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Special Resolution Sub-Division of Share Capital Sec. 61(1)(d)

special resolution for subdivision of sharesIn accordance with the provisions of section 61(1)(d) of the Companies Act, 2013, a limited company having a share capital may, if so authorised by its articles, alter its memorandum in its general meeting to sub-divide its shares, or any of them, into shares of smaller amount than is fixed by the memorandum, so, however, that in the sub-division the proportion between the amount paid and the amount, if any, unpaid on each reduced share shall be the same as it was in the case of the share from which the reduced share is derived.

Format of special resolution for subdivision of shares is given hereunder for your reference—

SAMPLE

#. Sub-Division of the Share Capital into Smaller Amount

To consider and if thought fit, to pass, with or without modification(s), the following resolution as a Special Resolution:

“RESOLVED THAT pursuant to the provisions of sections 13, 14, 61, 64 and all other applicable provisions, if any, of the Companies Act, 2013 and the rules framed thereunder including the statutory modification(s) thereto or re-enactment(s) thereof for the time being in force and the relevant provisions of the Articles of Association of the company and Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 issued by the Securities Exchange Board of India (SEBI) and the other Rules, Regulations, Circular, Notifications, etc. issued thereunder, the consent of the members of the company be and is hereby accorded for sub-division of the nominal value of equity shares of the company from the existing nominal value of Rs. 10 each to nominal value of Re. 1/- each, thereby keeping the paid share capital intact and consequently, the existing Clause V of the Memorandum of Association of the company be and hereby deleted and substituted by the following new Clause V:

 "The authorized share capital of the company is Rs. 400,000 (Rupees Four Lakh only) divided into 400,000 (Rupees Four Lakh only) Equity Shares of Re. 1 (Rupee One only) each."

FURTHER RESOLVED THAT pursuant to Sub-Division of the equity shares of the company, nominal value of Rs. 10 (Rupees Ten only) of all the issued, subscribed and paid-up equity shares of the company existing on the Record Date to be fixed by the company shall stand sub-divided into equity shares of nominal value of Re. 1 (Rupee one only) each fully paid.


FURTHER RESOLVED THAT pursuant to the provisions of Section 14 and all other applicable provisions, if any of the companies Act, 2013 and the rules framed thereunder, consent of the members of the company be and is hereby accorded to delete and substitute ‘Clause ...’ of Article ... of Articles of Association of the Company with the following new Clause:-

 "Equity Shares" means the issued and fully paid up equity shares of the company, having a face value of Re. 1 (Rupee one) each.

FURTHER RESOLVED THAT upon Sub-Division of equity shares, as aforesaid, the existing share certificate(s) in relation to the existing equity shares of the nominal value of Rs. 10/- (Rupees Ten only) each held in physical form shall be deemed to have been automatically cancelled and be of no effect on and from the 'Record Date' to be fixed by the company and company may without requiring the surrender of existing share certificate(s) directly issue and dispatch the new share certificate(s) of the company, in lieu thereof, subject to the provisions of the Companies (Share Capital and Debentures) Rules, 2014 and in the case of members who hold the equity shares / opt to receive the sub-divided equity shares in dematerialized form, the subdivided equity shares of nominal value of Re. 1/- (Rupee one only) each shall be credited to the respective beneficiary account of the members with their respective depository participants and the company shall undertake such Corporate Action(s) as may be necessary in relation to the existing equity shares of the company.

FURTHER RESOLVED THAT the Board of Directors of the company be and is hereby authorized on behalf of the company to do all such acts, deeds and things as may be required or considered necessary or incidental thereto.”



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NOTE: The resolution sample(s) here is only for reference, to help you with drafting. Do refer the exact provisions of the Act, relevant rules framed thereunder and any other applicable laws to be able to not to miss out anything important while drafting.

Comments

  1. Jayant Shah7/30/2019

    Thanks a ton. I was searching a lot to find this resolution format for reference.

    ReplyDelete

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