When you register your Private Limited Company according to the Companies and Other Business Entities Act (Chapter 24:31) every shareholder is supposed to receive a share certificate in respect of the shares each shareholder holds.
See also: About Private Limited Companies.
Also every company is supposed to, within two months after the allotment of any of its shares, and within two months after the date on which a transfer of any such shares, is lodged with the company, complete and have ready for delivery the certificates of all shares, allotted or transferred.
Unless specified in the Company’s Articles, your company should issue share certificates free of charge.
This guide will explain about share certificates.
What is a share certificate?
A share certificate is a written legal document signed on behalf of the company as legal proof that you own a certain number of shares shown on the certificate.
What information does a share certificate show?
In respect of the Companies and Other Business Entities Act (Chapter 24:31) Section
“47. (1) Every certificate must specify—
(a) in respect of how many shares, of what class, it is issued;
This states the number of company shares which are owned by the bearer of the share certificate and defines the class of shares (e.g. ordinary shares, preference shares, etc).
“(b) the nominal value of those shares;“
This is the minimum price at which shares can be issued (e.g. ZW$1 or ZW$0.50 etc.) and it can never be issued for less than this value.
“(c) the amount paid up on them;”
although these model articles require the shares are fully paid (i.e. the full nominal value of the shares has been paid by the shareholder), it is possible to also have partly paid shares (e.g. if the nominal value is ZW$1 and the shareholder has only paid ZW$) or unpaid shares (i.e. the shareholder has not paid anything up front for the shares).
“(d) any distinguishing numbers assigned to them”
this is generally the share certificate number.
(2) Certificates must—
(a) have affixed to them the company’s common seal or an official seal which is a facsimile of the company’s common seal with the addition on its face of the word “Securities” (a “securities seal”); or
(b) be otherwise executed in accordance with the Companies and Other Business Entities Act (Chapter 24:31).
Other information which needs to be included on share certificates includes:
- Company name.
- Company number.
- Company’s registered office address.
- Name of shareholder(s)
- Address of shareholder (or first named shareholder)
- Date of issue
See also: Our transfer of shares service.
Cases where a share certificate must not be issued.
You are not required to receive a share certificate when:
- You hold uncertificated shares.
- A share warrant has been issued.
- The articles state that no share certificates should be issued.
- You hold more than one class of shares
See also: Our allotment of shares service.
Replacement of share certificates
“49. (1) If a certificate issued in respect of a member’s shares is-
(a) damaged or defaced, or
(b) said to be lost, stolen or destroyed, that member is entitled to be issued with a replacement certificate in respect of the same shares.
(2) A member exercising the right to be issued with such a replacement
(a) may at the same time exercise the right to be issued with a single certificate or separate certificates; and
(b) must return the certificate which is to be replaced to the company if it is
damaged or defaced; and
(c) must comply with such conditions as to evidence, indemnity and the
payment of a reasonable fee as the directors decide.”
See also: Our replacement of documents
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