8 ALLOTMENT AND TRANSFER OF SHARES ALLOTMENT OF SHARES Meaning ; . 4 An application for shares by investors is an Offer to Purchase shares when the company makes an allotment to the applicant, he bec and shareholder of the Company. Allotment of shares j: Mes S the process Of distribu s 2 —"S Of distrity shares to applicants on the basis of Fesolution Passed by board of directors oo y Rules of Allotment PS Orta Takei The rules of allotment are as under: Se Ba oO} revalche 1. Application for Allotment Pe hot) few, An application for allotment of shares or debentures cal an amount less than-a-nominal 8 nee INNot be @ nominal amount Specified by the sso he wr Commission may speci i fe iptiot, This #, eNy»-@Pplication 'S @ part of the Prospectus, All declarations inade by thes form ce») |, Shall be pinging onhim. (Sec, 67] nen Yo Spess by eg § "awe" 22 Minimum Subscription irect ct pr Proceed to allotment. If Mount is fixed, the whole amount of the share cep Wile peBALepnsidered as minimum subscription. (Sec, 19(1)) Ww Rebavmene of Money -\ Where a company issues any invitation to the public to s 2 Ley shates, it shall refund the money in the tick aw i Ubscribe for its case of the snaccepted oF unsucoseety ications within the time as May be specified. If the refund is no} ; Not made within Sbecified, the directors shall be liable to fine, (Sec. 63) . sCuritieg’ ET yaneiachey bhi App. te 1, K "Securities Exchange 9 If pasrrchy A465 Rhy. ts < reactor} len prospectus states that dn pplication lees deen OF will be made G5 ith a estta remeron ost SELIM Securities oS Me Leith tt XM y heva \f application for registration with stock ot not Made Within 7 days e wit catter the issue of prospectus. ects PSE Be etal eee ar 0/2! Sr foe aa Closing of the Subscription lists, or Such longer 79-42 day, s_ extended by ecurii change. ir: | ech A thy ‘ ‘eu 58 rh Pr ra | t Pe et Nats Sow WS Scanned with CamScannerOO] -ictment and Transfer of Shares . If securitis = ; Boi tre secules exchange does not grant permission, the money received Li feet efunded within 8 di all be forthwith repaid without surcharge. If money is not ty : ne meas, the directors are liable to repay with surcharge. >, Ksfeut befine rest ; ; 5. Sched nk aXe e a hl Bank Ne — head al tae ey osited in a ae tw : | ; All money Teceived from appli pplicants for shi separate bank account in a scheduled bank. In cate are every. officer responsible shall be liable to a penalty of level 2. [Sec. 69(3)] 6, Return of Allotment When a company makes an’ i shall, 7 one y allotment of its shares, the co! hall, 4 within 45 days: (Sec. 70] [-f A-ilatucect ts 2 Ween vy Heady te dopey 2 File with the-registrar a return of the allotment. stating the number~and- Fidroumoring’ amount of the shares, particulars of each allottee, and amount paid Fe n each share. shares are allotted for cash, submit a report from its auditor stating that the .d in full and shares have been b. Jt fe A ount of ponsideration hag been receive fs i sai PA ipitce | Revkeh Shaves leicted 7 >t shares are-allotted Tor otherwise than in cash, submit a coPY of the fh ydocument showing the transfer ‘sf non-cash asset, copy of contract, pasresite lectual property or other consideration, ‘Copy of thé valuation report in real Slfespetl of which that allotment was made. the number and nominal amount of in case of bonus shares, a return stating eee Snares -alTOWEd.- particulars of allottee ‘with a copy of the resolution Skee aythoxzing such issue. = ares at discount, a copy of the resolution authorizing peer case of issue of sh Krone te. Where discount rate exceeds 10%, 2 copy of the order of the a ghyis: Qo S Glare N moe § Sloth be 4 fob Every share in a company bist Agena by its distinctive HUMbET- [Sec, 60] | Every company shall issue cert i deliver the certificates to the person at his registered a‘ . having a share capital shall be Scanned with CamScanner| ao = Movedhe. Allotment and Transfer of Shareg as J 3 = ae See or other costs of any member in a comp: movable property transferable in the manner provided by the a company. (Sec. 61] tered {shy ei Shares Certificate to be Evidence =— "eS e 2s Meleng A certificate, if issued in physical form under common Sealy or j book-entry form, or shares held ices depository systems evidence of the title of the Person to such shares. (Sec, 62) Evo Co's having Cap 5 Should houce)) -Pluyit Book Entry Form —> Se Co: Bhtsag AMY fewae Cauca Every company having Sharé capital'shall hav shares in the book-entry/ form only. Every existing company shall replace its physical shares with book. €ntry form within a Period of 4 years from the commence! ‘ment of this Act, The Commission May notify different dates for different classes of companies. The | any shall by ticles of the ISSued in Shall be prima facia Commission may extend the period for another 2 years. [Sec. 72) Duplicate Share Ce icate iorke. The rules of duplicate share certificate are as follows: LYS a gdlewA duplicate of a certificate of Shares, or other securities, shall be issued by | Wer 2 the company within 30 days from the date