WS1: Company Procedure Flashcards
What is required for a board meeting to be valid?
Reasonable notice of the BM - meaning whatever notice is usual for directors to give.
Minimum of two directors to be quorate unless Articles have been amended to say otherwise
Board resolutions are passed: by a majority vote on a show of hands, with each director having one vote
When do matters need to be referred to the shareholders?
When a matter is outside the powers of the directors and must be approved by a shareholder resolution.
Examples
- Amending Articles
- Making a loan to the director of the company
How much notice is required for directors to call a General Meeting [meeting of shareholders]
14 clear days notice
What is the quorum for a GM for shareholders?
2
What is required after a GM?
Another BM, to enable the directors to implement whatever has been suggested in the GM.
BM - GM - BM
What is the short notice procedure for GMs?
A GM can be called if 90% and above of shareholders with voting rights agree.
[private companies]
What are the rules regarding written resolutions?
Only private companies can pass a shareholders’ resolution by way of written resolution.
Written Ordinary Resolution can be passed by a simply majority of the total voting rights of eligible members.
Written Special Resolution can be passed by a majority of members representing not less than 75% of total voting rights.
If a company has share capital - 1 member has 1 vote per share when doing a written resolution.
What resolutions cannot be passed in writing?
Resolution to remove a director or auditor from office
How must post-meeting matters be fulfilled?
Copies of all resolutions affecting the company’s constitution must be sent to the Registrar of Companies within 15 days of their being passed
These include all special resolutions, and certain ordinary resolutions
Amended articles must also be filed
What happens if PMM procedure is not followed?
Resolutions passed at meetings may be considered invalid
There can also be criminal sanctions in the form of a fine e/g/ if a company does not record minutes of meetings in relevant statutory books.
