In a share ledger, and for each individual shareholding, there should be a possibility to make notes that become part of the historical record to be preserved.
A note can clarify information about an event, such as:
An agreement for transfer was made on a certain date, but the notification to the company about entering it into the share ledger was delayed. In this case, it may be useful to note when the tax-effective transfer occurred.
When share certificates are issued and returned (or cancelled), this should be noted in the share ledger.
If a shareholder loses their share certificate and a process to void the certificate is initiated, it should be noted. Similarly, once the process is completed and a new share certificate is issued to replace the voided one, this should also be recorded.
Another reason for making a note in the share ledger could be to explain a correction transaction if there was an error in the registration process earlier.
If a company has a right of first refusal or restrictions in its articles of association, and transfers occur that trigger these clauses, the subsequent process should be recorded in the share ledger.
Examples of Notes for Right of First Refusal:
If a shareholder notifies that shares subject to a right of first refusal have been transferred to another party, the notification should be recorded and dated in the share ledger. Subsequently, the initiation of the right of first refusal process should be recorded and dated. If other shareholders show interest in fully or partially acquiring the offered shares, this should also be noted and dated.
Additionally, if any of the involved parties or other shareholders are dissatisfied with the management of the right of first refusal process and wish to initiate legal proceedings, this should be noted and dated in the share ledger.
Examples of Notes for Redemption Clauses:
If a shareholder notifies the board that they intend to redeem shares subject to a redemption clause, this should be noted and dated in the share ledger. Similarly, if any of the involved parties or other shareholders are dissatisfied with the management of the redemption process and wish to initiate legal proceedings, this should be noted and dated in the share ledger.
Examples of Notes for Preemption Clauses:
If a shareholder notifies the board that they intend to transfer shares subject to a preemption clause, this should be recorded and dated in the share ledger. Similarly, if any party wishes to acquire shares subject to the preemption clause, this should be noted and dated in the share ledger.
Moreover, if any of the involved parties or other shareholders are dissatisfied with the management of the preemption process and wish to initiate legal proceedings, this should be recorded and dated in the share ledger.
Examples of Notes for Consent Clauses:
If a shareholder notifies the board that they intend to transfer shares subject to a consent clause, this notification should be recorded and dated in the share ledger. The board must act in accordance with how the consent clause is formulated. If a party wishes to acquire shares subject to the consent clause, this should be noted and dated in the share ledger.
If any of the involved parties or other shareholders are dissatisfied with the handling of the consent process and wish to initiate legal proceedings, this should be noted and dated in the share ledger.
Examples of Notes for Conversion Clauses:
If a shareholder notifies the board that they intend to convert shares subject to a conversion clause, this should be noted and dated in the share ledger. Similarly, if any of the involved parties or other shareholders are dissatisfied with the handling of the conversion process and wish to initiate legal proceedings, this should be noted and dated in the share ledger.
Other Notes:
If you are unsure about what should be noted in the share ledger, it is highly recommended to consult legal expertise.