Redeemable Shares are issued with an agreement that the company will buy them back at the option of the company or the shareholder after a certain period, or on a fixed date. A company can not issue redeemable shares only.
Shares subject to purchase by the corporation on terms set forth in the articles of incorporation.
Shares which may be bought back by the company which originally issued them. Français: Actions rachetables Español: Acción amortizable
Under Chapter VII of Part V of the Companies Act 1985, a company can redeem shares which are issued as redeemable shares by repaying the nominal value to the shareholder, whereupon the shares are cancelled. Redemption must normally be from distributable profits, but a procedure exists to allow shares to be redeemed from capital. As this amounts to a reduction of capital, an amount equivalent to its reduction of issued capital may well need to be transferred to a capital redemption reserve.