flowchart LR
A["Classification of <br> Companies"] --> B[By Incorporation]
A --> C[By Liability]
A --> D[By Number of Members]
A --> E[By Control]
A --> F[By Ownership]
A --> G[Special Types]
B --> B1[Statutory]
B --> B2[Registered]
B --> B3[Chartered]
C --> C1[Limited by Shares]
C --> C2[Limited by Guarantee]
C --> C3[Unlimited]
D --> D1[Private]
D --> D2[Public]
D --> D3[One Person Company]
E --> E1[Holding]
E --> E2[Subsidiary]
E --> E3[Associate]
F --> F1[Government]
F --> F2[Foreign]
F --> F3[Domestic]
G --> G1[Small Company]
G --> G2[Dormant Company]
G --> G3[Producer Company]
G --> G4["Section 8 <br> (Not-for-Profit)"]
%% Style
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class A,B,B1,B2,B3,C,C1,C2,C3,D,D1,D2,D3,E,E1,E2,E3,F,F1,F2,F3,G,G1,G2,G3,G4 dark;
2 Various Types of Companies and Their Memberships
ImportantLearning Objectives
By the end of this chapter, the reader will be able to:
- Classify companies in India along five legal axes: mode of incorporation, extent of liability, number of members, control relationships, and pattern of ownership.
- Identify the statutory basis under the Companies Act, 2013 for each principal type of company, including private, public, one person, holding, subsidiary, government, foreign, small, dormant, producer, and Section 8 companies.
- Distinguish a member from a shareholder, identify the modes by which membership is acquired and lost, and describe the legal effect of entry on the register of members.
- Apply the holding-subsidiary tests under Section 2(87) and the foreign company definition under Section 2(42) to real corporate structures.
- Evaluate the strategic and regulatory consequences of choosing one form of company over another for a given business venture.
2.1 Introduction
Chapter 1 established that a company is a body corporate registered under the Companies Act, 2013, possessing separate legal personality, limited liability, and perpetual succession. The Act, however, does not recognise a single uniform company. It instead provides for a graduated typology in which different forms of company are subject to different rules on capital, governance, disclosure, and member liability. A founder selecting a corporate vehicle, a regulator framing oversight, a creditor assessing recovery, and an investor evaluating exposure all begin from the same question: what type of company is this?
The classification of companies has both doctrinal and practical significance. Doctrinally, the type of company determines which provisions of the Companies Act apply to it, what disclosures it must make, how its securities may be issued and transferred, and what governance standards it must observe. Practically, the choice between a private limited company, a public limited company, a one person company, and a Section 8 not-for-profit company shapes the cost of compliance, the access to capital, the freedom of governance, and the exposure of the founders to personal liability.
This chapter sets out the principal classifications of companies under Indian law and then examines the concept of membership, which is the legal mechanism by which a person becomes part of the company. The discussion is grounded in the Companies Act, 2013 and supplemented by the rules issued by the Ministry of Corporate Affairs, by SEBI regulations for listed entities, and by relevant judicial authority.
2.2 Classification by Mode of Incorporation
A company comes into existence through one of three historical mechanisms: a royal charter, a special statute, or registration under a general companies law. In contemporary India, the chartered company is now of historical interest only, while the other two routes continue to operate.
2.2.1 Chartered Companies
A chartered company is one created by a sovereign charter, that is, by a direct grant from the Crown or other sovereign authority. The East India Company, chartered by Queen Elizabeth I in 1600, is the most consequential example. Chartered companies are no longer formed in independent India, since the constitutional power to create a body corporate by sovereign grant has not been retained, but the legal category remains relevant for understanding the historical evolution of the company form.
2.2.2 Statutory Companies
A statutory company is brought into existence by a special Act of Parliament or a State Legislature, which both creates the company and prescribes its objects, powers, and governance. The provisions of the Companies Act, 2013 apply to statutory companies only to the extent that the special Act does not provide otherwise. Statutory companies are typically used for entities that perform public functions or operate in regulated sectors.
NoteExamples of Indian Statutory Companies
The Reserve Bank of India was constituted under the Reserve Bank of India Act, 1934. The Life Insurance Corporation of India was constituted under the Life Insurance Corporation Act, 1956. The State Bank of India was constituted under the State Bank of India Act, 1955. The Food Corporation of India was constituted under the Food Corporations Act, 1964. Each of these entities operates under a bespoke statutory framework that reflects its public mission.