of application if the original: | + \_ > 4. Is lost or destrayed=or | >>. Defaced, mutilated or torn and surrendered to the company. fi 2 The’ company after making-inquiry shall issue duplicate certificate, The Cidage Fe company may charge fee and expenses incurred on such inquiry. i “= ex 3. If the company is unable to issue duplicate. certificate, it shall notify the \eucd\-...2teasons within 20 days to the applicant. (Seo. 73 EN GH awe apa’ == TRANSFER OF SHARES ¥ fra bry lew es 3 ° Pe BO Smarts LO” nin: ip i pe lea a of shares is the sl pang of Ownership in shares from one person to another. When transfer of shares occurs by operation of law, it is led tanstneSiore Transmission occurs in-case of _death-or-insanity of the sharshaeee ona can freely transfer his shares to any persona wever, a mpany may impose certain restrictions on transfer of share by ‘its pfivate cor . articles. sfer : Rules renee are rules of transfer of shares 4. Transfer of Shares + registration of the transfer of shares ang debentu i the transferee. The com, res \ An application feror oF t 5 sad cobontue i be made either by I te and: (See. 74] within eS 5 days complete the pro’ ; Le ; | *yaiee. \W Scanned with CamScannerallotment and Transfer of Shares a. Deliver the certifi enter the na ificate to the transferee at his regist - ee transferee in its registe ff ort adress Pete dale 7 6 rans ro ¢ ae a as 2 Conversion of physical shares ond other ~ Erker vane in fe ; th mpany shall, within 10 days tra other securities into book- 7 toacentra epository, —D toto an insfer shares or other securities pegs, very company shall maintain ppaeatic bere eae reese f oprities, at its registered office which shall b fansfers of shares and ot 5 heer 5a eae oS @ open to inspection by the Refusal of Transfer >> & ret 7 > Notre fue tet 4c hey Py) i ee shall not refuse to transfer any etree ounties oe " Bester th feed is invalid. If a company refuses to register a transfer of tu eat ies cae er securities, it shall, within 15 days send to the transferee a wii # refusal indicating reasons for refusal. (Sec. 75,77] ahh? dau a Pn Feu d rep 4g, Transfer to Successor —1 tf Ae ath j - The shares-or other securities of a deceased’ member shall be transferred % Ap, 7% | in favor.of the successors ‘and their names shall be entered in the Tegister of Moy members. [Sec- 78) . 4, Transfer to Nominee ‘ ‘The rules are as unde vay Ae anes & pense facie transfer to facilitate the transfer of shares tothe a. A member may no hinate a person legal heirs in the event of his death. Ve icn nated, pil! bE Can sidered meabey er’ shall be deemed as 2 b. The person nominated, after thedeath of the mem! member of compan: ferred to the legal heirs.___ Oeuf y tll the shares are trans\ c. If the deceased was a director of the company, not being a_liste’ s director of the company. . of company, the nominee shall also act a: e d. Th in to be nominated shall be a relative of the member nai oat sister and ‘son or daughter. [Sec. 79] pa nail mother, brother, spouse, father, 10 Transfer intimation of the . Appeal against - The transferor or transferee, r the person who gives i ‘ation of law, aggrieved by the refusal of transfer may appeal Appa ( of the date_of refusal. Thesis 44, eriod of, e_date_of = § concerned and $0 da, unity-oF hearing to the P: d by the company. The transmission by ope" de opport 0 mad sion should be registere' Qo # f the order. Sfest ¢ to the Commission Wi Commission shall prov! within a P' order that the transfer oF transmis: . company shall act upon the decision within 45 days of the receipt ol Tet [Sec. 80] - , Aree & De . Important Terms llows: Ge TM a ‘Some important terms are as follows: Aeciriny fg as 4. Underwriting Commission MS 4 reement is an agreement between the company 5 5 > ‘An undenwriting 29 Scanned with CamScannerAllotment and Transfer of Shares 62 i i t purchased by the Public. § agree to buy shares if they are not purchased by the = Such oe See underwiiters. The commission which is paid to underwriters jig pee. ~ called underwriting commission. - 2. Brokerage <2 te Sel\y slharcy: Net Sf A rokeragé § t is fee paid to a person who sells shares or debentures a behalf_of the company. The broker is not liable to take up the shares of the company himself. ——_ aa 3. Lien on Shares Lien isthe right to retain Property of some rovide that the company has a lien on all shares of its jount Payable on shares or on any amount due from the ‘ y n jen, Ow Share Joyal ; pin Eels Pagel The articles of @ company may provide for forfeiture of shares on default of payment bya shareholder in respect of any amount outstanding on shares. Agckicle ney AOU Nhe phouibion Be & iat } Questions ’ CoE fe ptm 9 of allotment of shares? What ard the ruled Anat Asit ‘one who owes a debt or obligation. The articles p members in respect of a members to the conipanté 4. Forfeiture of Shares 1. What is the meanin of shares? What is return of allotment? Explain the rules regarding transfer of shares. a Write a note on lien on brokerage and underwriting commission. fon Scanned with CamScanner