Page 249 - DMGT407Corporate and Business Laws

Corporate and Business Laws

Notes
11.3.6 Cumulative Convertible Preference Shares (CCPS)
11.3.7 Deferred or Founder’s Shares
11.3.8 Non-voting Shares
11.3.9 Employee Stock Option Scheme/Employee Stock Purchase Plan
11.3.10 Issue of Shares at Par, at Premium and at Discount

11.3.11 Bonus Shares
11.3.12 Rights Shares
11.3.13 Conversion of Loans or Debentures into Shares
11.4 Share Capital

11.4.1 Meaning of Share Capital
11.4.2 Alteration of Share Capital
11.4.3 Reduction of Capital
11.4.4 Procedure for Reduction of Capital

11.4.5 Reduction of Share Capital without the Sanction of the Court
11.4.6 Purchase of its own Shares by a Company (s.77)
11.5 Raising of Capital/Issue of Shares
11.6 Summary

11.7 Keywords
11.8 Review Questions
11.9 Further Reading

Objectives

After studying this unit, you will be able to:

Describe the meaning and registration of prospectus;
Discuss about the allotment of shares;
Recognize the concept of share and share capital;

Explain the method of alteration of share capital.
Introduction

A prospectus, as per s.2 (36), means any document described or issued as prospectus and includes
any notice, circular, advertisement or other document inviting deposits from the public or
inviting offers from the public for the subscription or purchase of any shares in or debentures of
a body corporate.

A share “as a share in the share capital of a company and includes stock except where a distinction
between stock and share is expressed or implied”. It means the capital of a company, or the
figure in terms of so many rupees divided into shares of a fixed amount, or the money raised by
the issue of shares by a company.

242 LOVELY PROFESSIONAL UNIVERSITY