There are several methods of becoming a member or obtaining membership in a company. A person can become a member of the company by any of these methods. Following are the main methods
(1) By signing on the memorandum, it is well known that every company has to make memorandum for the amalgamation of the company. This memorandum must be signed by at least 7 persons in the case of a public company and at least 2 in the case of a private company. The persons who sign this memorandum become the members of the company. Such members are also known as the initial or founder or statutory members of the company. The persons signing the Councilor Memorandum are deemed to be members of the company from the date of its amalgamation. As soon as the company is amalgamated, their name is entered in the register of the members of the company.
(2) By Allotment – Ordinarily any person accepts the membership of the company by making an application in writing for the shares and after the allotment of shares is done by the company.
(3) By transfer, any person acquires membership of the company by buying shares in the open market and registering his name.
(4) By Succession On the death, lunacy or bankruptcy of a shareholder, his shares are transferred to his successor and the successor becomes a member of the company.
(5) By Estoppe – If any person discloses his membership in writing or permits his name to be entered in the register of members, he shall be deemed to be a member of the company.
(6) By having share for consideration other than cash – If a company buys another person’s ongoing business and issues shares in consideration thereof, then the person selling that business also becomes the holder of the shares. As a result, such person also becomes a member of the company.
(7) By Conversion of Debentures into Shows If companies issue convertible debentures, then after a certain period, shares are issued against these debentures by the company, as a result of which such debenture holders also become shareholders or members of the company. go.