notice is received by the company or from such later date as may be specified in the notice.

(4)   Subject to any limitations in the Memorandum or Articles or in any unanimous shareholder agreement, a vacancy in the board of directors may be filled by a resolution of members or of a majority of the remaining directors.

43.        The number of directors shall be fixed by the Articles and, subject to any limitations in the Memorandum or Articles, the Articles may be amended to change the number of directors.

44. (1)    A company incorporated under this Act shall keep a register to be known as a register of directors and officers containing-

(a) the names and addresses of the persons who are directors and officers of the company;

(b)the date on which each person whose name is entered in the register was appointed as a director or officer of the company; and

(c) the date on which each person as a director or officer ceased to be a director or officer of the company.

(2)   The register of directors and officers may be in such form as the directors approve, but if it is in magnetic, electronic or other data storage form, the company must be able to produce legible evidence of its contents.

(3)   The register of directors and officers, commencing from the date of the registration of the company, shall be kept at the registered office of the company referred to in section 37.

(4)   A copy of the register of directors and officers shall be filed with the Registrar and shall be open to inspection by members of the public during official hours.

(5)   The register of directors and officers is prima facie evidence of any matters directed or authorised by this Act to be contain therein.

45.         The directors shall have all the powers of the company that are not reserved to the members under this Act or in the Memorandum or Articles or in any unanimous shareholder agreement.

46.         Subject to any limitations in the Memorandum or Articles or in any unanimous shareholder agreement, the directors may, by a resolution of directors fix the emoluments of directors in respect of services to be rendered in any capacity to the company.

47.

(1)   The directors may, by a resolution of directors designate one or more Committees, each consisting of one or more directors.

(2)    Subject to any limitations in the Memorandum or Articles or in any unanimous shareholder agreement, each Committee has such powers and authority of the directors, including the power and authority to affix the common seal of the company, as are set forth in the resolution of directors establishing the Committee, except that no Committee has any power or authority with respect to the matters requiring a resolution of directors under section 42 or 53.

48.

(1)   Subject to any limitations in the Memorandum or Articles or in an unanimous shareholder agreement, the directors of a company incorporated under this Act may meet at such times and in such manner and places within or outside The Bahamas as the directors may determine to be necessary or desirable.

(2)   A director shall be deemed to be present at a meeting of directors if—

(a)    he participates by telephone or other electronic means; and

(b)   all directors participating in the meeting are able to hear each other and recognise each other's voice and for this purpose participation constitutes prima facie proof of recognition.

49.

(1)   Subject to a requirement in the Memorandum or Articles or in any unanimous shareholder agreement to give longer notice, a director shall be given not less than 2 days notice of meetings of directors.

(2)   Notwithstanding subsection (1) but subject to any limitations in the Memorandum or Articles or in any unanimous shareholder agreement, a meeting of directors held in contravention of that subsection, is valid if all the directors, or such majority thereof as may be specified in the Memorandum or Articles or in any unanimous shareholder agreement entitled to vote at the meeting, have waived the notice of the meeting; and for this purpose, the presence of a director at the meeting shall be deemed to constitute waiver on his part.

(3)   The inadvertent failure to give notice of a meeting to a director, or the fact that a director has not received the notice, does not invalidate the meeting.

50.         The quorum for a meeting of directors is that fixed by the Memorandum or Articles.

51.         Subject to any limitations in the Memorandum or Articles or in any unanimous shareholder agreement, an action that may be taken by the directors or a Committee of directors at a meeting may also be taken by a resolution of directors or a Committee of directors consented to in writing or by telex, telefax, telegram, cable or other written electronic communication, without the need for any notice.

52.

(1)   Subject to any limitations in the Memorandum or Articles or in any unanimous shareholder agreement, a director may by a written instrument appoint an alternate who need not be a director and the name of such alternate shall be disclosed and notified to the Registrar.

(2)   An alternate for a director appointed under subsection (1) shall be entitled to attend meetings in the absence of the director who appointed him and to vote or consent in the place of the director.

