The Memorandum of Association (MOA) is the official document that defines the relationship between the company and its shareholders, including how much capital each shareholder invested in the company, what their expected return on investment will be, what percentage of voting power they have in the company, whether they are required to make any future investments in the company (to maintain their percentage of ownership), etc. One important thing to remember about the MOA is that it’s not legally binding until you have followed through with all steps in incorporating your business properly, which makes the MOA only a rough draft at this point.
Name of Company
The name of the company should be chosen carefully, as it will be used on all official documents. Once you have decided on a name, you can file to make it official. The MOA must state the company's registered address and the names of its directors. In order for the company to do business in India, it is also necessary to obtain an authorization from the Registrar of Companies (ROC). There are several forms that need to be filled out and submitted, depending on your business structure. Finally, submit copies of identification documents for each director (one copy each) with your application form at your nearest ROC office. They will process your application within 48 hours if there are no problems found during verification.
Registered Office
The registered office is where the company's MOA is kept on file. It is also the place where important documents, like share certificates, are kept. The registered office can be changed by a resolution of the shareholders. However, this can be a difficult process, so it's best to consult with a lawyer before making any changes. In India, the Registered Office needs to be in one of these cities - Delhi, Mumbai, Chennai or Kolkata. You will need to complete form 1C and file it at your chosen city’s registrar’s office.
Issuing Shares
A company must file their MOA before they can issue shares. The MOA defines the company's relationship with its shareholders. The MOA must be filed with the Registrar of Companies (ROC). The ROC will then issue a Certificate of Incorporation (COI). The COI will state the number of shares that the company is authorised to issue.
Subscription for Shares
A company must file the MOA with the Registrar of Companies (ROC) before it can commence business. The MOA must contain the names and addresses of the subscribers, as well as the number and class of shares each has agreed to take. The MOA also sets out the company's objects, or the business activities it intends to pursue
Names and Addresses of First Directors
The first step in incorporating a company in India is to file. The MOA must contain the names and addresses of the company's first directors. These directors must be resident in India and at least 18 years old. The MOA must also state the amount of money each director has invested in the company. fileforindia, an Indian based e-commerce website, can help you incorporate your company by submitting your MOA.
Specification of Directors' Powers, Duties, etc.
Section 7 - Removal of Directors by Members: Any director may be removed by resolution at a general meeting duly called. A director may be removed without cause if they fail to attend two consecutive meetings without good reason or fail to comply with the MOA without giving reasonable notice.
Section 8 - Resignation of Directors: Any director may resign by giving written notice to all other directors stating their intention and shall cease from office when his resignation has been accepted as prescribed in Section 9 below.
Section 9 - Director's Notice: The Board may accept a director's resignation by notice in writing signed by them accepting the same.
Section 10 - Altering Powers, Duties etc.: Subject to provisions of this MOA, the Board may alter any power, duty or responsibility vested in it under this MOA provided that any alteration does not materially affect a director’s ability to discharge those functions effectively and efficiently.
General Provisions as to Meetings and Quorum
A shareholder meeting may be held anywhere in the world as long as all shareholders receive proper notice and have an opportunity to attend. A quorum is not required for a shareholder meeting, but if one is not present, any business that transpires must be approved by a majority of shareholders in attendance. If you are planning on holding a shareholder meeting, you will need to file at least 21 days in advance.
Formalities Attending Allotment, Transfer etc. Of Shares in a Company
Manner in Which a Director May be Removed From Office etc.
A shareholder or shareholders representing not less than one-third of the total voting power at a general meeting may requisition an extraordinary general meeting for the purpose of removing a director from office. The notice of such meeting must state the intention to remove the director from office and must be signed by the requisitionists and deposited at the registered office not less than 21 days before the date of the meeting.
Consequences of Failure to Observe Provisions as to Allotment etc. of Shares in a Company or as to Voting at Meetings
If a company fails to observe the provisions of its memorandum or articles as to allotment or transfer of shares, or as to voting at meetings, the company and every officer of the company who is in default shall be liable to a fine not exceeding fifty ringgit. If any such contravention continues after conviction, the offender shall be liable on conviction for a further offence to a fine not exceeding five hundred ringgit for every day during which such contravention continues.
Inspection by Members
As a shareholder, you have the right to inspect the company's books and records. This includes the MOA. To do so, you must submit a written request to the company. The company must then provide you with a reasonable opportunity to inspect the documents. You also have the right to make copies of them at your own expense.