2.2.3 Registered Companies
A registered company is one formed by registration under the Companies Act, 2013 or under a previous Indian companies legislation. The overwhelming majority of Indian companies are registered companies. Registration is effected by filing the prescribed incorporation documents with the Registrar of Companies, who, on being satisfied that the requirements of the Act have been complied with, issues a certificate of incorporation.
TipWhy the Registered Form Dominates
The registered form dominates because it is open to any group of persons who comply with the statutory requirements, without the need for a special Act of Parliament or a sovereign grant. It is the democratic form of incorporation, available equally to a multinational conglomerate and to two graduates incorporating their first venture. The Companies Act, 2013 has further lowered the threshold by permitting one-person incorporation for the first time in Indian law.
2.3 Classification by Liability
A company may be classified by reference to the liability that members assume on a winding up. The Companies Act, 2013 recognises three categories.
2.3.2 Company Limited by Guarantee
A company limited by guarantee is one in which the liability of each member is limited to the amount that the member has agreed to contribute to the assets of the company in the event of its being wound up. The guaranteed amount is specified in the memorandum of association. Companies limited by guarantee may, but need not, have a share capital. They are most commonly used for non-profit, professional, charitable, and educational entities.
For example, the Indian Red Cross Society, several professional bodies such as the Confederation of Indian Industry, and many trade associations are organised as companies limited by guarantee. The members’ financial exposure is restricted to the modest guaranteed amount specified in the memorandum, typically ₹100 to ₹1,000 per member.
2.3.3 Unlimited Company
An unlimited company is one in which the liability of members is not limited. On a winding up, members are personally liable, in proportion to their interest, for the full amount of the company’s debts. The unlimited company retains the procedural and tax advantages of incorporation, including separate legal personality and perpetual succession, but exposes its members to unlimited personal liability.
WarningThe Unlimited Company is Rare for Good Reason
The unlimited company is now rarely encountered in Indian practice because it abandons the single most important commercial benefit of incorporation, the protection of personal assets. The form survives in a small number of professional contexts and in certain group structures where unlimited liability is used as a credibility signal to creditors, but it is not a sensible default for any new venture.
2.4 Classification by Number of Members
The number of members a company has, and whether it can invite the public to subscribe for its securities, is the most consequential single classification in Indian corporate law. It determines the regulatory regime that applies to the company, the disclosures it must make, and the freedom with which it may transact in its own securities.
2.4.1 Private Company
A private company is defined in Section 2(68) of the Companies Act, 2013 as a company which, by its articles, restricts the right to transfer its shares, limits the number of its members to 200 (excluding employees and former employees who acquired shares while in employment), and prohibits any invitation to the public to subscribe for any securities of the company. The minimum number of members is two.
NoteSection 2(68): The Statutory Definition
“Private company” means a company having a minimum paid-up share capital as may be prescribed, and which by its articles:
restricts the right to transfer its shares;
except in the case of One Person Company, limits the number of its members to two hundred; and
prohibits any invitation to the public to subscribe for any securities of the company.
The private company is the workhorse of Indian corporate practice. It is the natural form for a closely held family business, an early-stage start-up, a wholly owned subsidiary, and a special purpose vehicle. The restrictions on transferability and on public subscription preserve the closely held character of the firm and reduce the regulatory burden compared to a public company.
For example, Zoho Corporation Private Limited, founded by Sridhar Vembu in 1996, has remained closely held by the founder and a small group of insiders, deliberately avoiding the public market and the disclosure obligations it brings.
2.4.2 Public Company
A public company is defined in Section 2(71) as a company which is not a private company. The minimum number of members is seven, with no upper limit. A public company may invite the public to subscribe for its securities, and its shares are freely transferable subject to the company’s articles. A subsidiary of a public company is itself deemed to be a public company, even if its articles contain the restrictions normally found in a private company’s articles.
TipPublic Company Does Not Mean Listed Company
A common conflation in everyday usage is between a public company and a listed company. The two are distinct. A public company is one that satisfies Section 2(71) and is therefore eligible to issue securities to the public. A listed company is one whose securities have actually been admitted to trading on a recognised stock exchange. Every listed company is a public company, but not every public company is listed. Many large Indian public companies remain unlisted by choice.
