Shareholder decisions - general meetings Flashcards
(15 cards)
what are the requirements to pass a resolution?
o OR - requires more than 50% of votes to pass (a simple majority)
o SR - requires 75% or more of votes to pass
n/a duomatic principle
what is the duomatic principle?
SHs can take decisions informally if all SHs entitled to vote agree
what does it mean to call a meeting and how is a GM called?
call = to give notice
* Ds can call a GM at any time (usually by BR)
* Ds must call a GM if one has been requisitioned by SHs with at least 5% of the paid-up share capital that carries voting rights
if the SHs requisition a GM, when must Ds call the meeting? What recourse do SHs have if Ds fail to call the meeting?
Ds must call the GM within 21 days of the SH request + the GM must be held not more than 28 days after Ds call it (i.e. GM max. 7 weeks from SH request)
If Ds fail to convene a GM, the SHs can convene the GM within 3 months.
what form does the notice take? what must it inc? what powers do SHs have to obtain more information regarding the business of the meeting?
Notice can be in hard copy, electronic or posted the website (e-copy/website must have been previously agreed). It must inc.:
o Date, time, place and general business of GM
o The full text of any SRs (no equivalent requirement for ORs)
o SHs right to appoint a proxy
SHs holding at least 5% of voting rights can require the company to circulate a written statement of up to 1000 words regarding business to be dealt with at the GM
what are the notice requirements and when is the notice deemed served?
under CA 2006, a GM can be held on at least 14 clear days’ notice. This can be ext. by the AAs but not shortened
(Clear days = do not inc. the day on which notice is given or the day of the meeting)
Deemed service of notice (weekends + BHs not inc.):
o Personal delivery = the day of delivery
o Other delivery = two days after delivery (i.e. posted Mon - DS Wed)
when can a meeting be held on short notice?
Meeting can be held on shorter notice if practicable and:
o LTDs = a majority number of the SHs holding at least 90% agree (AAs can alter this but only up to 95%)
o PLCs = a majority number of the SHs holding at least 95% agree
Won’t be practicable i.e. if special notice is required, if documents must be available for inspection 15 days before the meeting
who must the notice be sent to?
Notice must be sent to all those entitled to receive it, i.e.:
o SHs recorded on the register of members (unless otherwise stated in AAs)
o Directors & auditors
what happens if notice and quorum requirements aren’t met?
- Failure to comply with notice requirements invalidates the GM
- If the meeting is inquorate, the business transacted will be void
explain the special notice procedure and when it is used
Special notice of a GM is required where the OR is to remove a D or auditor
SHs can requisition a GM. On receipt of the request, the company must:
o Send a copy of the special notice to the D concerned
o Give at least 28 clear days’ notice of GM. If Ds arrange the meeting within 28 days to try and frustrate OR, the OR will still be effective.
explain the position regarding proxies
SHs have a right to appoint a proxy to attend, speak and vote on their behalf
Corporate SHs would need to appoint a proxy/representative
what is the number for quorum?
2 unless the AAs specify otherwise
how can the vote be taken? Explain
- Show of hands = each SH gets one vote (standard voting method)
- Poll vote = each SH gets a number of votes equivalent to their shareholding
who can demand a poll vote under CA 2006 and MAs?
Under CA 2006, a poll vote can be demanded by:
o At least 5 SHs entitled to vote; or
o SH(s) with at least 10% of voting rights
Under MAs, a poll vote can be demanded before or at the GM by:
o The chair of the meeting
o Directors
o 2 or more persons with the right to vote
o SH(s) with at least 10% of voting rights
what are the post meeting administration requirements? (4)
- Preparing GM minutes inc. being signed by the chair
- GM minutes + decisions must be kept for 10 years at registered office or SAIL
- Company registers may need to be updated
- Documents may need to be filed with CH, i.e.:
o Forms i.e. removal of a D
o Some resolutions (or memorandum setting out its terms) must be filed with CH within 15 days of being passed:
All SRs
Only ORs regarding S551 authority to allot + authorising share buyback
