Draft Board Resolution for Preferential Allotment of Shares


As per the provisions of section 62(1)(c) of Companies Act, 2013 where at any time, a company having a share capital proposes to increase its subscribed capital by the issue of further shares, such shares may be offered to any persons, if it is authorised by a special resolution, whether or not those persons include the persons referred to in clause (a) or clause (b) of section 62(1), either for cash or for a consideration other than cash, if the price of such shares is determined by the valuation report of a registered valuer subject to such conditions as may be prescribed.

Draft Board Resolution for Preferential Allotment of Shares

RESOLVED THAT pursuant to the provisions of section 23, 42 & 62 and other applicable provisions, if any, of the Companies Act, 2013 (including any amendments thereto or re-enactment thereof ) (the “Act”) article…… of the Articles of Association read with rule no 14 of the Companies (Prospectus and Allotment of Securities ) Rules 2014 and rule no 14 of the Companies (Share Capital and Debentures ) Rules 2014 and subject to such approvals, consents, permissions and sanctions, if any, of the Government of India, Reserve Bank of India, Foreign Investment Promotion Board etc. , and any other appropriate authorities, institutions or bodies, as may be necessary, the consent be and is hereby accorded to create, offer, issue and allot, in one or more tranches, equity shares for an amount upto Rs…………….., inclusive of such premium and on such terms and conditions as the Board may deem fit from time to time and at such price being not less than the price determined in accordance with the valuation guidelines prescribed by the Act, to person including existing members of the Company.

RESOLVED FURTHER THAT the issue to the holders of the Shares shall be, inter alia, subject to the following terms and conditions:

1.    the shares to be so created, offered, issued and allotted shall be subject to the provisions of the Memorandum and Articles of Association of the Company;
2.   the equity shares proposed to be issued shall rank pari-passu with the then existing equity shares of the Company in all respects including dividend;
3.    the offer or invitation of shares shall not me made to more than ……. persons in aggregate in a financial year and
4.   the value of such offer or invitation per person shall be with an investment size of not less than Rs ……….. of face value of securities 

RESOLVED FURTHER THAT the draft private placement offer letter pursuant to which the offer or invitation to subscribe the Shares of the company will be made , a copy of which is laid down before the meeting and initialed by the chairman for the purpose of identification be and is hereby approved. 

RESOLVED FURTHER THAT the Board be and hereby constitute a Private Placement Monitory Committee consisting of Mr./ Ms………. [name of person] director & Mr./ Ms………. [ name of person] director  for the purpose of 

1.    determining the form and manner of the issue, including the class of investors to whom the shares are to be issued and allotted,
2.     number of Securities to be allotted, 
3.     issue price, face value, and
4.   to settle all questions, difficulties or doubts that may arise in regard to the issue, offer or allotment of shares and utilisation of the issue proceeds as it may in its absolute discretion deem fit.
5.   to appoint such consultants, underwriters, bankers, professionals and intermediaries and all such agencies as may be involved or concerned in such offerings of shares and to remunerate them by way of commission, brokerage, fees or the like and to enter into and execute all contracts, agreements, arrangements/MoUs/documents with such agencies as may be required or desirable in connection with the issue of Shares. 
6.    To open a separate bank account for purpose of receiving the subscription amount

RESOLVED FURTHER THAT Mr. / Ms………. [name of person] director will act as the chairman of the Private Placement Monitory Committee  and Mr./ Ms. ……….., company secretary shall act as a secretary to the committee

RESOLVED FURTHER THAT Mr. / Ms………. [name of person] director/company secretary be and is hereby authorized to maintain the records of private placement offer letter in Form PAS-4 and file the same with the Registrar in Form PAS-5 within prescribed time and fees.

"FURTHER RESOLVED THAT for the purpose of giving effect to this resolution, Shri ………………….. of the Company be and is hereby authorised, on behalf of the Company, to do all acts, deeds, matters and things as deem necessary, proper or desirable and to sign and execute all necessary documents, applications and returns for the purpose of giving effect to the aforesaid resolution along with filing of necessary E-form with the Registrar of Companies.”

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