Capital increase and share expansion of a limited liability company refers to the process that a limited liability company increases its share capital by issuing new shares on the basis of its original registered capital, so as to acquire new shareholders, expand its scale and improve its strength. The specific process of capital increase and share expansion is as follows: 1. Formulation of capital increase and share expansion plan: The company needs to formulate a detailed capital increase and share expansion plan, specifying the amount of capital increase, the proportion of shares and the mode of capital contribution, which will be reviewed and approved by the board of directors or the shareholders' meeting. 2. Send a letter to the existing shareholders: The company needs to send a letter to the existing shareholders to inform them of the content, time, method and relevant requirements of the capital increase and share expansion plan, and guide them to determine whether to participate in the capital increase and share expansion. 3. Adjustment of capital contribution ratio: The company shall adjust the capital contribution ratio and the company's equity structure according to the shareholders' willingness to contribute to ensure that it will not cause substantial damage to the existing shareholders' rights and interests. 4. Decision-making and deliberation: the management provides detailed information and plans for capital increase and share expansion, and the board of directors or shareholders' meeting of the company conducts deliberation, discussion and decision-making. 5. Filing and announcement: The company needs to file a record in the industrial and commercial department, complete the tax payment and transfer procedures, and make an announcement at the same time and announce relevant information to shareholders and the society. 6. Completion of industrial and commercial change registration procedures: After the company completes capital increase and share expansion, it needs to go through industrial and commercial change registration procedures, including equity transfer, equity registration, certification and other procedures. What needs special attention is that in the process of increasing capital and shares, the company should follow laws and regulations to ensure the healthy development of the company, and at the same time, it should fully consider the rights and interests of existing shareholders to avoid harming their interests.
What is capital increase? What is share expansion? Capital increase refers to increasing the company's share capital by issuing new shares on the basis of the company's original registered capital, so as to achieve the purpose of capital appreciation; Share expansion refers to increasing the total number of shares by issuing new shares under the condition that the existing shareholding ratio of all shareholders remains unchanged, realizing the diversification of the company's shares and expanding the investor base.
A limited liability company can increase its share capital and expand its scale by issuing new shares, but it must abide by relevant laws and regulations to ensure that the procedures are legal, transparent and open. A perfect capital increase and share expansion process can expand financing channels for the company and improve its development ability and competitiveness.
Legal basis:
Article 28 of the Company Law of People's Republic of China (PRC), a limited liability company shall subscribe for its registered capital in the form of shares. The type, quantity and amount of shares shall be specified in the articles of association. The provisions of the Articles of Association on the above matters shall not conflict with laws, administrative regulations and the provisions of the State Council on registered capital.