Company Meetings and Meeting Procedures
Company meetings are formal gatherings of shareholders, directors or committees to decide matters. The exam tests types of meeting, notice, quorum, agenda, chairman, proxy, voting, resolutions and minutes.
Types and procedure
- Shareholders: annual general meeting (AGM) and extraordinary general meeting (EGM).
- Board meetings and committee meetings.
- Notice: AGM and EGM generally need 21 clear days; board meetings need 7 days, with shorter notice allowed on consent.
- Quorum: public AGM five members present; private company two; board meeting one-third of directors or two, whichever is higher.
- Agenda lists items; chairman conducts; proxy is available to shareholders, not directors.
- Resolutions: ordinary needs a simple majority; special needs at least 75% of votes cast.
- Minutes are recorded within 30 days and signed.
Worked example
A public company issues AGM notice 15 days before the meeting; three members attend. Reasoning: notice is short of 21 clear days unless the required consent is obtained. Quorum for a public AGM is five members personally present, so three cannot validly transact business. The meeting must be adjourned.
Traps that cost marks
- Counting proxies towards quorum; they do not count.
- Using board quorum for a shareholders' meeting.
- Confusing ordinary and special resolution majorities.
- Treating minutes as optional.