2. Decision Making Flashcards
Notice Requirements of General Meeting?
14 days clear notice to shareholders, directors and auditors
set out date, time, place, SR matter and right to proxy
Who can call short notice for general meeting?
Majority Shareholder with 90/95% company shares
Shareholder’s request to call GM?
- Shareholder request directors to call GM
- directors call GM within 21 days of request
- hold GM within 28 days of notice
which shareholders can request to hold Board Meeting?
At least 5% paid up capital + directors must call within 21 days
what record should company regularly update?
Register of members
Register of directors
Board minutes
GM minutes
Remove company secretary
- Directors pass BR
- notify Companies House + Registrar within 14 days
- Amend Registrar of Secretaries
Procedure of allotting shares to new shareholders
- restrictions? remove ASC by OR or amend articles by SR
- **Directors authority **
Amend articles by SR if needed
same class
CA 2006: BR
pre 2006: OR to give authority
different class: OR
- **disapply pre-emption rights - SR **
- file SR/OR, SHO1 Form + share certificate within 2 months + enter on register
How can minority shareholder be protected?
Bushell v Faith clause
Non compete clause
restrict share transfer in shareholder agreement
what resolution to appoint or remove director?
Ordinary Resolution
Rights of shareholders with ordinary shares?
Right to:
- dividends
- votes
- attend GM
Unfair Prejudice Claim
- company conducted affairs unfairly or
- act or omission by company was prejudicial and caused harm to shareholder
Remedy of Unfair Prejudice Claim?
Offer to buy their shares
Grounds for derivative claim?
Director breached duty by negligence/omission e.g. misuse company funds
Defence for derivative claim?
Claimant is not acting to promote companies success
Act hasn’t happened yet
Act has been ratified by company
What type of voting in Board Meeting?
Show of hands (1 voter pp) on simiple majority
What if a director has a personal interest in a transaction?
MUST declare personal interest
When can a director who has a personal interest in the transaction still count towards the vote/qurom?
Transaction to buy shares
Exceptions to declaring personal interest?
- already aware
- unlikely to be conflict of interest or
- terms in a service contract
Process to remove director?
- Call GM (by director/shareholders)
- give special notice to director - 28 days
- director can defend themselves in GM
- Pass OR