2.4.3 One Person Company
The One Person Company (OPC), introduced for the first time in Indian law by the Companies Act, 2013, is defined in Section 2(62) as a company which has only one person as a member. The OPC must nominate, in the memorandum, another natural person as a successor in the event of the founder’s death or incapacity. The OPC is treated as a private company for the purposes of the Act and is subject to relaxed compliance requirements.
For example, a solo consultant who wishes to enjoy limited liability and a corporate identity without the procedural complexity of a private limited company with multiple members may incorporate an OPC. The 2021 amendments to the OPC rules removed the earlier turnover and paid-up capital ceilings and shortened the residency requirement for the founder, making the OPC substantially more attractive than at its introduction.
2.5 Classification by Control
A company may stand in a relationship of control with one or more other companies. The Companies Act, 2013 recognises three principal categories of inter-corporate relationship.
2.5.1 Holding Company and Subsidiary Company
Section 2(87) defines a subsidiary company as a company in which the holding company controls the composition of the board of directors, or exercises or controls more than one-half of the total voting power, either at its own or together with one or more of its subsidiaries. Section 2(46) defines a holding company by reference to the same relationship: the holding company is the company that controls the subsidiary.
For example, Tata Sons Private Limited is the principal holding company of the Tata group. It holds controlling stakes in Tata Consultancy Services Limited, Tata Motors Limited, Tata Steel Limited, Titan Company Limited, and many other operating companies. Each of these operating companies is a subsidiary of Tata Sons within the meaning of Section 2(87), and Tata Sons stands as their holding company within the meaning of Section 2(46).
NoteTests for Subsidiary Status
Section 2(87) provides two alternative tests, either of which is sufficient:
Board control test: the holding company controls the composition of the subsidiary’s board of directors, that is, it has the power to appoint or remove a majority of the directors.
Voting control test: the holding company exercises or controls more than one-half of the total voting power, either alone or together with its other subsidiaries.
The presence of either test makes the company a subsidiary, and consequential restrictions in the Act, including limits on cross-holding and on layers of subsidiaries, apply.
2.5.2 Associate Company
Section 2(6) defines an associate company as one in which the other company has a significant influence, that is, controls at least 20 per cent of the total voting power, or controls or participates in business decisions under an agreement, but which is not a subsidiary. The associate company concept captures intermediate relationships of influence that fall short of control.
WarningThe Holding-Subsidiary Tests Are About Control, Not Ownership
A common error is to assume that a company becomes a subsidiary when more than 50 per cent of its shares are owned by another company. This is an inaccurate restatement. The statutory test refers to voting power and to board composition, not to share ownership. A company can be a subsidiary even though less than half its shares are held by the holding company, if the holding company has the power to appoint or remove a majority of the board through some other arrangement, such as differential voting rights or a shareholders’ agreement.
2.6 Classification by Ownership
The ownership classification distinguishes companies by reference to who holds the share capital and where the company is incorporated.
2.6.1 Government Company
Section 2(45) defines a government company as a company in which not less than 51 per cent of the paid-up share capital is held by the central government, or by any state government or governments, or partly by the central government and partly by one or more state governments. A subsidiary of a government company is itself a government company.
For example, Bharat Heavy Electricals Limited (BHEL), Oil and Natural Gas Corporation Limited (ONGC), Indian Oil Corporation Limited, Coal India Limited, and Steel Authority of India Limited are leading government companies operating in heavy engineering, oil and gas, energy, mining, and steel respectively. They are subject to the general framework of the Companies Act, 2013, but additional rules apply to their auditing (under the Comptroller and Auditor General of India) and to the appointment of directors.
2.6.2 Foreign Company
Section 2(42) defines a foreign company as a company or body corporate incorporated outside India which has a place of business in India, whether by itself or through an agent, physically or through electronic mode, and which conducts any business activity in India in any other manner. Foreign companies are subject to specific reporting and disclosure requirements under Chapter XXII of the Companies Act, 2013.
NoteVodafone International Holdings B.V. v. Union of India (2012)
The Supreme Court of India, in Vodafone International Holdings B.V. v. Union of India (2012) 6 SCC 613, considered the tax treatment of an offshore acquisition that resulted in indirect transfer of Indian assets. While the case turned principally on the construction of the Income Tax Act, 1961, it illustrated the regulatory and tax sensitivity of foreign company structures used to invest in India. The judgment was followed by retrospective amendments to the Income Tax Act and by the eventual withdrawal of the retrospective levy in 2021.
