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Members' general meetings (Agenda (Election of a chairperson,…
Members' general meetings
GMs are meetings of the members of the company, the term includes both AGMs and other GMs. Some jurisdictions do not differentiate between the different types of GMs, as nowadays their local company law may permit non trading/ asset holding companies (after obtaining permission from members) to elect not to hold AGMs
Apart from the routine business dealt with at GMs, they are usually called by the directors of the company where the decisions to be made affect the rights of the members of the company. These decisions can include
Change of name to the company
To commence the winding up of the company
To appoint a liquidator
To change the clauses in the constitutional documentation of the company
To change the purpose of (objects clause) of the company
To reduce or increase the authorised share capital
A GM is usually called by the board of directors, however in the majority of offshore jurisdictions, one or more members, representing a least one tenth of the issued voting shares may in writing specific the subjects / topics to be discussed and request that the directors convene a GM
If the directors fail to convene the meeting within 21 days (or as stated in the constitutional documentation) of receiving the request, the members concerned have the right to convene a GM within 3 months from the date of the request
The GM may, if the constitutional documentation and the law of the jurisdiction permit, be held at nay place in the offshore centre or elsewhere, as determined by the directors of the company
Annual general meeting
The first meeting should be held within a set statutory period, for example within 18 months beginning on the date on which it is entitled to commence business or from the date of incorporation, depending on the regulations in the local jurisdiction and / or the constitutional documentation of the company
After the first AGM, future AGMs are usually held every calendar year and there may be a set maximum period between such meetings, for example in Guernsey no more than 15 months elapsing between one AGM and the next
Notice of an AGM
Members entered on the company's members register should receive advance notice of GM meetings
Each member entitled to attend GMs should receive notice of all GMs
Each member should be notified of the date, time and place and full details of the proposed company resolution to be considered at the GM
The notice may be sent by post of electronically
If the details are shown on the limited company's website, the member should be sent a latter or email drawing their attention to it
Each member should receive their own notice of the members' meeting. The length under CA2006 is usually 14 days. Jersey is 14 days, BVI is 7 days and Cayman is 5
Where a notice is sent through the mail, CA2006 stipulates that it will be deemed to have been received 48 hours after posting, excluding weekends and bank holidays, unless a company's constitution documentation has a different rule
An AGM for a UK listed company requires 21 clear days notice, all other GMs and any GMs for UK private companies need only 14 clear days
For UK listed companies, the UK Corporate Governance Code requires the AGM notice and related papers to be sent to members at least 20 working days before the meeting
Short notice
It is possible for GMs to be held at short notice provided the requisite majority of members have consented in writing to short notice
There could be occasions when the subject or topic to be discussed at a GM by the members of the company cannot wait the statutory period for the jurisdiction of the company before a decision cn be made
Unless the company law or constitution documentation of the company states otherwise, the members of the company can arrange to hold a GM less than the stipulated time frae
Under CA2006 consent to short notice may be given in the case of
an AGM and by all the members entitled to attend and vote at GMs
GMs by a majority in number of the members holding not less than 90% of the shares and having the right to attend and vote at the GM
Special notice
There are two specific stations when special notice may be required
The removing of an auditor and appointing an auditor where there has been a chance since the last AGM
Removing of a director
Not given by the company but to the company by a member or members of the company
Notice of the relevant resolution should be given to the company at least 28 days before the meeting
Having received the special notice the company should inform members of the resolution when it gives notice of the GM
Usually included in the notices
Date, time and place of meeting
Whether it is an AGM or other GM
A summary of the business to be transacted
The full text of any special resolutions (if applicable) that are to be put before the meeting
Details of any special notice
An explanation fo the members' rights to appoint proxies
The name and signature of the secretary issuing the notice
Any explanatory notes
Agenda
Election of a chairperson
Confirmation of a quorum
Read and approve previous minutes if any
Appointment or re appointment of directors
Appointment or re appointment of officers of the company
Receive the financial statements of the company
Appointment or re appointment of auditors or confirmation of the unaudited status of the company
Consideration of the payment of a dividend
Ratification of all actions taken by directors since the last members' meeting if required under the articles
Proxy forms
If members are entitled to attend and vote at a GM of the company but is unable to attend in person, they may appoint another person to act on their behalf at the meeting by a form of proxy or as an alternative have a postal vote, known as a proxy vote
It is usual practice for proxy votes received by post only to be included as part of the quorum if they have been received at least 48 hours before the date of the meeting
Usually include different types of votes
For the motions
Against the motions
Vote being withheld
The proxy is by way of a poll one vote per share, which have a significant difference on the weighting of the vote
Each proxy form may be equivalent to one vote only