Transmission of Shares

Transmission of Shares

This occurs when the ownership rights associated with shares are transferred to another party by operation of law, not through a voluntary transfer. It commonly happens under the following circumstances:

1. Death of a Shareholder:

In the event of a shareholder's death, the shares owned by the deceased individual automatically transfer, with respect to their associated rights, to the executor or administrator. The appointed representative has the authority to sell or dispose of the shares, such as transferring them to the designated beneficiary, without the need for formal registration. However, any restrictions on transfer outlined in the articles remain applicable.

2. Bankruptcy:

In cases of a member's bankruptcy, the right to manage and deal with the shares shifts to the trustee in bankruptcy. The trustee can choose to sell the shares without completing the registration process, or alternatively, they may opt to undergo registration, contingent upon any restrictions stipulated in the articles.