Regulation 2 — Definitions

(1) In these regulations, unless there is anything repugnant in the subject
or context, —
(i) “Act” means the Companies Act, 2017 (XIX of 2017);
(ii) “Annexure” means an annexure appended to these regulations;
(iii) “authorized intermediary” means a person registered by the Commission under
these regulations and who is authorized by a company or promoters of a proposed
company or a foreign company under an agreement for filing of documents on their
behalf in pursuance of the Act;
(iv) “authorized officer” includes a chief executive officer, director, company secretary,
chief financial officer of the company or a representative authorized by the Board or
an authorized intermediary or principal officer in case of foreign companies to sign a
document or proceeding requiring authentication by the company:
Provided that—
(a) in the case of a company in relation to which an administrator has been appointed
under sub -section (1) of section 291 of the Act , the administrator of such
company; or
(b) in the case of a company in liquidation, the liquidator of such company; shall be
the authorized officer of the company;
(v) “association” means a group of persons united for a common object desirous of
obtaining license under section 42 of the Act;
(vi) “benefits” means all monetary and non -monetary favors of any kind received from
the company directly or indirectly including but not limited to company maintained
car, medical plan, house rent, loans and advances but does not include official
travelling re imbursements, boarding and lodging expenses incurred on attending
official meetings or expenses incurred in attending office as per entitlement or any
meeting fee for attending the meetings of the board or a committee of board as
determined by the board of directors;
(vii) “book closure” means the period during which the register of members is closed in
terms of section 125 of the Act;
(viii) “close relative” means spouse(s), siblings and their children, lineal ascendants and
descendants;
(ix) “Commission” shall have the same meaning as assigned to it under the Securities and
Exchange Commission of Pakistan Act, 1997 (XLII of 1997);

(x) “Company Registration Office” means an office established by the Commission
under sub-section (1) of section 462 of the Act;
(xi) “corporate unique identification number or “CUIN” means a sequential computer-
generated registration number assigned to every company including foreign company
and includes corporate universal identification number assigned to the companies
before the issuance of these regulations;
(xii) “donation” means contribution whether in cash or in kind, in the form of charity,
grant, aid, contribution, gift, assistance, subsidy or a ny other form, received directly
or indirectly, from any source whether local or foreign, for the purpose of achieving
the objects of the company;
(xiii) “electronic database” means the system for maintaining a database electronically in
respect of all the record of companies and includes the Corporate Registration System,
Corporate Compliance and Facilitation System and Diary System;
(xiv) “e-service” shall have the same meaning as assigned to it under clause (27) of sub -
section (1) of section 2 of the Act;
(xv) “exercise” means making of an application by an employee to a company for issue of
shares against option vested in him in pursuance of a Scheme;
(xvi) “exercise period” means the time period after vesting within which an employee may
exercise his right to apply for shares against an option vested in him in pursuance of
the Scheme;
(xvii) “exercise price” means the price payable by an employee for exercising an option
granted to him in pursuance of the Scheme;
(xviii) “fee” means fee as specified in Seventh Schedule to the Act;
(xix) “foreign company” shall have the same meaning as assigned to it under the Act;
(xx) “Form” means a form annexed to these regulations and includes a return;
(xxi) “firm” means a practicing firm of management consultants, financial consultants,
corporate consultants or tax practitioners;
(xxii) “further issue of shares” means issue of shares under section 83 of the Act and does
not include Initial Public Offer or offer for sale of shares by any person holding shares
in listed company or further issue of shares pursuant to any scheme of arrangement
including merger, demerger, amalgamation etc.;
(xxiii) “Limited Liability Partnership” shall have the same meaning as assigned to it under
the Limited Liability Partnership Act, 2017;

(xxiv) “initial public offer or IPO” means first time offer of securities to the general public;
(xxv) “issue” for the purpose of these regulations, means further issue of shares;
(xxvi) “issue of share s at discount” means issue of share s at a price below face value of
such share;
(xxvii) “issue of shares by way of other than right” means issue of shares out of the share
capital of a company or body corporate to any person without right offer, either for
cash or for consideration otherwise than in cash;
(xxviii) “issue price” means the price per share at which shares are offered or issued;
(xxix) “issue size” means the total number of shares issued or proposed to be issued by a
company;
(xxx) “market price” for the purpose of a scheme means latest available closing price of
the share on a securities exchange on which the shares of the company are listed and
where share price is not traded on a given date, then the share price on the last trading
day shall be considered;
(xxxi) “option” means a right but not an obligation granted to an employee in pursuance of
a scheme to apply for shares of a company at a pre-determined price;
(xxxii) "purchase" means buy-back of its own shares by a purchasing company under section
88 of the Act and these regulations;
(xxxiii) "purchasing company" means a public unlisted or a private limited company that
intends to purchase its own shares under section 88 of the Act and these regulations;
and
(xxxiv) “purchase period” means the period of sixty days comme ncing from the date of
dispatch of the offer letter;
(xxxv) “preference shares” mean the shares which carry or would carry such preferential
rights or privileges as provided for in the articles of association of the company
including but not limited to the following;
(a) preferential right over the rights of ordinary shareholders to receive dividend;
preference dividend may be cumulative or non-cumulative;
(b) preferential right over the rights of ordinary shareholders to participate in profits
of company;
(c) preferential rights over the rights of ordinary shareholders to be paid in the event
of winding up of the issuer; and

(d) voting and non-voting rights
(xxxvi) “promoter” shall have the same meaning as assigned to it under the Act, and shall
also include member of Association who has applied for the grant of a license under
section 42 of the Act.
(xxxvii) “registrar concerned” means a registrar, who is in-charge of a Company Registration
Office in whose territorial jurisdiction the registered office of the company is situated;
(xxxviii) “Registrar of Companies” means the Registrar of Companies designated as such by
the Commission and posted at head office of the Commission and who is head of the
offices for the registration of companies in Pakistan and performing other work under
the Act;
(xxxix) “registered intermediary” means a person registered by the Commission under these
regulations;
(xl) “remuneration” means reward or compensation for employment in the form of pay,
salary or wage including all other perquisites and non -cash incentives but does not
include meeting fee for attending meetings of board or committee of board and
reimbursement for boarding or lodging for attending board meetings;
(xli) “right issue” means the shares offered by a company to its members strictly in
proportion to the shares already held in respective kinds and classes;
(xlii) “seal” means the seal of the company registration office having the name of company
registration office engraved on it;
(xliii) “schedule” means a schedule to the Act;
(xliv) “scheme” means an Employees Stock Option Scheme (ESOS) in accordance with
procedure and on conditions specified through these regulations;
(xlv) “vesting” means to give or earn a right to apply for conversion of the options, granted
under a scheme, into shares of the company; and
(xlvi) “vesting period” means the period during which the vesting of an option granted to
an employee in pursuance of a scheme takes place.
(2) The words and expressions used but not defined in these regulations shall have the
same meaning as are assigned to them in the Act, the Securities and Exchange Commission of
Pakistan Act, 1997(XLII of 1997), the Limited Liability Partnership Act, 2017 (XV of 2017),
Securities Act, 2015 (III of 2015) and any rules made thereunder.
CHAPTER II
RESERVATION OF NAME OF A COMPANY AND CHANGE THEREOF