Share Certificate

A Share Certificate is a written document which serves as a legal proof of a shareholder's ownership of shares in a company. The share certificate is often issued by companies to shareholders after an allotment has been made or after a transfer or transmission of shares.

This document includes the name of the company and registration number of the company whose shares is being issued, the certificate number, the particulars of the holder(s) of the shares, the class(es) of shares being issued, date of issue, the amount paid on each share etc.

This document can only be used by the following type of companies:

• Private Company Limited by Shares. This is the most common type of company. The liability of the members is limited by the shares the shareholders hold in the company which remains unpaid. This means is that in the event of winding up, the members are only liable to pay such amount of unpaid shares (if any). This type of company does not offer its shares to the members of the public. The name of the company must end with "Limited".

• Public Company Limited by Shares. This is similar to the private company limited by shares but it can invite the members of the public to subscribe to its shares (that may be listed on the Nigerian Stock Exchange). There is no limit to the membership of the company. The name of the company must end with "PLC".

• Unlimited Liability Companies. An unlimited liability company is a company that has no restriction on the responsibility of the members of the company. Consequently, members of an unlimited liability company will be held responsible for all the debts of the company until the debts are fully paid and there is no extent of liability. The name of the company must end with "Unlimited".

Note that this document can not be used by a company limited by guarantee as this type of company does not have shares.

How to use this document

This document is used in the following circumstances:

• when a company issues new shares;
• when shares have been transferred to another by way of sale or gift;
• when the shares of a dead shareholder have been transmitted to a beneficiary; or
• if a share certificate, which has been previously issued, is lost or defaced.

The law provides that share certificate must be issued within 2 months after new shares have been allotted or within 3 months after shares have been transferred to another. After filling this form, the document should be printed on a thick paper (the papers usually used for printing certificates).

According to the law, a share certificate may be issued either under the company's common seal or signed by a deed. This means that the old requirement of issuing share certificates under a company's common seal only has been modified. The certificate should be signed by one director and one secretary of the company. The company should issue the share certificate to the named holder of the shares and keep a copy for record purposes.

Note that after the certificate has been issued, the company is required to enter the names of new shareholders in the company's register of members.

Applicable law

The Companies and Allied Matters Act, 2020 applies to this document.

How to modify the template

You fill out a form. The document is created before your eyes as you respond to the questions.

At the end, you receive it in Word and PDF formats. You can modify it and reuse it.