cpc

death of one of three directors


There are three partners in a private company  - First - 60%  second - 40% (senior citizen- mother of thrid director) and third director has 0% stake. What happens when second director expires without any will (she has total 5 children including third director who has 0% stake?

 
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Practicing Advocate

The 40% shares of the 2nd director will devolve upon her 5 children and the 3rd director's stake in the company shall raise from 0% to 8%.

 
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Corporate Lawyer

Adv. Archana its Cpmpany Law and not HIndu Succession Act. 


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Corporate Lawyer

@ Lakshmiji,

In case of private limited company, it depends on teh proviions of teh articles of associaton, cuz the reight to transfer or vests shares is on the approval of the board of directors.

In case of a public company, again it depends, quite often qualification shares are to be transferred to other directors at proce as deteremined based on valuation done by company

In case of listed company, its based on nomination if filed, or succession certificate/will provided. 


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