What is the procedure of converting the cumulative pref. shares into equity?Kindly elaborate the procedure from both end i.e. from the company point of view and from the pref. shareholders point also?
Best Regards
meenu
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conversion of pre. shares into equity
Replies (4)
sir,
Actually the Co. has entered into the Share purchase agreement with ABC pvt. ltd and acquired Optionally convertible cumulative pref shares in 2001.The Co. has not opted for conversion in 2003 to equity.Also the dividend remain unpaid due to non declaration of profits. now the co. just wants to know the rights of pref. shareholders in this case. Articles of ABC also does not contain any rights for pref. shares.
What course of action can the Co. take in this regards?
Kindly comment
Meenu
If we want to change/ amend the articles then what all points we have to check?
meenu
By virtue of provisions u/s 87, cumulative Pref. Shareholders are entitled to vote on any resolution placed before the company at any meeting due to unpaid dividend .
Is there any fix percentage of voting right needs to vote for resolution?
meenu
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