Chapter 20 Company Meetings and Resolutions

Question 1

What is a meeting?

Answer 1

An assembly of people for a particular purpose, especially for formal discussion

Question 2

When do decision of a general meeting become valid?

Answer 2

If the meeting is properly convened by notice and if the business of the meeting is fairly and properly conducted

Question 3

When members’ approval is required in general meeting?

Answer 3

If the directors wish to:
1)Exceed their delegated power
2)Allot shares
3)Make a substantial contract of sale or purchase with a director
4)Grant a director a long service agreement

Question 4

How many kinds of general meeting are there in a company?

Answer 4

2 kinds
1)Annual General Meeting(AGM)
2)General meetings at other times

Question 5

When do shorter notice for AGM is valid?

Answer 5

If 90% members agree

Question 6

What is the business of an annual general meeting?

Answer 6

It usually includes:
1)Considering the accounts
2)Receiving directors’ report, directors’ remuneration report, auditors’ report
3)Dividends
4)Electing directors
5)Appointing auditors

Question 7

When do a court orders for general meeting?

Answer 7

On the application of a director or a member entitled to vote, may order that a meeting shall be held and may give instructions for that purpose, including fixing a quorum of one

Question 8

What is a written resolution?

Answer 8

It is for private companies and can be used for all general meetings except for removing a director or auditor before their term of office expires

Question 9

What are the differences between ordinary and special resolution?

Answer 9

Apart from the required size of majority and period of notice, the main differences are
1)The text of special resolution must be set out in full in the notice convening the meeting, and it must be described as a special resolution
2)A signed copy of every special resolution must be delivered to the registrar for filing

Question 10

When a special resolution is required?

Answer 10

It is required for major changes in the company such as
1)A change of name
2)Restrictions of the objects or other alterations of the articles
3)Reduction of share capital
4)Winding up the company

Question 11

Is it necessary for written resolution to be accompanied by a statement?

Answer 11

Yes it should be accompanied by a statement informing:
1)How to signify their agreement to the resolution
2)The date the resolution must be passed by

Question 12

When do members can propose a written resolution?

Answer 12

Members holding 5% of the voting rights may request a written resolution, providing it:
1)would be effective
2)Is not defamatory, vexatious or frivolous

Question 13

Within how many days of the request for resolution, copies of resolution and statements must be sent to each member?

Answer 13

Within 21 days

Question 14

Who bear the expenses for circulating a written resolution?

Answer 14

The members who request it

Question 15

What is the default period of agreement to a resolution?

Answer 15

28 days from the date the resolution was circulated, after which the agreement is ineffective

Question 16

What are the consequences if the auditors are not sent a copy of written resolution?

Answer 16

The resolution remains valid;however the directors and secretary will be liable to a fine

Question 17

When do special notice of a resolution must be given to the company?

Answer 17

It must be given for any of the following reasons:
1)to remove or appoint an auditor other than the auditor who was appointed at the previous year’s meeting
2)to remove a director or to appoint a substitute in their place after removal

Question 18

When do decision of a meeting become binding?

Answer 18

A meeting can only reach binding decisions if:
1)It has been properly convened by notice
2)A quorum is present
3)A chairman presides
4)The business is properly transacted and resolutions are put to the vote

Question 19

In the absence of chairman who can preside the meeting ?

Answer 19

Directors chosen by other directors or as a last resort members chosen by the members present

Question 20

What are the duties of a chairman?

Answer 20

To maintain order during meeting and to deal with the agenda in a methodical way so that the business of the meeting may be properly transacted

Question 21

What is a quorum?

Answer 21

Minimum number of persons required to be present in a particular type of (company)meeting

Question 22

What is the role of a proxy?

Answer 22

A person appointed by a shareholder to vote on behalf of that shareholder at company meetings

Question 23

How many votes a member have under the show of hands method of voting?

Answer 23

Each member has one vote irrespective of the number of shares held

Question 24

How many vote a member can use under poll method of voting?

Answer 24

A member can use as many votes as their shareholding grant them

Question 25

How and when do members can demand voting on a poll?

Answer 25

It may be demanded by:
1)Not less than 5 members
2)Member(s) representing not less than one-tenth of the total voting rights
3)Member(s)holding shares which represent not less than one-tenth of the paid up capital

Question 26

How the results of a vote are determined?

Answer 26

The number of votes cast determine the results

Question 26

For quoted companies what are the information regarding vote which should be made available and remain on the website for at least 2 years?

Answer 26

1)Meeting date
2)Text of the resolution or description of the poll’s subject matter
3)Number of votes for and against the resolution

Question 27

For how many years a company has to keep minutes of the meeting?

Answer 27

Fo10 years

Question 28

What are the admissible evidence of the meeting?

Answer 28

The signed minutes are the admissible evidence of the proscedings

Question 29

How a unanimous decision of members is treated against formal decision in general meeting?

Answer 29

A unanimous decision of members is often treated as a substitute for a formal decision in general meeting properly convened and held, and is equally binding

Question 30

When do class meetings held?

Answer 30

Class meeetings held where the interest of different groups of shareholders may be affected in different ways

Question 31

What is the requirement which must be satisfied when the quorum of the meeting is one person?

Answer 31

The person must still hold at least one third of the shares