An allotment of shares made before the minimum subscription is raised is voidable at
the option of the applicant within one month of the statutory meeting or allotment.
An allotment made before expiration three days from the date of delivery to the registrar for registration a statement in lieu of prospectus signed by every person named or proposed director and containing the particulars of Part I and II of the 4th Schedule is voidable at the option of the applicant.
An allotment of shares to a state corporation without prior written consent of the treasury is void. The company and every director who knowingly or willfully permits or authorities the contravention are liable to a fine not exceeding Kshs2,000.
An allotment of shares before the beginning of the third day after that on which the prospectus was first issued is irregular but valid. However the company and every officer in default are liable to a fine not exceeding Kshs10,000.