EZYFIND Apps for

Submit your enquiry online for REAL TIME assistance !

How it works?

Register and post your enquiry online for prompt assistance.
Your request is private and only shared with Attorneys / Lawyers registerd on www.LawyersEzyFind.co.za

STEP - 1


Get started with a simple registration. (Your request is not posted on social media if registering with facebook, google or linkedIn)

STEP - 2


Submit your detail enquiry with supported documents if needed

STEP - 3


Lawyers / Attorneys will respond via the website or mobile app

STEP - 4


Confirm Lawyer / Attorney & get your case resolved

Find a Law Firm / Attorney

Free Download - Powers of attorney

Power of attorney to enable company to be registered Power of attorney to enable section 21 company to be registered Power of attorney for registration of external company


incl VAT

Free Download - Deed of transfer clauses

Deed of transfer party descriptions as well as preparation clause.


incl VAT

Free Download - Software development agreement

Memorandum of agreement whereas the customer wishes to improve and automate their existing manual and computerised procedures.


incl VAT

Free Download - By the owner of the land from which the rights to minerals have not been severed, or where the owner of the land himself holds the rights to minerals in respect of the land under a certificate of rights to minerals: the option granted being to acquire the land inclusive of all mineral rights as held by the owner

By the owner of the land from which the rights to minerals have not been severed, or where the owner of the land himself holds the rights to minerals in respect of the land under a certificate of rights to minerals: the option granted being to acquire the land inclusive of all mineral rights as held by the owner


incl VAT

Free Download - Certificate for preference share

Certificate for Preference Share

Shares can typically be divided into three categories namely:

• Preference shares which may be cumulative, non- cumulative, participating, redeemable and/or convertible.

• Deferred shares which may be founders’ shares, vendors’ shares, promoters’ shares and/or management shares.

• Ordinary shares constitute the usual type of share and generally form the largest proportion of a company’s share capital and have the following characteristics:

(a) dependent upon the terms of the ordinary shares, there is usually no date of maturity that is attached to ordinary shares and thus they continue to exist indefinitely unless the company goes into liquidation;
(b) shareholders of ordinary shares may only be entitled to all the remaining profits of the company after the necessary provision for taxation has been made and the allocation to reserves as determined by the directors has been set aside.

An overview of shares:

(c) As an ordinary shareholder, the right exists to purchase more shares should the company decide to issue more shares.
(d) Should the company not make a profit or go into liquidation or be deregistered, the liability of an ordinary shareholder is limited to the amount of capital so invested.
(e) Voting rights attached to ordinary shares are usually in proportion to the number of shares owned.

Ordinary shares while ranking equally so far as participation in profits/losses are concerned, may be divided into separate classes with different voting rights such as low voting shares.

Preference shares usually rank ahead of ordinary shares for dividend purposes, and though bear characteristics of debt securities such as a loan, are not debt securities. Preference shares usually carry no voting rights in a general meeting. But there are exceptions.

This relates to if the preference share dividend (or any part thereof) or any redemption payment remains in arrear or unpaid for at least 6 months or where there is proposed resolution that would directly affect the rights attached to the preference shares. Dividends attached to preference shares are usually fixed percentages, and payment thereof is subject to a solvency and liquidity test being applied.

Redeemable preference shares

Preference shares may either be redeemable, whereby the company would consider buying the shares back at a future date or non- redeemable, whereby there will be no buy-back of these shares by the company.

The terms would be contained in the MoI and redemption could be at the request of the holder thereof. Preference shares are redeemed in accordance with s46 of the Companies Act, and must thus meet a solvency and liquidity test imposed by s4 of the Companies Act.

It is also strongly recommended that the accounting and tax treatment is taken into account before any redemption. Therefore the matter should be discussed with the accounting and tax team(s). It is possible given the nature of the issue of the preference share, the tax treatment for redemption may require a share repurchase process in accordance with s48 instead.

Participating preference shares

Participating preference shares usually mean that they participate in the dividend declared to ordinary shareholders, or they also participate in winding up just like the ordinary shareholders. Again, a solvency and liquidity test needs to be met prior to any distribution.

Example of a preference share resolution

ABC Limited had issued 100 000 redeemable preference shares of no par value each to Nedbank Limited in exchange for funding of R10 million. Three years have passed since this issue and in accordance with the terms of the redeemable preference shares as set out in ABC’s MoI, ABC is required to redeem the shares in full on 31 May 2019.

IT WAS RESOLVED THAT the company redeem on 31 May 2019 100 000 redeemable preference shares of no par value as issued to Nedbank Limited on 1 June 2016 at a redemption distribution value of R10 million and which redemption value would be redeemed out of profits that would otherwise be available for distribution to shareholders.

IT WAS FURTHER RESOLVED THAT immediately following the redemption as referred to in the foregoing resolution, the company will satisfy the solvency and liquidity test as set out in section 4 of the Companies Act where, in consideration of all reasonably foreseeable financial circumstances of the company, (a) the company’s assets, fairly valued, will exceed the company’s liabilities, fairly valued and (b) the company will be able to pay its debts as they become due for a period of twelve months following the aforesaid redemption.

