Directors’ Resolution to Issue Shares Template

A Directors’ Resolution to Issue Shares is a resolution to be passed by the directors of a company to approve the allotment and issue of new shares.

Important note: There are statutory restrictions on the circumstances under which the board of directors can authorise allotment and issue of shares, e.g. when the shareholders have already approved the issue, or when the issue is proportional to the existing shareholding of the company. In other circumstances, e.g. if the company has a new incoming shareholder, changing the shareholding proportion of the existing shareholders, allotment and issue of shares must be approved by shareholders. Contact the Customer Success Team of Zegal if you have any questions.

After using this  Things to remember after using this Directors’ Resolution to Issue Shares:

• file the relevant form to update the relevant government department or registry within the statutory time limit;
• issue and deliver new Share Certificates; and
• update the register of members of the company.

There are two options when using a Directors’ Resolution to Issue Shares:

• if a meeting of the board of directors is convened to issue shares, use a Board Minutes to Issue Shares; or
• if the board resolution will be passed by way of a written resolution, use a Board Resolution to Issue Shares.

Is board resolution required for transmission of shares?

In the demise of the shareholder, their ownership of shares is legally transmitted to the heirs. This is called the transmission of shares. The surviving heir must make a request to the company following the death of a shareholder. They must have a specific list of documents that are required for this ready. If the application is well completed and the company is convinced with the application, it will be approved. However, if the documents are incomplete or the application, is not duly filled, they can reject the request.  For refusals, it is the company’s responsibility to inform and communicate this within 30 days from the submission of the request form.

Board resolution is required for the transmission of shares to authorize the approval from the board of directors to carry on things as required to give effect to the procedure for transmission of shares.

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