A board meeting is a formal gathering of a Board of Directors. Most of the organizations, being public or private, profit or non-profit, are ultimately governed by a body commonly known as Board of Directors. The members of this body cyclically meet to discuss strategic matters. A Board Meeting can be called for discussing the topic of allotment of shares.
The Board of Directors has to assign a Committee of Directors known as the Allotment Committee. Once allotment committee provides its report with respect to allotment of shares, the Board then approves such a report and then passes the resolution for allotting shares to the respective applicants.
Once shares are allotted by the allotment committee, the company secretary sends the letters of allotment to the respective members. The allotment letter refers to a letter that notifies the applicant that the company has allotted a certain number of shares to him. This letter of allotment is considered as the share certificate until the issuance of the final certificate.
The company secretary needs to inform all the shareholders that share certificates are ready and would be delivered in exchange for allotment letters and bankers’ receipt confirming payment of the allotment money. The public notice should be issued for the general information of the members.
FAQs
Share allotment is the creation and issuing of new shares, by a Company. New shares can be issued to either new or existing shareholders. Share allotment can have implications for any existing shareholders’ share proportion. Typically, new shares are allotted to bring on new business partners.
– Ordinary shares. These carry no special rights or restrictions
– Deferred ordinary shares
– Non-voting ordinary shares
– Redeemable shares
– Preference shares
– Cumulative preference shares
– Redeemable preference shares
At the most fundamental level, supply and demand in the market determine stock price. Price times the number of shares outstanding (market capitalization) is the value of a company.
Hi @Nandana
e-Form PAS-3 is to be filed with RoC. If the allotment is through Private Palcement, PAS-3 is required to be filed within 15 days of allotment and in case allotment is made to public at large, within 30 days of allotment.
Hope this helps!
What attachments are required with PAS-3
Hi @Nandana
PAS-3 is the return of allotment to be filed with RoC once the allotment of shares is made. Certified true copy of board resolution and a list of allottees must be attached with PAS-3.
Hope this helps!
Who shall sign a share certificate?
Hi @emmy
When shares are issued by a Company, the share certificate must be signed by at least two directors or one director and the company secretary, if appointed.
Hope this helps!
@Sakshi_Shah1 can you help?
Hi @Farzeen
Whenever any company makes any allotment of shares or securities, it is required to file a return of allotment in e-Form PAS-3 to Registrar on mca portal with the complete list of allottees to whom the securities have been issued.
As per the Instruction Kit of filing PAS-3, details of maximum five such allotments can be filed through this eForm. However, if the total number of allotments is more than five, then file another eForm
PAS-3 for remaining such allotments.
Read more about it here - Instruction Kit PAS-3
Hey @Bharti_Vasvani can you please help here
Hey @Gowtham_Raj,
In this case, 2 allottments will be considered, preference share allotment will be considered as one allotment and another as debenture.
Hope this helps!
Hi @harshjain
A share certificate should be signed by either 2 company directors or 1 director and a company secretary.