Creating More Company Shares

Ask Your Question For Free

Summary

As a supermajority shareholder, CEO, and Chairman, you can propose creating more shares, but it requires board and shareholder approval. Issuing performance shares can increase your equity but will dilute existing shares. Achieving milestones can enhance company value, potentially increasing your wealth despite dilution. Consult your companys articles of association and legal requirements for detailed procedures.

Full Conversation

if i am the supermajority shareholder in a company and ceo and chairman and all that can i create more shares of the company and give them to myself
Hi Oskar,
In Switzerland, the process to create more shares and allocate them involves several steps that must comply with corporate governance rules:
- **Approval by Shareholders**: Even as a supermajority shareholder, creating new shares typically requires approval from the general meeting of shareholders.
- **Amendment of Articles of Association**: The company's articles of association may need to be amended to reflect the increase in share capital.
- **Legal Requirements**: Swiss law (Code of Obligations) mandates compliance with specific procedures and filings with the commercial register.
Do you know if your company's articles of association allow the creation of new shares?
how would you sudgest me gaining more equity in my company without buying out of my own money
You might consider the following options to gain more equity in your company without using your own money:
- **Stock Options or Warrants**: Propose to the board to issue stock options or warrants to yourself, which can be exercised in the future.
- **Performance Shares**: Receive additional shares as a reward for hitting certain performance milestones.
- **Convertible Debt**: Arrange for the company to issue convertible debt that can be converted into equity under certain conditions.
Do you know if your company's board is open to these types of proposals?
and would these preformance shares dilute the other shares or what
Yes, issuing performance shares would typically dilute the other shares, as it increases the total number of shares outstanding, thereby reducing the ownership percentage of existing shareholders.
Would you like more information on how to implement performance shares in your company?
yes and whose approval would i need if i own *% of the company and only * other person *% and i am the ceo and chairman of the board and he is also on the board and one other person is also on the board how would it work and gimmie an example paragrph for a contract
Hi Oskar,
To issue performance shares, you would generally need:
- **Board Approval**: As CEO and Chairman, you can propose this to the board for approval.
- **Shareholder Approval**: A supermajority (often */*) may be required, depending on your company's articles of association.
Here's a sample paragraph for a contract:
---
**Issuance of Performance Shares**
The Company agrees to issue [Number] performance shares to [Name], contingent upon the achievement of the following milestones: [Specify Milestones]. These shares will be issued on [Date] and will dilute the existing shareholders' equity proportionately. This issuance has been approved by the Board of Directors and the requisite shareholder majority.
---
Would you like more details on the approval process?
so my company is in the vanilla industry and we focuss on expantion and are profit margins are *% profit of our revenue what would a mile stone be and give examples with real shares and my current equity and my future equity
To set a milestone that aligns with your company’s focus on expansion and high profit margins, consider the following example:
**Milestone Example:**
- **Milestone**: Increase annual revenue by *% within the next fiscal year.
- **Current Equity**: *% (your ownership)
- **Performance Shares Issued**: *% of total shares for achieving the milestone.
- **Future Equity**: After achieving the milestone and issuing performance shares, your equity would be *% (assuming no other shares are issued).
Would you like more details on how to draft an agreement for these performance shares?
yes
Hi Oskar,
Here's a more detailed example of how to draft an agreement for performance shares:
---
**Performance Share Agreement**
***. Issuance of Performance Shares:**
The Company agrees to issue [*%] performance shares to [Oskar], contingent upon the achievement of the following milestone:
- **Milestone:** Increase the company's annual revenue by *% within the next fiscal year.
***. Conditions:**
- These shares will be issued on [specific date], upon confirmation that the milestone has been met.
- The issuance of these performance shares will dilute the existing shareholders' equity proportionately.
***. Approval:**
- This issuance has been approved by the Board of Directors.
- The requisite shareholder majority approval (*/*) has been obtained.
***. Future Equity:**
- Current Equity: *%
- Future Equity: *% (if the milestone is achieved and performance shares are issued)
---
Would you like further details on any specific clause or additional assistance with the approval process?
and would that make me richer or the others poorer or would that just make each share proportionaly less valuabl
Issuing performance shares will dilute the ownership percentage of existing shareholders, making each share proportionally less valuable. However, if the milestone is achieved and the company's value increases, the overall value of your holdings may increase, potentially making you richer despite the dilution.
Would you like more information on how to balance dilution and value creation?