How can I cancel shares already issued?
We cannot do this for you, but it appears this can be done under S.256C of the Corporations Act 2001. If some people's shares are getting cancelled and not others, this may be more problematic (although it may simply require a special resolution). Refer also to S.256B.
We only provide these details to give you a head start, and it may be worthwhile calling ASIC. There may also be both CGT and stamp duty issues to consider.