US companies

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VINITHA RAJESH (Querist)
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23 October 2009 As per Indian companies Act, a company will have authorized share capital. When the company issues shares, a share cetificate will be issued with the details of number of shares and the face value per share. Every further issue if made to the same person will be done in the same procedure as a new investment.

For US companies, the incorporation certificate shows the no. of shares they are authorized to issue. Break up of face value per share is not specified. Now, I got the information that there is no concept of face value per share in US. They don't provide any documentation for the sharecapital issued.

So, I would like to know what is the actual procedure followed in US for issuing shares (to anyone and in particular to Indian companies). If the information received to me is correct, how do they value the share of the share holder in the company.

CS Vandana Kacholia

CS Vandana Kacholia (Expert)
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24 October 2009 Well its right there is no concept of par value per share in US bcz in US it is termed as stock i.e. capital stock. and you can ask them to send you stock certificate or any zerox of it and that will be proof of your shareholding in that particular company i.e. Mr. x is the owner of 5,000 full paid and non assessable shares of the capital stock of ABC INC.and that stock certificate is same as share certificate.

other views are also solicited.

Thanks & Regards
Vandana Kacholia

VINITHA RAJESH

VINITHA RAJESH (Querist)
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26 October 2009 Thanks for the information.

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