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Issuing a company's first shares

How you organise your The total nominal value of a company's shares. References to a company’s share capital can be read as references to all of that company’s shares. determines who ultimately controls your A private company limited by shares incorporated and registered in England and Wales. . When you set up your A private company limited by shares incorporated and registered in England and Wales. you are free to decide how many In relation to a company limited by shares, means persons whose names have been entered in the register of members of that company as shareholders in that company. there will be, how many Shares in the capital of a company (sometimes also referred to as stock, for example in relation to US companies). Shares in a company give to the holders, known as shareholders, rights in relation to that company such as to vote, to receive dividends and to a return of capital. Holders of shares in a company own that company and the company, not its shareholders, owns the company's assets. each of the In relation to a company limited by shares, means persons whose names have been entered in the register of members of that company as shareholders in that company. have, and the price of those Shares in the capital of a company (sometimes also referred to as stock, for example in relation to US companies). Shares in a company give to the holders, known as shareholders, rights in relation to that company such as to vote, to receive dividends and to a return of capital. Holders of shares in a company own that company and the company, not its shareholders, owns the company's assets. . You can also choose to have different classes of A share in the capital of a company (sometimes also referred to as stock, for example in relation to US companies). Shares in a company give to the holders, known as shareholders, rights in relation to that company such as to vote, to receive dividends and to a return of capital. Holders of shares in a company own that company and the company, not its shareholders, owns the company's assets. , giving some In relation to a company limited by shares, means persons whose names have been entered in the register of members of that company as shareholders in that company. different rights. Find out how to decide on the number and price of your A private company limited by shares incorporated and registered in England and Wales. 's first Shares in the capital of a company (sometimes also referred to as stock, for example in relation to US companies). Shares in a company give to the holders, known as shareholders, rights in relation to that company such as to vote, to receive dividends and to a return of capital. Holders of shares in a company own that company and the company, not its shareholders, owns the company's assets. and how to create and assign them to people when you The legal process of forming a company or corporate entity..

starting-a-company

Before issuing the first shares

  1. 1.How do I organise my company's share capital at incorporation?

How many shares to issue for a new company

  1. 2.How many shares should my company start with?
  2. 3.How many shares should I start with per person?
  3. 4.What difference does it make how many shares each person has?
  4. 5.How do I avoid deadlock in a 50/50 owned company?

The nominal value of shares in a new company

  1. 6.What is the nominal value of shares?
  2. 7.How do I decide the nominal value of shares at incorporation?
  3. 8.When might I want to issue shares at a premium over their nominal value?

Rights of the first shareholders

  1. 9.What rights will my first shareholders have if I use the model articles?
  2. 10.What voting rights will my first shareholders have under the model articles?
  3. 11.What rights will my first shareholders have under the model articles to receive dividends?
  4. 12.What rights to new shares will my first shareholders have under the model articles?
  5. 13.What rights will my first shareholders have to bring legal action if you use the model articles?
  6. 14.What rights to information will my first shareholders have under the model articles?
  7. 15.What rights to capital will my first shareholders have under the model articles?
  8. 16.If I do not use the model articles, what legal rights will my company's shareholders have?

How to issue shares on incorporation

  1. 17.How do I issue shares in my company on incorporation?
  2. 18.What do I need to do to issue more shares after incorporation?
  3. 19.Should I issue more than one class of shares at incorporation?
  4. 20.What are the different classes of shares?
  5. 21.Should I insist my company's first shares are paid for in full?
  6. 22.Can my shareholders pay for their shares in cash or kind?
  7. 23.Should I allow shareholders to pay for their shares in kind?
  8. 24.How and when should my company's first shareholders pay for their shares?

Shareholders' responsibilities and liabilities

  1. 25.Are my shareholders free to do what they want?
  2. 26.What happens if my shareholders act unfairly?
  3. 27.Do my shareholders have to contribute to my company's debts?

Company registers

These are template registers, for use by a company. This set of company registers includes a register of members, register of directors, register of secretaries, register of directors’ residential addresses, and a PSC register. Keeping proper company registers is important. You must have an up to date set. Failure to do so is an offence committed by both your company and any officers at fault. The template includes three versions of each register your company is legally required to keep. The first version has guidance notes to explain how to fill in your register; the second is an example to demonstrate how the completed register should look; and the third is a blank template for you to fill in for your company (and duplicate as required, depending on how many shareholders/directors/PSCs you have). In your final version registers, you should ensure you delete or replace the guidance notes and examples. You can also get this document as part of the Starting a company toolkit .
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Quick guide to shareholder rights and shareholding percentages

This quick guide to shareholder rights and shareholding percentages sets out the legal rights of shareholders (such as how much control they have over the company) depending on the percentage of shares that they own. You can use this quick guide to help you decide how many shares to issue to different shareholders when you start your company, and/or whether to issue or transfer shares in future. It will help to make sure you are aware of which rights you are giving shareholders and how much control they will have over your company. If you have a shareholders' agreement, you'll need to make sure you follow its terms too (eg you might give a shareholder additional rights to veto certain decisions or give certain shareholders different classes of share). Note that this quick guide assumes that your company is using the model articles and has one class of share. You can also get this document as part of the Starting a company toolkit .
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