Joint Decision Making Flashcards
(29 cards)
What is meant by joint decision making?
Directors make day-to-day decisions
Shareholders make other decisions through meetings or written resolutions
What companies are required to hold annual shareholder meetings?
Plc’s
Who can call a shareholder meeting?
Usually directors
Can shareholders require a meeting to be called?
Yes
How can shareholders call a meeting?
If those with 5% of the paid-up voting capital call one
What happens if the shareholders vote to call a meeting?
On receipt the directors have 21 days to organise a meeting before the expiry of 28 days (from 21 days)
What if the directors fail to call a shareholder meeting?
Those shareholders that requested it (or those with over 50%) can call a meeting a be reimbursed for any expense incurred
When can an auditor require a shareholder meeting?
On resignation if they wish to give reasons for their resignation
When can a court call a shareholder meeting?
Where it is impractical for the company to call it - cases of deadlock
Who must notice of a shareholders meeting be given to?
All shareholders and directors
PRs of deceased shareholders
Trustees of any bankrupt shareholders
What must a notice of shareholder meeting include?
Date, time, location, general business, right to appoint a proxy, full text of any special resolution
What is the timing for a shareholder meeting?
14 clear days (longer if articles amended) - if hand delivered
16 days if by any other method
What if insufficient notice is given?
The member can seek to have any action taken at the meeting declared invalid
When can meetings be held at shorter notice?
If agreed by those holding 90% - PLCs or 95% - Ltds
What is the quorum for a shareholders meeting?
2
What happens if there is not a quorum at a shareholder meeting?
No valid vote can be made
What are the two types of shareholder resolution?
Ordinary resolution (simple majority)
Special resolution (at least 75%)
When are special resolutions generally requried?
Where the decision will adversely affect shareholders
How are votes carried out at a shareholder meeting?
By show of hands unless those with more than 10% of voting rights or share capital demand a poll
What company can pass a written resolution?
Private
What is the benefit of a written resolution?
Can pass resolutions without a shareholder meeting (quicker / more cost effective)
(still passed by shareholders though)
Can written resolutions be used for ordinary and special resolutions?
Yes
What can a written resolution not be used for?
To dismiss a director or an auditor
Who usually decides on whether to circulate a written resolution?
The directors
