Procedure Plans and Model Articles Flashcards
(23 cards)
What is the main acronym to memorise for procedural steps required by a company to achieve particular aims?
NQAV
- Notice: Who can call meeting and what are notice requirements.
- Quorum: How many people need to be present for meeting to be valid?
- Agenda: What matters to be discussed/voted on?
- Voting: Who can vote?how can voting take place? How are votes counted?
In an MCQ, how will you know whether MAs apply or bespoke articles?
The question will tell you
Using NQAV, provide a general procedure plan for first Board Meetings?
- Notice: Any director can call a board meeting on “reasonable notice”.
- Quorum: Quorum is 2.
- Agenda: board resolutions proposed on certain topics e.g. day-to-day management decisions
- Voting: unanimous or by simple majority on a show of hands.
Using NQAV, provide a general procedure plan for first Board Meetings
- Notice: 14 clear days notice for meeting
* remember written resolutions also possible so meeting not necessary.
* short notice procedure reduces standard period to time it takes to gather consents. 90% of members must agree for short notice to apply. - Quorum: One qualifying person (member, authorised rep or proxy of either)) for a single member company. Otherwise, quorum is 2 qualifying persons unless stated otherwise in AAs.
- Agenda: Any matter that requires shareholder approval.
- Voting: Unless AAs specify, voting is on poll of hands, or poll vote is needed.
Give 5 rules that apply to the written resolution procedure?
- Written resolution should be circulated to all eligible members asap.
- Abstentions count as votes against resolution.
- Votes in favour can’t be revoked.
- Resolution lapses if necessary threshold not met by specified deadline.
- Voting via poll.
What kind of matters require shareholder approval?
(SR)
- Change company name
- Change AAs
(OR)
- Remove director
- Security/guarantee/loan or SPT with director or connected person
- Directors’ long term service contracts.
- Approval of contract for company to buy own shares.
Using NQAV, provide a general procedure plan for Second Board Meetings.
- Notice: same as for first board meetings
- Quorum: same as for first board meeting.
- Agenda:
- chairperson reports what resolutions were passed at GM
- any necessary action is taken e.g. entering a transaction that has just been approved by shareholders.
- secretary instructed (or director if no secretary) to file docs set out under post meeting matters. - Voting: same as for first board meeting.
Name the different forms that may need to be filled out post-meeting?
- AP01: for appointing directors (within 14 days)
- AP03 and AP04: for appointing secretaries and corporate secretaries (Within 14 days)
- TM01: Termination of appointment of directors (within 14 days)
- TM02: termination of appointment of secretary (within 14 days)
- AD01: Change of address of registered office.
- AD02: Nominating a SAIL
- AD03: Change of SAIL
- AA01: Change of ARD
- NM01: Change of name (within 15 days)
- Copy of any SR (within 15 days)
- Register the transfer of shares received on a Stock Transfer Form (STF).
What must you remember to do when making a filing with CH?
The company must pay the fee and the person giving the notice of filing must pass identity checks
After the EECTA comes into force, will companies still be required to keep local registers of directors, company secretaries, or PSC’s?
No
What must the company remember to do when making a filing?
The company must pay the fee and the person making the filing must pass ID checks
After the EECTA comes into force, will companies still need to keep local registers of directors, company secretaries and PSC’s?
No
How will ID checks be carried out under the EECTA?
By way of one-off verification through Companies Register requiring a face scan and link to a primary ID document, or by a registered Assistant Corporate Service Provider (ACSP)
What kind of internal records must be kept and updated? (For now, whilst the EECTA is still not in place)
- Register of directors, secretaries, members, and PSC register
- minutes of BM/GM in minute books and kept for min. 10 years
- copy of meetings + resolutions, even if sole member company.
Provide a suggested procedure plan for altering the AA’s
- Hold 1st BM and agree to call GM.
- Call GM on 14 days’ notice for SR (provide written resolution if available)
- Hold 2nd BM.
- File amended AA’s at CH with SR within 15 days.
- Draw up minutes of meeting
Provide a suggested procedure plan for removing a director?
- Hold BM and agree to call a GM.
- Call GM on 28 days’ notice for OR
- written resolution not available. - - Director may speak at GM. - Hold 2nd BM and vote to terminate any contract held by director.
- Notify CH of removal of director within 14 days.
- update local register of directors.
- Draw up minutes of meeting.
- retain any contract held by director.
Provide a suggested procedure plan for approving a directors 2+ year service contract.
- Hold BM and agree to call GM
- Call GM on 14 days’ notice for OR
- written resolution available.
- send memo with contract details out 15 days before meeting.
- interested director cannot vote. - Hold 2nd BM
- vote to offer contract
- interested director need not make a declaration of interest. - Advise registrar of where the service contract can be inspected.
- draw up minutes.
- retain contract.
Provide a suggested procedure plan for approval of an SPT, loan, quasiloan or credit transaction to a director.
- Hold BM and agree to call GM.
- Call GM on 14 days notice for OR.
- written resolution available.
- send memo with contract details out 15 days before meeting.
- interested director cannot vote. - Hold 2nd BM.
- Directors may now enter into the agreement.
- Interested director must make a declaration of interest in writing. - Advise registrar of where service contract can be inspected
- Draw up minutes
- retain contracts.
Provide a suggested procedure plan for share allotment and pre-emption rights approval.
- Hold BM and agree to call GM.
- Call GM on 14 days’ notice.
- Draft exact wording of SR needed to disappear any pre-emption rights and/or to amend AA’s.
- May also need OR authorising share allotment.
- Written resolution available. - Hold 2nd BM
- Directors may now allot shares complying with pre-emption rights in AA’s. - Advise registrar of any change to AA’s within 15 days and register a return of allotment within 1 month
- Make internal record of allotment and issue share certificates within 2 months.
- Update PSC register
- Draw up minutes.
Define the concepts involved in part 1 of the Model Articles.
Part 1 - interpretation and Limitation of liability
- Defined terms: key terms are defined. If not defined, the same meaning of any terms found in CA 2006 is used.
- LIABILITY OF MEMBERS: liability of members is limited to amount they owe on their shares and no more.
NB: concepts in bold are highly examinable.
Outline the different headings in part 2 of the Model Articles.
Outline the headings under part 2 of the Model Articles
Part 2 - Directors
- Directors powers and responsibilities
- Decision-Making by Directors.
- Appointment of directors.
What do the Model Articles (part 2) say about Directors’ powers and responsibilities?
- DIRECTORS’ GENERAL AUTHORITY: directors manage company’s business, subject to rules provided in AAs
- Shareholders reserve power: members can instruct directors to take, or refrain from taking an action.
- Directors may delegate: directors have wide powers if delegation to people or committees.
- Committees: committees given powers by directors generally follow procedures laid down in AA’s unless directors make other rules.
