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Statutory Regulations of Conversion of Shares into Stock

Statutory Regulations of Conversion of Shares into Stock

 

The following are the statutory arrangements for converting shares into inventory (1) It is necessary to have a provision in the articles of the company for conversion of shares into inventory. If there is no such provision in the Articles of Association, then the company has to make such a provision by amending the Articles. Therefore, if there is a provision in the articles of the company, then any company

 

Can convert fully paid-up shares into inventory. (2) A company may by its ordinary motion (i) convert its fully paid-up shares into equity or (ii) re-convert the stock into fully paid-up shares of any value.

 

(3) The stock can be transferred in the same way as the fully paid-up shares are transferred but the Board of Directors may fix a minimum amount of the transfer of the stock, from which a lesser amount cannot be transferred. Provided that this minimum amount shall not exceed the face value of the shares from which the stock is formed. (4) The same right to vote in the meetings of the company, to get profits and in other matters to the stockholder.

 

which will be received by the shareholders. (5) The rules of the company which apply in respect of fully paid-up shares shall also apply to the stock.

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