Mechanics of Corporate Decision-Making Flashcards
What are the Default Thresholds for Resolutions?
- 50.0001% for Board Resolutions (“BRs”).
- 50.0001% for Ordinary Resolutions (“ORs”).
- 75% for Special Resolutions (“SRs”).
CA 2006 — ss. 282-283.
Where can a Board Resolution be passed?
At a Board Meeting (“BM”).
Model Articles — Art. 7(1).
Where can a Shareholder Resolution be passed?
- At a General Meeting (“GM”); or
- In the case of Private Companies, in writing.
CA 2006 — s. 288.
At a General Meeting, how may Shareholders vote on a Resolution?
Either by a Show of Hands or a Poll.
CA 2006 — s. 284.
If the Shareholder is a corporation, it votes through its corporate representative, who it appoints by Board Resolution.
What is the Substantive Difference between a Vote by Show of Hands and a Vote by Poll?
- In a Poll, each shareholder is entitled to one vote per share; whereas
- In a Show of Hands, each Shareholder is entitled to one vote regardless of shareholding.
CA 2006 — s. 284(2)-(3).
Under the Companies Act, when may the Right to Demand a Poll be exercised?
- The matter does not concern the election of the Meeting’s Chairman or the Meeting’s adjournment; and
- The demand is made by:
- At least five Members;
- A Member or Members representing at least 10% of the voting rights of all Members entitled to vote on that Resolution; or
- A Member or Members holding shares conferring the right to vote on that Resolution, which have been paid up equal to at least 10% of the total sum paid up on that class.
CA 2006 — s. 321.
The Model Articles significantly relax these conditions.
Under the Model Articles, when may the Right to Demand a Poll be exercised?
Either:
* Before the GM;
* Before a Show of Hands on the Resolution; or
* Immediately after the result of a Show of Hands.
Model Articles — Art. 44(1).
Under the Model Articles, who may demand a Poll?
- The Chairperson;
- The Board of Directors;
- At least two Members entitled to vote on that Resolution; or
- A Member or Members representing at least 10% of the voting rights of all Members entitled to vote on that Resolution.
Model Articles — Art. 44(2).
Under the Model Articles, when may a demand for a Poll be withdrawn?
- When the Poll has not yet been taken; and
- The Chairperson consents to the withdrawal.
Model Articles — Art. 44(3).
Who may call a Board Meeting?
Any Director.
Model Articles —Art. 9.
What is the Quorum for a Board Meeting?
Two Directors.
Model Articles —Art. 11(2).
Procedurally, how are Board Resolutions decided?
By majority vote on Show of Hands, with the Chairperson withholding their vote to act as tiebreaker where necessary.
Model Articles — Arts. 7(1), 13(1).
Who may call a General Meeting?
The Board, by way of notice with 14 clear days.
CA 2006 — ss. 302, 307(1).
It notice is posted or emailed, it is deemed to be served 48 hours after sending (s. 1147).
The notice must contain the date, time, place, nature of business at the meeting, a statement of rights, and the text of the resolution(s).
When may a General Meeting be called on Short Notice?
If it is agreed to by:
* A nominal majority of Members; who
* Nominally hold at least 90% of the total nominal share capital.
What is the Quorum for a General Meeting?
Two Shareholders.
CA 2006 — s. 318(2).
For single-member Companies, it is only one (s. 318(1)).
