Week 8 - Board of Directors

Question 1

which documents determine how the company is governed?

Answer 1

• MOI

- the Act

Question 2

executive vs non-executive directors?

Answer 2

• non-exec set strategy, strategic thinking, dec making

- execs work within the day-to-day mgmt of the company

Question 3

what authority does the board have?

Answer 3

to exercise all of the powers and perform any of the functions of the company, except what the MOI/Act provides otherwise

Question 4

how does the board function?

Answer 4

through meetings

Question 5

what is a de facto director?

Answer 5

never legally appointed as a director (or was temporary but never renewed) and they continue to act as a director / participate in dec making – they are still subject to statutory duties

Question 6

how do directors become directors?

Answer 6

• elected by SH
• appointed by designated individual in the MOI
• holds the position by virtue another position (ex officio, becomes director automatically if they hold another position)

Question 7

what is a prescribed officer?

Answer 7

not director, but exercise general executive control over significant portions or the whole business

Question 8

how may directors be removed?

Answer 8

• SH
• board
• Comps Tribunal

Question 9

how are directors be removed by the SH?

Answer 9

in the general meeting through ordinary resolution, on any grounds. director must be given notice before meeting and be given chance to make representations

Question 10

how are directors be removed by the board?

Answer 10

a minimum of 3 directors; limited grounds for removal; only for ineligible, disqualified, incapacitation, derelict in performance of functions. director must be given notice before meeting and be given chance to make representations

Question 11

how may directors be removed by the Comps Tribunal?

Answer 11

same process as removal by board; usually used if 2 directors

Question 12

minimum directors required?

Answer 12

• 1 for private, PLC
• 3 for non-profit, public
• MOI may specify higher

Question 13

remuneration of directors?

Answer 13

allowed except to the extent that MOI disallows. may only be paid in accordance with special resolution approved by SH within the previous two years

Question 14

who/how are meetings called?

Answer 14

• authorized directors may at any time
• if at least 25% or 12 directors call it
• MOI may specify higher

Question 15

how may meetings be conducted?

Answer 15

• in person
• by electronic communication and the facility must enable all persons to participate effectively and without intermediary

Question 16

may a meeting be called without notice to all directors?

Answer 16

allowed if all directors acknowledge receipt, are present at meeting, and waive the notice

Question 17

what if there is a tied vote?

Answer 17

chair has the deciding vote; if chair already voted, the matter fails

Question 18

who may and may not be incl in committees?

Answer 18

• INCLUDE: non-members

- EXCLUDE: ineligible, disqualified, if not allowed to vote on a matter

Question 19

in what form may a resolution be adopted?

Answer 19

in writing or electronically – must still have written consent from the directors either in-person or electronically

Question 20

requirements of notice of meetings?

Answer 20

• be given 15 days prior (public) or 10 days prior (private) – MOI can say longer
• be in writing

Question 21

what must notice include?

Answer 21

• date
• time
• place
• general purpose of meeting
• copy of proposed resolutions to be tabled

Question 22

if there is non-compliance with notice formalities?

Answer 22

• unanimous assent at common law
• companies w one shareholders
• every SH is also a director

Question 23

what is a quorum?

Answer 23

minimum number of meeting attendants before any valid business can be transacted

Question 24

what are the quorum requirements for a valid meeting?

Answer 24

we need at least 25% of people entitled to vote on any matter to be present at the meeting

Question 25

what are the quorum requirements for a matter to be considered?

Answer 25

25% of SH entitled to vote on that matter must be present