All companies have authorised share capital, which refers to the number of shares decided upon in the company’s MoI. This process of ‘creating’ shares normally occurs at registration of the company and is displayed on the incorporation applied documents of the company.

For private companies, there must be at least one share and one shareholder, and there is no limit to the number of shares a private company may create in its MoI. Authorised shares bear no rights until they have been issued by the company. Issued shares are those issued to the shareholders, which then bear certain rights as specified in the company’s MoI.

The Companies Act has changed the basis on which companies are capitalised. Shares issued in terms of the 2008 Act have no nominal or par value, and as such a pre- existing company may not authorise any new par value shares, authorise any shares having a nominal value, or do any subdivision thereof. Companies that had par value shares as at the effective date (1 May 2011) of the Companies Act may retain such existing shares.

Where more shares are issued than are authorised, the board may retroactively authorise such an issue within 60 business days of issue, but this is not recommended. Failure to obtain authorisation renders the share issue void to the extent that it exceeds the authorised share capital.

In such circumstances, the company must return to the relevant person the fair value of the consideration received in terms of such share issue, with interest, and the directors could be held liable for any loss, damage or costs sustained by the company as a consequence of knowingly issuing unauthorised shares.

Lost share certificates

As per s49 of the Companies Act, securities (which includes shares) issued by a company must be either:

• evidenced by certificates; or

• uncertificated where certificates are not issued but the shares are held in electronic form evidenced through a record administered by CSDP in the prescribed form.

Where the company has certificated shares, a share certificate is evidence of the number of shares the shareholder owns in the company. Share certificates are normally issued through the company secretary and must include the following information:

• the name of the issuing company;
• the name of the person to whom the shares were issued;
• the number and class of shares;
• any restriction on the transfer of the shares evidenced by that certificate.

The share certificate must be signed by two persons authorised by the board of the company, one of whom is normally the company secretary.

Share transfers

The Companies Act states that a share issued by a company is moveable property, transferable in any manner provided for.

“A shareholder who wishes to dispose of his or her shares must first offer the shares to the other shareholders of the company pro rata to their existing shareholdings at a price to be determined in a prescribed way. Transfer in terms of the MOI shall include the cession of shareholders right.”

Share transfer duty tax known as a Securities Transfer Tax (STT) is a tax payable on all transfers of shares at a rate of 0.25% on the transfer of all shares in companies incorporated in South Africa. If Company A sells 100 shares to Company B for R5 million, the STT payable will be as follows:

R5 000 000 x 0.25% = R12 500.

The duties and responsibilities of a company secretary in matters involving shares and the share register, particularly the transfer of shares can be considered to be among the most demanding and complicated within the role of the company secretary. There is a certain amount of statute and case law on the subject together with the complexity of how corporate transactions can at times be structured.

A private company is prohibited from offering its shares to the public and must restrict transferability of its shares in its MoI. An example of a restriction on transferability is making the right of transfer subject to a right of pre-emption.

In today’s digital age, most companies have a software secretarial package that would also include the share register. For those companies who have not yet acquired a software package, the share register would still be manually processed via a “book” commonly referred to as the “red book”. Listed companies, due to the sheer volume and high values involved, are required to appoint a specialist company known as a transfer secretary to manage the share register of the listed company. The two main transfer secretaries in South Africa are Computershare Investor Services and Link Market Services.

Sections 49 to 56 of the Companies Act must be noted as well as the terms and requirements as set out in the company’s MoI. Failure to comply with the regulatory requirements can invalid a share transaction and such mistakes or omission could be costly for the company. Also what is equally important is that the agreement between the parties must be fully understood and the company secretary should have a copy or access to a copy of this agreement. A company secretary that does not take the necessary care around this and blindly takes an instruction to process a share transaction without supporting documents and the relevant board resolution can be accused of negligence and gross misconduct later.

Also important with share transfers is the need to observe exchange control regulations where either of the transferor or transferee is a non- resident. A share certificate issued to a non-resident would need to be endorsed accordingly. This is usually done through an authorised bank.


incl VAT

Free Download - Assignment agreement

Agreement between the parties whereby the assignee becomes the owner of the rights of copyright providing the terms of such agreement.


incl VAT

Free Download - Power of attorney to sell immovable property

Power of Attorney to Sell Immovable Property


incl VAT

Free Download - Mix of forms guidance

Guidance as to which form is required in which instance and the costs related thereto.


incl VAT

Free Download - Certificate as to authority of notary public

Certificate as to authority of notary public


incl VAT

Free Download - Application for a design registration

Form D1 for the registration of a design.


incl VAT


Submit your enquiry.
Attorneys / Lawyers standing by to assist.

Lawyers / Attorneys
LIVE waiting to assist

Law Categories