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DO DIRECTORS HAVE TO INVEST TO BE A SHAREHOLDER IN A PLC (Others)

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This query is : Resolved


( Author )
15 September 2010

1.DO DIRECTORS HAVE TO INVEST TO BE A SHAREHOLDER IN A PRIVATE LIMITED COMPANY?
2.IS IT NECESSARY TO PAY SALARIES TO DIRECTORS OR NOT?
3.IS THERE ANY MINIMUM LIMIT WHICH THE SHAREHOLDERS HAVE TO INVEST IN THE COMPANY?
4.SUPPOSE I AM THE DIRECTOR & FIRST SHAREHOLDER OF THE COMPANY.SO IS IT NECESSARY THAT I HAVE TO INVEST IN THE COMPANY OR CAN I START THE COMPANY WITH OTHER SHAREHOLDER'S CAPITAL?


Ankur Garg

( Expert )
15 September 2010


1. Yes…A director may become member of the company by taking 1 share.

2. No it is not necessary

3. No there is no minimum limit prescribed. 1 share is enough to become member of the compay.

4. Minimum paid up capital for a private company is 1 lac. It is possible that you hold only 1% and rest 99% is invested by other person.

Revert if there is any doubt.


AMIT SADANA

( Author )
15 September 2010

thanx a lot Ankur.Please also let me know who are first shareholders or promoters and who will be the actual owner of this company. I mean the director, first shareholders or all the shareholders.

And if the company is making profits then can we pay the dividend to shareholders every month or is there minimum time period required.

Suppose we are total 5 shareholders out of which there are 2 directors who are paid by the company & they are also the shareholders of the company,so they will get the dividend + the salary and rest 3 shareholders will only get the dividend and also if other shareholders are working somewhere else then is it legal that they can be shareholders also.

If every shareholder invests Rs.20,000/- and there are 5 shareholders then is it possible to start a company.

And suppose I am one of the shareholder and later on I want to increase my share percentage in the company then how can I do it.


AMIT SADANA

( Author )
15 September 2010

And suppose we are opening a company whose project cost is 5lacs..then we hav to show in the bank 5lacs or we can only deposit 1lac and start the business.I mean lets suppose I am a promoter and I invested 50,000/- now and later on I will be investing other 50,000/- and other 5 shareholders invested 20,000 each.So the total money collected now is Rs.1.5lacs.So for the remaining 3.5lac,who will be the shareholder.


Ankur Garg

( Expert )
15 September 2010

Subscribers who bring the minimum subscription amount i.e. Rs. 1 lac are the first shareholders of the company. They may be termed as first director. Or first director may be different. Kindly check form 1 and 32 of your company for details filed at the time of incorporation.

Dividend can be paid annually after approval of shareholders in the AGM.
Interim dividend between 2 AGMs is also allowed. Monthly div is not possible.

Yes you can be a shareholder at one time and can simultaneously work elsewhere.

Minimum paid up capital for a private company is Rs. 1 lac. So 5 shareholders with 20000 each can make a company.

If u want to increase your stake in the company u hv 2 options:

1. Another member transfer his shares in your favour
2. Company issue new shares and you buy them.

Regards


AMIT SADANA

( Author )
15 September 2010

I realy appreciate Ankur for your guidance. Actualy I m just 24 and its the first time I am launhing a private limited company.So dint had any knowledge about the procedure and other details.But thanx a lot once again for ur valuable advice.


Ankur Garg

( Expert )
15 September 2010

With 1 lac your company is done.

Now after incorporation law is not concerned from where u arrange money to run the business of the company.

There is no need to make everyone shareholder in the company.


AMIT SADANA

( Author )
18 September 2010

Hi ankur.. Plz let me know that how the dividend is distributed among the shareholders.I mean in what ratio.. and Who declares the dividend?

Also if I open a pvt ltd co. then how much approx. wil be my monthly expenses and one time expenses?Suppose I am registering this company in Faridabad(Haryana) with a share capital of 1lac.How much wil be the total cost?


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