Co-operatives Act 2009

A distributing co‑operative may issue shares at a premium.

A premium may be in the form of cash or other valuable consideration.

If a distributing co‑operative issues shares for which it receives a premium, an amount equal to the total amount or value of the premiums on the shares must be transferred to a share premium account.

The share premium account is to be treated as paid up share capital of the distributing co‑operative and may be applied in any one or more of the following ways —

in paying up unissued shares to be issued to members of the co‑operative as fully paid bonus shares;

in paying up, in whole or in part, the balance unpaid on shares previously issued to members of the co‑operative;

in the payment of dividends, if those dividends are satisfied by the issue of shares to members of the co‑operative;

in writing off the expenses incurred in establishing the co‑operative;

in providing for the premium payable on redemption of shares, debentures or CCUs.