First of all, the first moment when a contribution of money is made to a company corresponds to its incorporation phase. In fact, to become a partner in a new company, a person must make a capital contribution. This contribution may consist of a payment of money (a cash contribution) or a contribution of property of a nature other than money (a contribution in kind).
To make a contribution in cash during the incorporation of the company, several steps are necessary:
- To begin with, the founding partners must agree on the capital contributions of each participant;
- Then, it will be necessary to write the draft articles of association of the company, in which each partner will undertake to make the agreed contributions;
- Each partner pays his contribution of money into a blocked account opened in the name of the company being formed;
- The definitive statutes of the company are then signed by all the founding partners, the company is then incorporated;
- Finally, the founding partners carry out the procedures for registering the company: business creation form, notice of incorporation in the journal of legal announcements, etc.
In return for their capital contributions, the partners obtain securities (shares or shares).
Completion of a share capital increase
The incorporation phase of a company is not the only time when partners can make capital contributions. Once the company is created, the partners have the possibility of carrying out capital increases. Through this operation, the amount of a company’s share capital is increased. The latter receives new resources from the partners with a view to consolidating its own funds.
To carry out a capital increase, several steps are necessary:
- The evaluation of the value of the company’s securities, which will be used to determine the subscription price of the new shares or shares;
- The proposal, by the managers, of the increase in share capital and its implementation methods;
- The holding of an extraordinary general meeting, during which the partners of the company will decide on the increase in share capital proposed by the managers;
- The payment, by the partners, of contributions in cash into a blocked account opened with the bank of the company;
- The drafting of the minutes of the meeting which records the completion of the increase in share capital;
- Updating the company’s articles of association;
- The declaration of the change made at the level of the company to the registry of the commercial court (form M2), accompanied by all the necessary supporting documents.
Importance of Finance and Investment for a company