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Conversion of unsecured loan to equity share capital

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Querist : Anonymous

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Querist : Anonymous (Querist)
09 January 2016 Dear Sir,

My query is, whether valuation of share as on the date of conversion is required for a unlisted private company, In case of conversion of Unsecured Loans, extended by the current equity share holders. ?

Or

Conversion is possible without valuation just by giving away shares at face value plus some premium amount per share, arbitrarily.

Please note current directors and shareholders are same in whose name conversion is taking place.

Awaiting response.

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CS Divesh Goyal

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CS Divesh Goyal (Expert)
09 January 2016 You can convert on the face value or the terms decided by the SR at the time of acceptance of loan
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Querist : Anonymous

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Querist : Anonymous (Querist)
09 January 2016 There was no agreement at the time of extending of loan.

Also, please share detail procedure to do the same.
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Querist : Anonymous

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Querist : Anonymous (Querist)
11 January 2016 Please reply at the earliest
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Querist : Anonymous

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Querist : Anonymous (Querist)
11 January 2016 Please reply at the earliest

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