CHAPTER 4
SHARES AND DEBENTURES
(1) The face value of shares of a private company shall be as specified in its articles of association.
(2) The face value of shares of a public company shall be fifty rupees per share or shall be equivalent to such amount exceeding fifty rupees as is divisible by the figure ten as provided in the memorandum of association and articles ….Read More….
(1) Where a public company invites the general public to apply for the subscription of its shares it shall allot the shares and give the shareholders a notice in the format as prescribed, within a maximum period of three months after the date of closure of share issue.
Provided, however, that in cases where at least fifty percent of the total shares issued publicly cannot be sold failing a ….Read More….
(1) Any company fulfilling the following conditions may, with the prior approval of the Office, issue shares at a premium:
- (a) The company has been making profits and distributing dividends ….Read More….
(1) The company may, by making provisions to that effect in its memorandum of association and articles of association, issue various classes of shares with different rights attached thereto.
(2) Except as otherwise provided in the articles of association of a accompany, approval of the shareholders of any ….Read More….
(1) A company shall file with the Office a return of allotments stating the number of shares issued and allotted, the total amount of the shares, the names and addresses of the allotters, and the amount paid or due and payable on each share, within thirty days after the allotment of shares.
(2) if any shares have been allotted as ….Read More….
(1) While issuing its securities to the general public, a public company shall deal in the securities only through a securities dealer recognized to do securities transactions including all acts such as the sale, allotment, and recovery of amounts of such securities.
(2) A public company shall file with the Office a ….Read More….
(1) A share certificate in the prescribed format shall be issued to every shareholder in respect of each share subscribed by him/her, within two months after the allotment of shares; the share certificate shall bear the signature of any two out of a director or chief executive of the company or the company secretary, in the case of a public company, and the signature of the person as mentioned in the articles of ….Read More….
(1) If a public company deems necessary to raise loans or issue debentures, it may, specifying the reason, therefore, a work plan to be executed from proceeds and budget necessary for that propose raise loans or issue debentures with or
without pledging or mortgaging its immovable assets.
Provided, however, that no ….Read More….
(1) A public company shall, in issuing debentures pursuant to this Act, issue debentures after making provision of a debenture trustee. Such debenture trustee has to be a debenture trustee licensed by the Securities Board.
(2) The matters relating to the creditor and ….Read More….
(1) An agreement has to be concluded between a company issuing debentures and a debenture trustee acting as a trustee for the protection of the interest of debenture-holders, in respect of the debentures to be raised by such company.
(2) An agreement to be concluded pursuant to Sub-section(1) shall set out ….Read More….
Prior to concluding an agreement with a company to act as a debenture trustee, the debenture trustee may hold the necessary inquiry into, and obtain or demand statements, notice or information on, the following matters; and the concerned company has to provide the same if so demanded:
(a) Whether the memorandum of association ….Read More….
(1) After an agreement has been concluded between a company and a debenture trustee under Section 36, the company has to submit its statements in financial transactions to the debenture trustee in every six months.
(2) In the event of a change in the management ….Read More….
(1) If the company violates any of the terms mentioned in the agreement concluded under Section 36, the debenture trustee may instruct such company to fulfill such terms as soon as possible or to make repayment of the principals and interest of the debenture-holder within a time limit as specified ….Read More….
(1) The debenture trustee may collect the service charge from a company for having acted in the capacity of debenture trustee. The amount of such service charge shall be as specified in the agreement concluded between the debenture trustee and the ….Read More….
(1) If a company raising debentures is liquidated or becomes insolvent for any
other reasons, the debenture trustee shall make representation on behalf of the debenture-holder.
(2) In the event of necessity to institute a lawsuit on behalf of the debenture-holder for the repayment of the principal and interest ….Read More….
(1) The share or debenture of a company may be sold or pledged as good as movable property, subject to this Act, the memorandum of association and articles of association.
(2) Notwithstanding anything contained in Sub-section (1), the promoter of a company, other than a private company which ….Read More….
(1) If any share or debenture is sold, subject to Sub-sections(1) and (2) of Section 42, the buyer thereof shall make an application to the registered office of the company , in such format and along with such fees as may be prescribed, to have such debenture or share transmitted to his/her name. The applicant shall also submit, along with such application, a copy of the deed relating to the sale and purchase of ….Read More….
(1) Notwithstanding anything contained in Section 42 or 43, a company may, in the following circumstances, refuse to record any pledge of a share in the register or to effect transmission of a share or debenture where it has been
disposed of:
- (a) If a call on the share ….Read More….
If any person becomes entitled to the share or debenture held by any shareholder or debenture-holder because of his death, being insolvent or otherwise under the prevailing law, and that person so acquiring the title or on whom the title is so devolved makes an application accompanied by an evidence thereof, to the company, in such format and accompanied by such fees as prescribed, the company shall ….Read More….
