A board meeting is a meeting of the Board of Directors. In order for Directors to exercise their powers they must do so collectively. The formal procedure for this it to convene a board meeting at which they will resolve and agree to exercise these powers for a particular purpose. Directors meetings are usually held frequently and are quite informal.
However, it is important to advise Directors that there are certain legal requirements that they must comply with. Table A provides that the regulation of meetings is a matter for directors and articles of association.
Each board meeting of a company requires a Chairperson. The Directors of the Company may elect a chairperson for that meeting and decide how long they shall remain as chairperson. The chairperson of a board meeting is usually one of the Directors present who has been elected by fellow Directors. A meeting can be convened by any one of the Directors. Reasonable notice must be given to all the Directors. If Directors want to hold meetings electronically, the articles of association must specifically provide for electronic meetings.
The Articles of Association will set out the quorum for the meeting and Table A sets the quorum at 2 Directors. Each Director has one vote and a resolution requires a simple majority. The Chairman may have a casting vote in case of a tie.
The Companies Acts provide that the minutes of all proceedings at meetings of Director should be entered in a minute book as soon as possible. Anything outside the normal course of business should be approved by the Directors.
A General meeting is a meeting of the members of a Company. There are two types of members meetings:-
- Annual General Meetings “AGM”
- Extraordinary General Meeting “EGM”
An AGM is a statutory requirement under the Companies Acts which provides that every company shall in each year hold a general meeting as its annual general meeting. The AGM should be held within 9 months from the financial year end and not more than 15 months since the last AGM. The first AGM must be held within 18 months of the Date of Incorporation. Single Member Private Limited Companies may dispense with holding the AGM every year .
In order to comply with the Companies Acts, companies should prepare the following AGM documentation:- ?
- Minutes of Meeting of Directors
- ?Notice of AGM
- ?Consent to Short Notice (if applicable)
- ?Proxy Forms?
- Minutes of AGM
The main purpose of the Directors meeting is to review, approve and sign the financial statements of the company. The Directors also resolve to hold an AGM.
The Company then must send notice of AGM to all registered members entitled to receive notice and to attend the AGM.
The Company’s Auditor is also entitled to receive notice and attend.?
?The Companies Acts provide that 21 days clear notice must be give for the AGM and that all AGM’s must be held in the state unless the articles have been amended.
The standard business to be dealt with at an AGM as provided in Table A:-
- Receive & consider accounts, balance sheet and reports of the directors and auditors
- Declare a Dividend
- The re-election of directors to replace those retiring
- Re-appointment of auditors
- Fixing of the auditors remuneration
- Depends on what is contained in the articles
Other business can also be dealt with at an AGM but will be dealt with as special business.
AGM’s can be called by shorter notice once the consent of all Members and Auditors is given in writing. The Companies Acts allow members entitled to attend and vote to cast their vote in person or by proxy. Instrument appointing proxy must be in writing and Table A provides that the proxies must be delivered not less than 48 hours before the meeting.
Table A Part I provides that a quorum for a General meeting is three members unless amended and Table A Part II provides for 2 members so always check the Articles first.
Voting is done by a Show of Hands or Poll. On a Show of Hands its 1 member 1 vote and a Poll is 1 Share 1 vote. A poll can be demanded by the Chairman or 3 members in person or by proxy.
The Companies Acts provide that every company shall as soon as may be cause minutes of all proceedings of general meetings to be entered in books kept for that purpose.
All meetings of the members other than AGM’s are Extraordinary General Meetings. EGM’s are used to vote on resolutions put to the members by the Directors. EGM’s may be convened by: ?
- The Directors
- ?Qualified Members
- 10% of voting rights
- ?By order of the Court
- ?On the request of retiring Auditors
The length of notice to be given for an EGM depends on the types of resolutions being voted on by the members. 7 days notice must be give for ordinary resolutions and 21 days notice for special resolutions.
A common EGM held by companies is when there is a serious loss of capital and the Directors are required to hold an EGM pursuant to Section 40 Companies (Amendment) Act 1983 to deal with the situation.