Understanding the Position of Promoters under the Companies Act, 2013
Introduction Establishing a company is a complicated process that involves several stages. At the initial “promotion” stage, promoters conceive the idea of starting a business and begin the incorporation process. The term “promoters” has previously been used without a specific definition in Indian company law until the Companies Act of 2013 (“Act”) specified their role […]
A CASE FOR DECRIMINALIZATION OF DISHONOUR OF CHEQUES
By Harsh Rohan Sistla ABSTRACT: The economic landscape of India, like many countries worldwide, has been profoundly impacted by the COVID-19 pandemic. As the nation grapples with economic downturns and challenges, the Ministry of Finance has proposed significant reforms to alleviate burdens on businesses and streamline legal processes. Among these reforms is the contentious issue […]
Exploring Equity Options for Advisors in Startups
In the dynamic world of startups, securing experienced advisors can be crucial for success. Offering equity as compensation can be an attractive proposition for both advisors and founders. However, navigating the complexities of equity transfers requires a strategic approach. Let’s explore three options for giving advisor equity and the considerations associated with each. Option 1: […]
Valuation Requirements Under Companies Act 2013
The Companies Act 2013, a landmark legislation in India, outlines various provisions and regulations governing the functioning of companies. Among these, valuation requirements play a crucial role in different scenarios such as preferential issue of further shares, non-cash transactions, compromise or arrangements, purchase of minority shareholding, and the submission of reports by Company Liquidators. In […]
Understanding Various Financial Instruments under the Companies Act, 2013:
Introduction: A critical facet of a company’s structure revolves around the issuance of diverse financial instruments, each crafted to serve distinct purposes. In this exploration, we will take a high-level dive into the varied instruments outlined under the Companies Act, 2013. Equity Shares: Purpose: Represents ownership with voting rights and dividends based on company profitability. […]
Decoding Main Board IPO Regulatory Nuances in India
Embarking on a Main Board IPO in India demands a meticulous understanding of intricacies. Here’s a high-level guide to comprehend the complexities: 1. Valuation: Conducting thorough financial scrutiny and market analysis to anticipate IPO valuation. 2. Existing Investors / Shareholders: Understanding the role of existing investors/shareholders in the entire process. 3. OFS vs Primary: Analyzing […]
Retaining Talent: Unlocking Employee Incentives for Organizational Success
Introduction: In the dynamic landscape of job opportunities and heightened competition, companies face the ongoing challenge of retaining their valuable talent. In this article, we explore effective means to keep employees motivated and engaged through tailored incentive programs, focusing on Employee Stock Options (ESOP), Sweat Equity, and Phantom Stocks. Employee Stock Options (ESOP): ESOPs serve […]
Demystifying Startup Equity Investment Terms:
In this article, we aim to delve into key concepts, shedding light on the language that shapes the startup investment landscape. 1. Premoney Valuation: Premoney valuation, the estimated value of a company before external funding, sets the stage for investment negotiations. If a startup is valued at $5 million before a funding round, its premoney […]
Navigating Global Expansion: Legal Framework for Flipping Corporate Structures
In the dynamic landscape of global business, the growth of companies often leads founders to contemplate flipping their structures, establishing holding companies outside India for easier access to global investors and overseas listings. This strategic move involves various considerations, necessitating a comprehensive understanding of legal frameworks and potential implications. This article explores key facets surrounding […]
Navigating the Crucial Phases of a Comprehensive Fundraising Transaction.
Embarking on fundraising involves strategic considerations across key stages for success. Let’s explore these phases: 1. Termsheet: The foundation is laid with the termsheet, a preliminary, non-binding document outlining fundamental terms like valuation, investment amount, and governance structures. It sets the stage for negotiations and provides a blueprint for subsequent steps. 2. Due Diligence: Legal […]
