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Black Citizen

21 Points Posted on 19 April 2016

I'm one of seven subscriber to memorandum of a public company registered this year under new co. Act. Co. has started it's operation. I had initially agreed to subscribe to 100 shares of this companyin MOA. And after incorporation, I did so. Now I'm member of this co. for 100 shares and there are no other members except us 7 primary subscribers each with 100 shares. Now I would like to transfer all my shares to a person who is also a subscriber in this company and like to exit from membership of this co, can I do so? If not all, can I transfer 99 shares to him and keep 1 share with myself if I'm not allowed to sell all?

Pls replysoon.TIA.

Replies (1)

Jatin Bajaj

1920 Points Posted on 19 April 2016

Yes, you can transfer 100% of your shares to the subscriber of this Company and you can exit from the membership subject to the condition that a new person should sign the agreement to become the member of the company and name of such person shall be entered in the register of Member of the Company ( AS PER SECTION 2 (55) (ii)) of Companies Act 2013.

In the above situation both the criteria will be fulfilled , Firstly the Public Company will have minimum of 7 members after you will exit, i.e a new member will be employed without giving any share and Secondally you can easilly exit from membership and transfer 100 % of the Shares to the Subscriber of the Company.