14. Meetings of shareholders and members

Question 1

<p>Can any member request that a resolution be circulated?</p>

Answer 1

<p>No, the member or members must hold between them not less than 10% of the voting rights at the general meeting</p>

Question 2

<p>What is duomatic principle?</p>

Answer 2

<p>If 100% of the shareholders come together to approve something unanimously, then it becomes binding and passes like it was agreed at a shareholder meeting. This is how public companies can pass a written resolution.</p>

Question 3

<p>Member meeting or written resolution</p>

Answer 3

<p>Private companies can pass any resolution by written resolution except to:
<br></br>Remove an auditor
<br></br>Remove a director</p>

Question 4

<p>On what basis can members of a public company approve a resolution other than at a general meeting?</p>

Answer 4

<p><strong>By proxy</strong> or <strong>unanimous written resolution</strong> under the duomatic principle</p>

Question 5

<p>Role of cosec during the AGM</p>

Answer 5

<p>During the meeting
<br></br>1. Ensure a quorum is present and confirm this to the chair to open the meeting.
<br></br>2. The company secretary should be prepared to read the notice if this is not taken as read.
<br></br>3. All directors should attend and they should sit on the platform or in the front rows – they should wear name badges.
<br></br>4. Attendance by other professionals – auditors, scrutineers, registrar, press (if allowed), external auditors, company lawyers etc. is at the discretion of the meeting and they should not be permitted to vote, unless they are also a member.
<br></br>5. There is no requirement to read the auditor’s report.
<br></br>6. For quoted companies, the chair will normally read a statement reviewing the year’s affairs as well as a trading update. Text released to the Stock Exchange in advance of the statement being read to comply with disclosure requirements.
<br></br>7. The chair should allow time for members to ask questions even where a specific Q&A session prior to the formal resolutions. Members should state their name before asking their question.
<br></br>8. The chair should explain the method of voting for resolutions.
<br></br>For larger companies often on a poll.
<br></br>For smaller companies and especially private companies voting on a show of hands is the norm with poll votes being the exception.
<br></br>9. Ensure that sufficient supplies of ballot papers are available if required.
<br></br>10. Amending a resolution:
<br></br>‹. An OR can be amended if the amendment is reasonably within the scope of the original. The revised amendment wording must be approved by the meeting before it is then voted on.
<br></br>‹. An amendment cannot be allowed if it is a direct contradiction of the original resolution.
<br></br>‹. A special resolution cannot be amended at the meeting.
<br></br>11. Polls can be demanded at the meeting in accordance with the Articles. Typically if demanded by at least three members present and entitled to vote, members representing at least 10% of the voting rights or members having at least 10% of the shares with voting rights. CoSec often oversee the process, in conjunction with the share registrars, if any.</p>

Question 6

<p>What is the role of cosec after the meeting?</p>

Answer 6

<p>After the meeting
<br></br>1. CoSec collect all books and papers left by directors.
<br></br>2. Arrange for copies of approved resolutions that require registration, to be filed on time with CH.
<br></br>3. Listed companies must make a market announcement via an RIS of all resolutions, other than ordinary resolutions at an AGM, approved by the shareholders at a GM (LR 9.6.18).
<br></br>4. Organise the payment of the dividend, if approved, at the meeting.
<br></br>
<br></br>All proxies are entitled to speak at the meeting including demanding or joining in the demand for a poll vote on any resolution (CA2006 ss. 324 and 329).
<br></br>It is not usually necessary for these to be sent out in draft to all the directors for comments, since the minutes will usually cover only routine business or such other business as may have been specified in the notice convening the meeting.</p>

