Why you need Share Certificates and Shareholders Agreement
Do you need to split the ownership in your Company? It is required by the Companies Act of 2008 that each Shareholder in a Company has a Registered Share Certificate. If not, a Shareholder has no legal evidence that he / she owns any shares in a Company - even though they are the Director of a Company.
Normally a company would issue about 100 of a 1000 shares to shareholders. This is called ‘Issued Shares’. Depending on the growth plans of a new company, it is wise to issue a limited amount of shares to the current shareholders / investors.
This leaves space for future growth. For example, if the MOI allotted 1 000 shares, the Directors should authorise only a small percentage initially – say 100 shares (10% of the total). If the two shareholders each wants 50% stake holding, each will own 50 shares.
This allows the company to take on new partners easily if required in the future.
The Share Certificate is basically the legal document which acts as legal evidence that a specific person owns an amount of shares in a company.
If you need assistance with setting up your share certificates and shareholders agreement, Sign up for a free consultation by following the link here: https://companypartners.co.za/contact...