The case is required reading for any practitioner advising on cross-border acquisition or investment structures involving Indian assets.
For example, Google India Private Limited operates in India as a registered Indian company, while its parent, Alphabet Inc., is incorporated in the United States. Where a foreign-incorporated company itself establishes an Indian branch or liaison office, that arrangement is governed by Section 2(42) and the foreign company provisions of the Act, in addition to the regulations of the Reserve Bank of India.
2.6.3 Domestic Company
A domestic company is a company incorporated in India under the Companies Act, 2013 or an earlier Indian companies legislation. The term is used principally in tax and regulatory contexts to distinguish Indian-incorporated companies from foreign companies.
2.7 Special Types of Companies
The Companies Act, 2013 and related statutes recognise several specialised forms of company that depart from the standard private or public form. Each is designed to serve a particular policy objective.
2.7.1 Small Company
Section 2(85) defines a small company as a company, other than a public company, whose paid-up share capital does not exceed the limit prescribed by the central government (currently ₹4 crore) and whose turnover, as per the latest profit and loss account, does not exceed the prescribed limit (currently ₹40 crore). A small company is exempt from a number of compliance requirements applicable to larger companies, including a relaxed regime for cash flow statements, board meetings, and rotation of auditors.
2.7.2 Dormant Company
Section 455 provides for the registration of a dormant company, defined as a company formed for a future project or to hold an asset or intellectual property, and that has had no significant accounting transactions during the previous two financial years. Dormant status reduces the compliance burden on inactive companies pending their reactivation.
2.7.3 Producer Company
A producer company is a body corporate having objects connected with the production, harvesting, processing, or marketing of agricultural produce, governed by Part IXA of the Companies Act, 1956 (now incorporated by reference into the 2013 Act). The form is intended for cooperatives of farmers and primary producers seeking corporate identity while preserving member-owner control.
For example, Amul, in its earlier form, and a number of farmer-producer organisations registered after 2002 in the wake of the Y. K. Alagh Committee report have used the producer company form.
2.7.4 Section 8 Company (Not-for-Profit)
Section 8 of the Companies Act, 2013 provides for the licensing of companies formed for the promotion of commerce, art, science, sports, education, research, social welfare, religion, charity, protection of the environment, or any similar object, where the company intends to apply its profits, if any, towards the promotion of its objects and prohibits the payment of any dividend to its members. A Section 8 company enjoys exemption from the requirement to use “Limited” or “Private Limited” in its name and is eligible for several tax and regulatory concessions.
For example, the Confederation of Indian Industry, the Indian Cancer Society, and a number of major corporate foundations are organised as Section 8 companies. The form combines the legal personality and governance discipline of a company with the not-for-profit orientation of a trust or society.
2.7.5 Nidhi Company
A Nidhi company is a company recognised under Section 406 of the Companies Act, 2013 and the Nidhi Rules, 2014, which exists for the mutual benefit of its members through borrowing and lending among themselves. Nidhi companies are concentrated in southern India and serve as a regulated form of mutual benefit society.
2.8 Membership of a Company
Membership is the legal mechanism by which a person becomes part of a company. Section 2(55) defines a “member” of a company as the subscriber to the memorandum of association who is deemed to have agreed to become a member, every other person who agrees in writing to become a member of the company and whose name is entered in its register of members, and every person holding shares of the company and whose name is entered as a beneficial owner in the records of a depository.
2.8.2 Who Can Become a Member
Any person who is competent to contract may become a member of a company. This includes individuals of full age and sound mind, companies and other bodies corporate, limited liability partnerships, registered partnership firms (in the case of a Section 8 company, by virtue of a specific exception), trusts (where permitted by their deed and the company’s articles), the central and state governments, and certain other persons recognised by law.
A minor cannot, on ordinary contract law principles, become a member directly, since a minor’s contract is void ab initio. A minor may, however, hold shares through a guardian, with the legal effect of membership being attributed to the guardian during the minority of the beneficial owner.
NotePalaniappa Mudaliar v. Official Assignee of Madras (1949)
The Madras High Court held that a person of unsound mind cannot become a member of a company, since the law of contract requires capacity. The case illustrates the application to corporate membership of the general principles of contractual capacity under the Indian Contract Act, 1872.