52A. Where there is a single director or a single shareholder of a company incorporated under this Act, any requirement in this Act or in the Articles for a meeting of directors or shareholders for any purpose shall be satisfied where such single director or single shareholder passes a resolution in lieu of such meeting.

53.

(1)   The directors may, by a resolution of directors appoint any person, including a person who is a director, to be an officer or agent of the company.

(2)    Subject to any limitations in the Memorandum or Articles or in any unanimous shareholder agreement, each officer or agent has such powers and authority of the directors, including the power and authority to affix the common seal of the company, as are set forth in the Articles or in any unanimous shareholder agreement or in the resolution of directors appointing the officer or agent, except that no officer or agent has any power or authority with respect to the matters requiring a resolution of directors under section 46 and this section.

(3)    The directors may remove an officer or agent appointed under subsection (1) and may revoke or vary a power conferred on him under subsection (2).

54.         Every director, officer, agent and liquidator of a company incorporated under this Act, in performing his functions, shall act honestly and in good faith with a view to the best interests of the company and exercise the care, diligence and skill that a reasonably prudent person would exercise in comparable circumstances.

55.         Every director, officer, agent and liquidator of a company incorporated under this Act, in performing his functions, is entitled to rely upon the Share Register kept under section 29, the books of accounts and records and the minutes and copies of consents to resolutions kept under section 66 and any report made to the company by any other director, officer, agent or liquidator or by any person selected by the company to make the report.

56.

(1)   Subject to any limitations in the Memorandum or Articles or in any unanimous shareholder agreement, if the requirements of subsection (2) are satisfied, no agreement or transaction between

(a)    a company incorporated under this Act; and

(b)   one or more of its directors or liquidators, or any person in which any director or liquidator has a financial interest or to whom any director or liquidator is related, including as a director or liquidator of that other person,

is void or voidable for this reason only or by reason only that the director or liquidator is present at the meeting of directors or liquidators, or at the meeting of the Committee of directors or liquidators, that approves the agreement or transaction or that the vote or consent of the director or liquidator is counted for that purpose.

(2)   An agreement or transaction referred to in subsection (1) is valid if ––

(a)    the material facts of the interest of each director or liquidator in the agreement or transaction and his interest in or relationship to any other party to the agreement or transaction are disclosed in good faith or are known by the members entitled to vote at a meeting of members; and

(b)   the agreement or transaction is approved or ratified by a resolution of members.

(3) Subject to any limitations in the Memorandum or Articles or in any unanimous shareholder agreement, a director or liquidator who has an interest in any particular business to be considered at a meeting of directors, liquidators or members may be counted for purposes of determining whether the meeting is duly constituted in accordance with section 50 or otherwise.

57.

(1)   Subject to subsection (2) and any limitations in its Memorandum or Articles or in any unanimous shareholder agreement, a company incorporated under this Act may indemnify against all expenses, including legal fees, and against all judgements, fines and amounts paid in settlement and reasonably incurred in connection with legal, or administrative proceedings any person who –

(a)    is or was a party or is threatened to be made a party to any threatened, pending or completed proceedings, whether civil, or administrative by reason of the fact that the person is or was a director, an officer or a liquidator of the company; or

(b)   is or was, at the request of the company, serving as a director, officer or liquidator, or in any other capacity is or was acting for, another company or a partnership, joint venture, trust or other enterprise.

(2)   Subsection (1) only applies to a person referred to in that subsection if the person acted honestly and in good faith with a view to the best interests of the company.

58.        A company incorporated under this Act may purchase and maintain insurance in relation to any person who is or was a director, a registered agent, an officer or a liquidator of the company, or who at the request of the company is or was serving as a director, a registered agent, and officer or a liquidator of, or in any other capacity is or was acting for, another company or a partnership, joint venture, trust or other enterprise, against any liability asserted against the person and incurred by the person in that capacity, whether or not the company has or would have had the power to indemnify the person against the liability under subsection (1) of section 57.

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