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  • RCCP Title IV Part 3

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    James Dencer
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    The document discusses ways for a corporation to increase or decrease its capital stock. It can increase capital stock to raise more assets by issuing new shares at a fixed value or increasing the par value of existing shares. It can also increase capital stock without raising more assets through stock dividends. Capital stock can be increased or decreased by changing the number of authorized shares, the par value per share, or both the number and par value. Increasing or decreasing capital stock requires a majority vote of the board of directors.

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    RCCP-Title-IV-Part-3

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    The document discusses ways for a corporation to increase or decrease its capital stock. It can increase capital stock to raise more assets by issuing new shares at a fixed value or increasing the par value of existing shares. It can also increase capital stock without raising more assets through stock dividends. Capital stock can be increased or decreased by changing the number of authorized shares, the par value per share, or both the number and par value. Increasing or decreasing capital stock requires a majority vote of the board of directors.

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    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
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    6 views1 page

    RCCP Title IV Part 3

    Uploaded by

    James Dencer
    The document discusses ways for a corporation to increase or decrease its capital stock. It can increase capital stock to raise more assets by issuing new shares at a fixed value or increasing the par value of existing shares. It can also increase capital stock without raising more assets through stock dividends. Capital stock can be increased or decreased by changing the number of authorized shares, the par value per share, or both the number and par value. Increasing or decreasing capital stock requires a majority vote of the board of directors.

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    © All Rights Reserved
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    of 1

    POWER TO INCREASE OR DECREASE CAPITAL STOCK

    NECESSITY FOR INCREASING CAPITAL STOCK

    A. INCREASE OF CORPORATE ASSETS

    - An increase of the amount of the stated capital may be for the purpose of effecting an increase
    in the corporate assets. It may be effected by:

    1. Authorizing the creation of new shares to be offered and issued at a fixed valuation; or
    2. The increase of the par value shares authorized to be issued.

    B. ISSUANCE OF STOCK DIVIDENDS

    - The capital stock may also be increased without any corresponding increase in the corporate
    assets by the issuance of stock dividends.

    WAYS OF INCREASING or DECREASING AUTHORIZED CAPITAL STOCK

    A. By increasing or decreasing the number of shares authorized to be issued without increasing or


    decreasing the par value thereof.
    B. By increasing or decreasing the par value of each share without increasing or decreasing the
    number thereof.
    C. By increasing or decreasing both the number of shares authorized to be issued and the par value
    thereof.

    REQUISITES TO INCREASE OR DECREASE CAPITAL STOCK

    A. Majority vote of the board of directors.

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