Issue of preference shares

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Querist : Anonymous

Querist : Anonymous (Querist)

27 March 2012 can a private company issue cumulative convertible preference shares at the time of incorporation ??? if yes then is it necessary for it to mention the % of cumulative shares i.e the amount of dividend it carries...? pr it can be mentioned later after the incorporation of the company in the 1st board meeting???

Ajay Mishra

Ajay Mishra (Expert)
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28 March 2012 Hi

Yes, a company can be incorporate with equity and preference shares both. In that case Clause V of MOA will be:

"The authorised share capital of the company will be Rs. 10,00,000 divided in to 60000 equity shares of Rs. 10/- each and 40000 12% Preference shares of Rs. 10/- each."

Regards

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