10% of Bonus Share Capital - 09/05/00
Question
I am the senior management of an offshore company. Recently, my boss is trying to reorganise the company and to raise capital. At the same time, he offers me 10% share of the reorganised company without any consideration in cash. I worry if I need to invest in the company in a form of alteration of capital in the future. What can I do to protect my right? Shall I add any conditions in the article of association?
Answer
In view of the minority in the shareholding of the new company, it is not easy for you to convince the majority to add clauses in the Articles of Association. In future, you may be asked to subscribe more shares in the new company or otherwise, your shares will be diluted.