Question 7

<p>What is the role of cosec after the meeting?</p>

Answer 7

<p>After the meeting
<br></br>1. CoSec collect all books and papers left by directors.
<br></br>2. Arrange for copies of approved resolutions that require registration, to be filed on time with CH.
<br></br>3. Listed companies must make a market announcement via an RIS of all resolutions, other than ordinary resolutions at an AGM, approved by the shareholders at a GM (LR 9.6.18).
<br></br>4. Organise the payment of the dividend, if approved, at the meeting.
<br></br>
<br></br>All proxies are entitled to speak at the meeting including demanding or joining in the demand for a poll vote on any resolution (CA2006 ss. 324 and 329).
<br></br>It is not usually necessary for these to be sent out in draft to all the directors for comments, since the minutes will usually cover only routine business or such other business as may have been specified in the notice convening the meeting.</p>

Question 8

<p>How are written resolutions proposed?</p>

Answer 8

<p>Directors may propose resolutions under the Act, s291.
<br></br>Copies of proposed resolutions must be sent to all eligible members at the same time, in hard copy or electronically or by using a website. Eligible member is a member entitled to attend and vote. The same copy can be circulated for signature, but to be valid, all signatures must be obtained within 28 days. The resolution must be accompanied by statement on how to signify consent and the deadline to receive consent.
<br></br>Cannot be revoked once agreed.
<br></br>
<br></br>WR approved when the requisite majority have signified consent, votes calculated according to the number of shares.
<br></br>
<br></br>If agreement has not been given within 28 days, it is deemed to have lapsed.
<br></br>
<br></br>Copies must also be sent to the auditor</p>

Question 9

<p>Within how many days must a proposed resolution be circulated to members?</p>

Answer 9

<p>21 days</p>

Question 10

What 3 types of members’ meetings are there?

Answer 10

General meeting
Annual general meeting
class meetings of a particular class of co’s capital

Question 11

Who can requisition a written resolution or general meeting

Answer 11

Members holding 5% of the voting rights can requisition the GM, but not AGM
Court can have power to order GM to be held, including AGM

Question 12

Business of the GM

Answer 12

The following can be routine business:

• Receiving the report and accounts
• Declaration of final dividend
• The re/election of the d
• Auditor & rem
• Receipt of Rem report (quoted companies)
• Approval of Rem policy (quoted co)

Apart from routine, other resolutions may be put to members

• Special resolution to alter the Articles
• Authorisation of additional shares
• Disapplication of pre-emption rights
• Authorisation to give political donations
• Authority to convene GM on 14 days notice

Question 13

Under what circumstances must a private company hold an AGM?

Answer 13

If it is a quoted company or required by Articles

Question 14

When should the AGM be held?

Answer 14

No later than 6 months after the fin year end for plc

9 months for private companies

Question 15

What should be included in the Notice?

Answer 15

State that is AGM
Date, time, location
Statement that members are entitled to appoint a proxy
Distinguish between ordinary and special resolution
Comply with requirement of LR13
Be dated and signed

Question 16

When should the notice be sent?

Answer 16

21 clear days before the meeting in advance of the meeting.
Clear days - not including the day of posting and the day of the meeting.
20 business day for a listed co

If Notice proposes to remove a director or auditor or appoint a new auditor - 28 days in advance of the meeting

Question 17

When should the proxies be returned?

Answer 17

48 hours before the meeting commences

Question 18

Who can demand polls at the AGM?

Answer 18

At least 3 members present and entitled to vote
members representing at least 10% of the voting rights
or members having at least 10% of the shares between them

Question 19

Which documents should be available for inspection by members at the AGM?

Answer 19

Register of members
Directors’ service contracts
Notice

Question 20

Are amendments to resolution allowed?

Answer 20

No amendments for special resolutions

Only typos for ordinary resolutions

Question 21

What is Special Notice?

Answer 21

A special notice must be given to the company as follows:
A resolution to remove an auditor
A resolution to remove a director
To appointment a new director in his place

If giving Notice is not practicable, advertisement in the newspaper must be given, or other means stipulated by the Articles not less than 14 days before the meeting

Question 22

What must a traded company have done to allow members’ meeting to be held on 14 days notice?

Answer 22

Obtained consent at the previous AGM or general meeting held since the previous AGM

Question 23

What Resolutions are dealt by Special resolutions?

Answer 23

Examples:
Alteration of Articles
Change of name
disapplication of pre-emption rights
reduction of capital