Shares are equal portions in which the capital stock of a corporation is divided and the ownership is supported by a stock certificate. Authorized shares are shares of the company available to be issued to shareholders, whereas the Issued Shares are already issued to shareholders and the records of the shares are kept at the companies’ registered office.
You may have heard terms such as par value and no par value of shares – the difference thereof is that par value is a standard nominal value, for an example R2, of which a share will be an issue, and no par just simply means there isn’t any standard nominal value attached to the shares. The Current Company Act provision for companies to be registered with no par value, however every company that had already registered with par values prior the amendment of the company act on 1 May of 2011 may keep their par value until a resolution is been passed to convert it to a no par value.
Par values cannot be increased, but a company can be converted into a par value provided that a resolution is passed by support of at least 75% of the voting rights, same with any amendments of the MOI, it has been done through a resolution passed by the shareholders of the company and changes of the shares can be approved by a board of directors.
[ht_message mstyle=”success” title=”” show_icon=”” id=”” class=”” style=”” ]Please note that Issued shares are no longer registered through CIPC, online through the website you can convert company shares from par value to no par value. You can increase the existing shares with no par value. You can reclassify existing shares with par value and with no par value.[/ht_message]
Companies’ shares can be changed, however, nonprofit companies and close corporations do not have shares and shareholders and thus there aren’t any shares to be amended.
[ht_message mstyle=”info” title=”” show_icon=”” id=”” class=”” style=”” ]It is imperative that you browse through Business Ideas, for a better understanding of business.[/ht_message]