2.8.3 Modes of Acquiring Membership
A person may acquire membership in a company in any of the following ways. First, by subscribing to the memorandum of association at the time of incorporation, in which case the subscriber is deemed to have agreed to take the shares specified against the subscriber’s name. Second, by application and allotment, in which case a person applies for shares and the company allots them, with the name being entered on the register on allotment. Third, by transfer, in which case an existing member transfers shares to a new member, who is registered on completion of the prescribed formalities. Fourth, by transmission, which is the operation of law on the death, insolvency, or insanity of an existing member, transferring the shares to the legal representative or assignee. Fifth, by acquisition, where a person acquires shares pursuant to a scheme of merger, demerger, or other arrangement sanctioned by the National Company Law Tribunal.
2.8.4 Cessation of Membership
A person ceases to be a member of a company on the occurrence of any of the following events. First, transfer of all the shares held to another person and registration of the transfer. Second, forfeiture of shares for non-payment of calls. Third, surrender of shares where the articles permit. Fourth, sale of shares by the company under a lien for unpaid calls. Fifth, redemption of redeemable preference shares. Sixth, repurchase of shares by the company under Section 68. Seventh, death of the member, on which the legal representative becomes entitled to be registered. Eighth, insolvency of the member, on which the rights pass to the assignee. Ninth, rescission of the contract of membership for misrepresentation or fraud. Tenth, dissolution of the company on a winding up.
2.8.5 Register of Members
Section 88 of the Companies Act, 2013 requires every company to maintain a register of members in the prescribed form. The register must contain the name and address of each member, the number and class of shares held, the amount paid and unpaid on each share, and the dates of entry and cessation. The register is prima facie evidence of the matters stated in it. A person whose name appears on the register is a member; a person whose name does not appear on the register is not a member, even if that person beneficially owns the shares.
TipThe Register of Members is the Legal Anchor of Membership
The legal effect of the register of members is sometimes underestimated. A purchaser who pays for shares but whose name is not entered on the register acquires the beneficial interest in those shares but does not become a member of the company. The right to vote, to receive dividends, and to receive notice of meetings flows from membership, not from beneficial ownership. The act of registration on the register of members is therefore more than a formality; it is the constitutive act of membership.
2.9 Case Studies
2.9.1 Case Study 1: The Tata Sons Holding Structure
Tata Sons Private Limited is the principal holding company of the Tata group, which comprises more than 100 operating companies across automotive, steel, power, information technology, hospitality, retail, financial services, and other sectors. Tata Sons is itself a private limited company; its principal shareholders are the Tata Trusts, which hold approximately two-thirds of its share capital, with the balance held by Shapoorji Pallonji and Company and other minority shareholders.
The holding-subsidiary structure of the Tata group illustrates several features of the classification system. Tata Sons is a holding company within the meaning of Section 2(46) by virtue of its controlling stakes in Tata Consultancy Services Limited, Tata Motors Limited, Tata Steel Limited, and other group companies. Each of those companies is, simultaneously, a public listed company subject to the full SEBI regulatory regime, and a subsidiary of Tata Sons subject to Section 2(87). The control test is satisfied principally through voting power and through Tata Sons’ power to nominate directors. The structure permits centralised group strategy and capital allocation while preserving the independent listed identity and governance of each operating company.
Discussion Questions
- Why is Tata Sons itself a private company rather than a public listed company? What advantages does the private form confer on the holding entity?
- If Tata Sons holds, say, 28 per cent of the shares of an operating company but exercises board control through a shareholders’ agreement, would that company nevertheless be a subsidiary within the meaning of Section 2(87)?
- What governance challenges does a holding-subsidiary structure pose where the subsidiaries are listed and the holding company is not?
2.9.2 Case Study 2: Vodafone in India and the Foreign Company Question
In 2007, Vodafone International Holdings B.V., a company incorporated in the Netherlands, acquired the Cayman Islands-incorporated CGP Investments (Holdings) Limited, which indirectly held a controlling interest in Hutchison Essar Limited, an Indian operating company. The Indian tax authorities issued a tax demand on the basis that the underlying Indian assets had been transferred. The Supreme Court ruled in 2012 that the transaction did not attract Indian tax under the law as it then stood, since the transfer was offshore and the Indian situs requirement was not satisfied.
