Company terminologies.

(i). What do you understand by Differed Shares?

Differed Shares (founders shares) are company shares which are of nominal value but that entitle the shareholders to take the whole or proportion of the profits after a fixed dividend has been paid on shares.

(ii). What do you understand by Share Warrant?

Share Warrant is the document issued by a company certifying that the bearer is entitled to the shares specified in it, unlike share certificate which is negotiable. 

Note: A share warrant is document under seal issued by company certifying that the bearer of it, is entitled to certain amount of full paid up shares.

(iii). What is a call in Company Law?

A call is a demand by a company under the terms of articles of association or an ordinary resolution requiring company members to pay up fully or in part the nominal value of their shares. 

Note: Unless the articles provide otherwise, calls must be made equally upon all shareholders of the same class. Calls should be distinguished from installments, which become due upon a date predetermined at the time the shares were issued.

(iv). What do you understand by Forfeiture of Share?

Forfeiture of Shares refers an act of surrendering the shares for nonpayment of calls i.e. any shares in which a call has been made but not paid and notice to pay has been served with no response can be forfeited. 

Note: Shares may be forfeited by resolution of Board of directors. 

When shares have been forfeited, shareholder is informed and asked to return share certificate. The company may resell shares returned.

(vi) Minority share.

Minority share is the share the holder of which has few shares. Is the share that holds small percentages.

(vii) Alternate Director.

Alternate Director is a director appointed by the board of directors authorized by the articles or by a resolution passed by the company in general meeting where the original director is likely to be absent for a period not less than 3 months from the state in which the meetings of the board are ordinarily held.

Note: He shall not hold office for longer period than allowed to the original director. Shall the vacate office if the original director returns.

(viii) Subscribers.

Subscribers refers to founders of the company and are ones who sign the Memorandum of Association and they must write opposite to their names the number of shares held by each one.

(ix) Share Capital.

Share Capital is the fund representing the nominal value of shares issued by registered Company.