Prospectus may be defined as any notice, circular and advertisement or any other document inviting offer from the public for the purchased of its shares and debentures. Only public company has the right to issue the prospectus. It is issued to the general public to give knowledge about the company and public easily known terms and condition of the investment. Private company can’t issue prospectus because government gives no right to the private company to invite the gen. public for purchased their shares.
Private company can’t issue prospectus because government gives no right to the private company to invite the gen. public for purchased their shares.
A prospectus is defined as,” any prospectus, notice, circular, advertisement, or other document inviting offer from public for subscription of purchase of any shares or in body of in corporate”.
Contents of prospectus:
· Name and address of the company.
· Main objective of the company.
· Rule and regulation of the company.
· Name and as well as occupation of director of the company.
· No. of classes of address shares:
1. Preferences shares
2. Equity share
· The time of the opening and closing of the subscription list.
· Date and mode of redemption of preference share.
· Name and address of the promoter.
· Name and address which are already part or shareholder of the company.
· Proper detail about the services which are provided by the company.
· In prospectus, detail how many profit earned in the previous year.
· The name of the underwriter must be mentioned in the prospectus.