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The issue of shares is the procedure in which enterprises allocate new shares to the shareholders. Shareholders can be either corporates or individuals.
The debenture is a written instrument acknowledging a debt under the common seal of the company. It contains a contract for repayment of principal after a specified period and for payment of interest at a fixed rate.
Characteristics of a debenture
Types of Debentures
Procedure for Issuing Debentures
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Issue of Letter of Offer or offer letter, receiving applications, allotment of shares are three basic steps of the procedure of issuing the shares.
- Public Issue or Initial Public Offer (IPO)
- Right issue
- Private Placement of shares
- Preferential allotment of securities
- Offer for Sale of securities
Directors are empowered to issue shares by way of Right issue pursuant to the provision of Section 62 and 179 of the Companies Act, 2013
Shares of a listed company and unlisted public companies, registered in India, can be issued to the general public (with SEBI approval)
Private Companies can issue shares to its existing members and to the selected group of persons as decided by the board of directors. However,number of members in case of private company shall not exceed 200 in any case
Debenture can be redeemable or Irredeemable. Besides, some debentures can also be converted into shares.
Yes, debentures are transferable.
A debenture trustee means a trustee of a trust deed for securing any issue of debentures of a body corporate.