Mansi Airi Gambhir enrolled with the Delhi Bar Council in 2009 and holds Masters in Corporate Laws f... Read More
Issuance of Shares At Discount
What Are The Conditions For Issuing Shares At Discount?
- Sector-1, Noida
There are a few mandatory conditions that a company must meet before issuing shares at discounts. This is done to ensure that the discount is reasonable and fair.
Here are some of the conditions: -
Class Already Issued: The shares to be issued at a reduced price must belong to a class of shares that has already been issued.
-Seek Authorization: A resolution shall be passed in the general meeting of a company to authorize the issuing of shares at discount. It shall also be approved by the Company Law Board.
-At Least One Working Year: A company can issue shares at discount only if it has been functioning for a minimum period of one year from the date it was entitled to begin business transactions.
-Issue Shares Within 2 Months: The company shall issue shares at discount within two months from the date of approval by the Company Law Board.
Answered on 28 Sep 2018
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