Introduction Equity holders Overview Section 172: Company A’s proportion if shares etc have temporary rights
690.This section and section 171 require an alternative calculation if an equity holder’s rights (either to profits or to assets in a winding up) are capable of changing. Both sections are based on paragraph 5 of Schedule 18 to ICTA.
691.Subsection (1) takes up the story from the previous section, which determines whether or not this section applies. To arrive at the “alternative proportion” one must assume that the rights of the equity holders are now what they will be at a “future time” when the rights become different (see section 171(2) and (3)).
692.Subsection (2) explains “relevant future time”.
693.Subsection (3) is the rule that the alternative proportion is used if it is smaller than the proportion that would otherwise be used.