The episode illustrates the layered nature of foreign company regulation. The acquired Indian operating company was a domestic company. The intermediate Cayman Islands company was a foreign company that did not have a place of business in India and was therefore not subject to Section 2(42). The Dutch acquirer was a foreign company that conducted no business in India at all. Yet the indirect economic effect of the acquisition was to transfer control over Indian assets. The retrospective amendment that followed Vodafone, and its eventual withdrawal in 2021, reflects the ongoing tension between the formal classification of companies by jurisdiction of incorporation and the substantive economic effect of cross-border transactions.
Discussion Questions
- To what extent does the formal classification of a company as foreign or domestic adequately reflect the economic substance of its activities in India?
- In what ways do the foreign company provisions of the Companies Act, 2013 complement, and in what ways do they fall short of, the regulatory architecture for cross-border investment in India?
- Should Indian law adopt a substance-based rather than a form-based test for foreign company status? What are the costs and benefits of each approach?
Summary
| Concept | Description |
|---|---|
| Classification by Incorporation | |
| Statutory Company | A company brought into existence by a special Act of Parliament or State Legislature, such as the Reserve Bank of India under the RBI Act, 1934 |
| Registered Company | A company formed by registration under the Companies Act, 2013 or an earlier Indian companies legislation, the dominant form in modern India |
| Chartered Company | A company created by sovereign charter, of historical interest only in independent India |
| Classification by Liability | |
| Company Limited by Shares | A company in which the liability of each member is limited to the amount unpaid on shares held by the member |
| Company Limited by Guarantee | A company in which the liability of each member is limited to the amount the member has agreed to contribute on a winding up, common in non-profit and trade bodies |
| Unlimited Company | A company in which the liability of members is unlimited, retaining the procedural advantages of incorporation but exposing members to full personal liability |
| Classification by Members | |
| Private Company (s. 2(68)) | A closely held company that restricts share transfers, caps members at 200, and prohibits public subscription, with a minimum of two members |
| Public Company (s. 2(71)) | A company that is not a private company, with a minimum of seven members and the ability to invite the public to subscribe for its securities |
| One Person Company (s. 2(62)) | A company with a single member, introduced by the Companies Act, 2013, with a nominated successor in the memorandum of association |
| Classification by Control | |
| Holding Company (s. 2(46)) | A company that controls one or more subsidiary companies through board composition or voting power |
| Subsidiary Company (s. 2(87)) | A company controlled by another company through control of the board of directors or more than one-half of the total voting power |
| Associate Company (s. 2(6)) | A company in which another company has a significant influence of at least 20 per cent of voting power, but which is not a subsidiary |
| Classification by Ownership | |
| Government Company (s. 2(45)) | A company in which 51 per cent or more of the paid-up share capital is held by the central or state government, jointly or severally |
| Foreign Company (s. 2(42)) | A body corporate incorporated outside India that has a place of business in India and conducts business activity in India |
| Domestic Company | A company incorporated in India under the Companies Act, 2013 or an earlier Indian companies legislation |
| Special Types of Companies | |
| Small Company (s. 2(85)) | A non-public company with paid-up capital and turnover below prescribed thresholds, eligible for relaxed compliance requirements |
| Dormant Company (s. 455) | A company formed for a future project or to hold assets or intellectual property, with no significant accounting transactions in the previous two years |
| Producer Company | A body corporate with objects connected with the production, harvesting, processing, or marketing of agricultural produce, designed for primary producer cooperatives |
| Section 8 Company | A not-for-profit company licensed under Section 8 to promote commerce, art, science, education, charity, or similar objects, prohibited from paying dividends |
| Nidhi Company (s. 406) | A mutual benefit company recognised under Section 406 that exists for borrowing and lending among its members, concentrated in southern India |
| Membership of a Company | |
| Member (s. 2(55)) | A subscriber to the memorandum of association, or any other person whose name is entered on the register of members or as a beneficial owner in depository records |
| Register of Members (s. 88) | The statutory record of members maintained under Section 88, which is prima facie evidence of membership and the legal anchor of all member rights |
| Modes of Acquiring Membership | Subscription to the memorandum, allotment, transfer, transmission, or acquisition under a court-sanctioned scheme of arrangement |
| Cessation of Membership | Transfer, forfeiture, surrender, redemption, repurchase, death, insolvency, rescission, or dissolution of the company on a winding up |