Queries under section 62(3) for taking loan from directors and promoters with an option to convert into equity shares

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Mar 11, 2024, 7:59:04 AM3/11/24

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Following queries under section 62(3) for taking loan from directors and promoters with an option to convert into equity shares:

Company is a private company and the directors and shareholders are the same persons.

1. Whether execution of loan agreement is mandatory or terms and conditions mentioned in Special resolution are sufficient.

2. Should the power of conversion of loan into equity be in the articles of association of the company?

3. Will a company have to increase its authorised capital before taking such a loan?

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