(1) Each company shall establish a shareholder register and debenture-holder register in the prescribed format and maintain the same at its registered office.
(2) The following matters concerning each shareholder shall be mentioned in the shareholder register as referred to in Sub-section(1), according ….Read More….
(1) If a company asks any shareholder to provide information as to what capacity one has obtained the shares with full voting rights registered in his/her name or whether any other person has invested in the shares registered in the name of such shareholder and where there is another person as the beneficiary of such shares, as to the identity and nature of the title of that person, it shall be the ….Read More….
(1) Unless otherwise altered by a notice, the address of a shareholder mentioned in the shareholder register shall be considered to be his/her real address.
(2) In the event of the change of address of a shareholder, a written notice of the new address has to be given to the registered office of the company ….Read More….
(1) Unless the shareholder register is in such form as in itself to clearly constitute an index of the names of shareholders, every company having more than fifty shareholders shall prepare and keep a separate index of the names of its shareholders.
(2) In the event of any alteration in ….Read More….
(1) If any person subscribes ordinary shares with full voting rights that are five percent or more of the paid-up capital of any public company of which shares that person has held in his/her name or through his/her agent, that person shall be deemed to have his substantial shareholding in such company.
Provided, however, that in ….Read More….
(1) Every company shall prepare and maintain an inventory of the existing shareholders and debenture -holders and persons who ceased to be shareholders or debenture-holders as at thirty days prior to the holding of the........* annual general meeting.
(2) The inventory as referred to in ….Read More….
A company may attach a share registered in the name of a shareholder and dividends payable thereon, as well, for all money due and payable by him/her to the company in respect of that share or for all money due and payable by him/her to the company ….Read More….
(1) An amount for a share shall be paid up within the period of a call made in accordance with the articles of association.
(2) In making a call pursuant to Sub-section (1), a company shall send every shareholder a written notice, in the prescribed format, specifying ….Read More….
(1) Every partner shall pay the amount of call on the shares held jointly in proportion to his/her ownership.
(2) Except where there exists a duly executed deed indicating specific portion owned by each partner in the shares held pursuant ….Read More….
If a dispute arises about the ownership of any share or debenture issued by any company, the person whose name is registered in the share or debenture register maintained by the company shall, unless otherwise proved to be regarded ….Read More….
(1) Subject to the provisions contained in its articles of association, any company may, by adopting a special resolution at its general meeting, make alteration in
its share capital as follows:
- (a) By increasing its authorized ….Read More….
(1) If a company intends to reduce its share capital, it may, by adopting a special resolution to that effect at its general meeting, reduce its share capital by obtaining approval of the Court and making necessary amendment to or alteration in the memorandum of association and articles of association, accordingly.
(2) On receipt of approval ….Read More….
(1) Where a company has adopted a special resolution for reducing its share capital pursuant to Section 57, it shall make a petition to the Court for an order confirming the reduction.
(2) Where a petition is made pursuant to Sub-section (1), the concerned company shall, prior to the hearing of such petition, publish ….Read More….
(1) Except as otherwise provided for in this Section, a shareholder of the company, past or present, shall not be liable, in respect of any share mentioned in the order issued by the Court confirming the reduction of share capital, to pay any amount exceeding the difference between the amount actually paid on the share or the ….Read More….
(1) If the net worth of a public company is reduced to half the paid-up capital or less than that the directors shall prepare an appropriate strategy for the interest of the company and shareholders, as well, within thirty-five days of the knowledge of this matter, and present a separate resolution thereon at the general meeting toe held immediately after the knowledge of such matter.
Provided, however, that where ….Read More….
(1) No company shall purchase its own shares (buy-back) or lend money
against the security of its own shares.
(2) Notwithstanding anything contained in Sub-section (1), in the following circumstances, a company may buy back its shares out of ….Read More….
(1) No company shall provide any loan or financial assistance of any kind to any person for purchasing its own shares or the shares of its holding company or getting entitlement too such shares in any manner.
Provided, however, that nothing ….Read More….
(1) No public company incorporated under this Act shall commence its business
without obtaining the approval to carry on its business.
(2) A public company shall make an application, along with the evidence showing the full payment of calls on the shares, out ….Read More….
(1) A company shall not issue or sell its shares at a discount.
(2) Notwithstanding anything contained in Sub-section(1), a company may, on the following conditions, issue or sell shares at a discount by adopting a special resolution at the general meeting to that effect, not being less ….Read More….
(1) A company may issue preference shares as provided for in this Act, memorandum of association or articles of association.
(2) Except as provided in the articles of association, no shares issued pursuant to Sub-section (1) shall be converted into ….Read More….
(1) A minor who has not attained the age of sixteen years and a person who is not qualified to make the contract under the law shall not be eligible to become the promoter of a company.
Provided, however, that this Section shall not be deemed to prevent a minor or a person who is disqualified under ….Read More….
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