Alteration of Capital Clause
A Company may if authorized by its articles alter its share capital in the following ways:
- Increase share capital: This may be done by an ordinary resolution in a general meeting of the Company. Notice of the increase and a copy of the resolution must be filed with the registrar. Where the articles do not give power to increase the capital then a special resolution must be passed to alter the articles in order to empower the company to increase its capital.
- Consolidation of shares: a company may by ordinary resolution and if authorised by its articles consolidate its capital by amalgamating shares of small amounts to share of large amounts e.g. a consolidation of 100 shares of Sh. 18 each to 50 shares of Sh. 36 each.
- Subdivision of shares: a company may by ordinary resolution subdivide its share into shares of smaller amounts.
- Cancellation of unissued capital: a company can reduce the amount of share capital available for issue but this does not amount to a reduction of capital because shares have not been issued.
- Reduction capital