Brighton Ltd issues a prospectus inviting the public to subscribe for 10 million ordinary shares of $2.00 each. The terms of the issue are that $1.00 is to be paid on application and the remaining $1.00 within one month of allotment.

Applications are received for 12 million shares during July 2019. The directors allot 10 million shares on 5 August 2019. All applicants receive shares on a pro rata basis. The amounts payable on allotment are due by 5 September 2019.

By 5 September 2019 the holders of 2 million shares have failed to pay the amounts due on allotment. The directors forfeit the shares on 10 September 2019. The shares are resold on 15 September 2019 as fully paid. An amount of $1.80 per share is received.