Securities certificates are critically important as:
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They are the evidence of ownerships and rights in the company
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Must be issued to security holders
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Must be in accordance with the securities register which must be available for inspection by interested parties.
40 (4) Subject to subsections (5) to (7), when a company has received the consideration approved by its board for the issuance of any shares—
(a) those shares are fully paid; and
(b) the company must issue those shares and cause the name of the holder to be entered on the company’s securities register in accordance with Part E of this Chapter.
Securities certificates may and are required to be issued only when the securities fully paid.
Details to be included:
50 (2)(b) with respect to certificated securities—
(i) the names and addresses of the persons to whom the securities were issued;
(ii) the number of securities issued to each of them;
(iii) the number of, and prescribed circumstances relating to, any securities—
(aa) that have been placed in trust as contemplated in section 40 (6) (d); or
(bb) whose transfer has been restricted;
(iv) in the case of securities contemplated in section 43 [43. Securities other than shares] —
(aa) the number of those securities issued and outstanding; and
(bb) the names and addresses of the registered owner of the security and any holders of a beneficial interest in the security; and
(v) any other prescribed information.
51. Registration and transfer of certificated securities.—
(1) A certificate evidencing any certificated securities of a company—
(a) must state on its face—
(i) the name of the issuing company;
(ii) the name of the person to whom the securities were issued;
(iii) the number and class of shares and the designation of the series, if any, evidenced by that certificate; and
(iv) any restriction on the transfer of the securities evidenced by that certificate, subject to item 6 (4) of Schedule 5;
(b) must be signed by two persons authorised by the company’s board; and
(c) is proof that the named security holder owns the securities, in the absence of evidence to the contrary.
(2) A signature contemplated in subsection (1) (b) may be affixed to or placed on the certificate by autographic, mechanical or electronic means.
(3) A certificate remains valid despite the subsequent departure from office of any person who signed it.
(4) If, as contemplated in section 50 (5), all of a company’s shares rank equally for all purposes, and are therefore not distinguished by a numbering system—
(a) each certificate issued in respect of those shares must be distinguished by a numbering system; and
(b) if the share has been transferred, the certificate must be endorsed with a reference number or similar device that will enable each preceding holder of the share in succession to be identified.
(5) Subject to subsection (6), a company must enter in its securities register every transfer of any certificated securities, including in the entry—
(a) the name and address of the transferee;
(b) the description of the securities, or interest transferred;
(c) the date of the transfer; and
(d) the value of any consideration still to be received by the company on each share or interest, in the case of a transfer of securities contemplated in section 40 (5) and (6).
(6) A company may make an entry contemplated in subsection (5) only if the transfer—
(a) is evidenced by a proper instrument of transfer that has been delivered to the company; or
(b) was effected by operation of law.
