|
Quick Links
|
Visit Our Archive for previous newsletters covering Hospitality, Recruitment, Intellectual Property, Food & Drink, Commercial Property, Employment, Hotels, Restaurants, Start Ups and many other topics
|
 |
|
|
Find Previous Featured Articles
| 
Nov/Dec 2012
Top Ten Legal Tips for Company Directors & Company Restorations
October 2012
New Workplace Pensions Regulations & Changing Employment Terms
September 2012
Luxury Goods And Services, Website Contracts and Cookies
August 2012
The Olympics and Legal Implications of High Profile Events
July 2012
Hedging, LIBOR and Why Canadian Banks Are Setting Benchmarks
June 2012
May 2012
Employee Incentives and Share Option Schemes
April 2012
Hotels
March 2012
Marketing
February 2012
International Services
January 2012
Contract Law
December 2011
November 2011
Recruitment
October 2011
Intellectual Property Update
September 2011
Commercial Disputes
July/August 2011
Holidays, Gym Memberships, Nights Out
June 2011
Social Media and Comparative Advertising
Visit Our Archive for previous newsletters covering Hospitality, Recruitment, Intellectual Property, Food & Drink, Commercial Property, Employment, Hotels, Restaurants, Start Ups and many other topics
|
|
Quick Links
|
Visit Our Archive for previous newsletters covering Hospitality, Recruitment, Intellectual Property, Food & Drink, Commercial Property, Employment, Hotels, Restaurants, Start Ups and many other topics
|
|
|
Quick Links
|
Visit Our Archive for previous newsletters covering Hospitality, Recruitment, Intellectual Property, Food & Drink, Commercial Property, Employment, Hotels, Restaurants, Start Ups and many other topics
|
|
|
|
Dear Subscriber,
Happy New Year!
Welcome to our January newsletter.
2013 is here and we are in full swing already! We hope you all managed to get some well needed rest and recharged your batteries ready for a great year again. The number 13 is lucky in some cultures and unlucky in others; let's hope you're looking at the glass half full!
This month's article elaborates on one of the points we brought to your attention last month in our "Top 10 Company Law tips for Company Directors" article. This month we focus on Annual General Meetings (AGMs). If you are a small company, AGMs might not be something that has crossed your mind in the past, however your articles may include provisions as to whether or not you are legally required to hold one. Since the Companies Act 2006 has been brought in, there have been numerous changes which affect incorporated companies including the ability to waive AGM requirements.
Our client of the month is Dental Professionals Limited who we assisted through the entire AGM process. They are an alliance of dentists operating as a limited company that have recently undergone some changes in the structure of their company. This included consolidation of shares and a return of capital to shareholders together with amendments to their Articles of Association. The AGM was held towards the end of last year in order to reflect these changes and to ensure all directors, shareholders and interested parties were fully aware.
Don't forget about our new service we have to offer which has officially launched this month. Company Restorations are growing increasingly popular, with many directors being in the position of being in charge of a dissolved company with assets that they have no access to. We can help you restore your company back to the register, whether you struck it off voluntarily or Companies House did, and whether you want to continue trading or recover assets.
|
|
Shainul Kassam
Fortune Law Solicitors |
|
Featured Client: Dental Professionals Limited
www.dentalprofessionalsltd.co.uk
Mustapha Laljee
 | | Mustapha Laljee |
"We are a small company and were undergoing radical changes within our set-up last year.
Fortune Law acted for us on our instructions. They then helped us in ensuring our actions were delivered smoothly.
Good, unemotional, competent advice is what we needed for our business. Fortune Law's team consistently provided this, together with an excellent relationship and an understanding of our business issues.
They really took the time to understand our business. They created a personalized transition plan that helped streamline our business processes and prepare us for the future. We really appreciate the time they dedicated to helping our company move forward.
They certainly added value, ensuring our actions were well-informed and helped us to unravel complex legislation. "
|
AGM - Annual General Meetings
If you are a director of a private company, you may be required to hold an Annual General Meeting (AGM) once a year. This will depend on what your Articles of Association say and should usually set out the rules on how an AGM should be run and what matters should be dealt with. Although it is a formal meeting, it can also be a good opportunity to communicate with members, clients, partners and other interested parties.
Am I required to hold an AGM?
Private companies (not traded) - the Companies Act 2006 neither requires them to hold AGMs nor prevents them from doing so. Therefore, such a company will only need to hold AGMs where required to do so by its articles. Private companies formed prior to 1 October 2007 may need to amend their articles (or adopt new articles) in order to avoid the need to hold AGMs.
Private companies (traded) - Are required to hold AGMs. This requirement came into effect on 3 August 2009.
Public companies- Under section 336(1) public companies are obliged to hold an AGM within the period of six months beginning with the day following its accounting reference date.
Charities- Even though it is not required, it is good practice for charities to hold an AGM to deal with issues such as the election of committee/board members and reviewing the annual accounts.
First Stage- Preparing for an AGM
Calling a meeting
By directors- The board of directors has the power to call general meetings and the vast majority of general meetings will be called by the board. The articles may contain provisions relating to directors' ability to call general meetings (though they cannot override the Companies Act 2006 and prevent the board from calling general meetings). It is recommended that the board records minutes documenting the meeting at which the directors resolve to call a general meeting.
By members- Section 303 of the Companies Act 2006 requires the directors to call a general meeting once the company has received requests to do so:
- For companies with a share capital, from members representing at least 5% of such of the paid-up capital of the company as carries the right of voting at general meetings of the company (excluding any paid-up capital held as treasury shares).
- For companies without a share capital, from members who represent at least 5% of the total voting rights of all the members having a right to vote at general meetings.
Issue notice
It is critical to check the notice provisions of a company's articles. The notice of general meeting must contain all information required by statute and regulations, a summary of which is set out in the checklist below. For listed companies, the notice is usually contained in a separate circular to shareholders. Failure to meet these requirements could lead to a notice being invalid and the company having to start again.
The notice of meeting must:
- State the date, time and place of the meeting
- Set out the general nature of business to be dealt with
- Provide a clear and adequate explanation of its subject matter
- For a public company's AGM, it must state that the meeting is an annual general meeting and if relevant, include details of a shareholders' resolution
- Include the full text of special resolutions and the intention to propose such a resolution as special. It is recommended to also include the full text of an ordinary resolution, although there is no legal requirement to do so.
- Include the date of the notice and details of the company's registered office.
- Should contain a statement of rights in respect of the appointment of proxies
- Be signed by a director or company secretary.
Articles
A company's articles can lengthen the minimum notice period required for general meetings. Note that articles of companies formed before 1 October 2007 are particularly likely to require 21 days' notice for any general meeting at which either:
- One or more special resolutions are to be considered; or
- A resolution appointing a person as a director is proposed.
|
Type of Company
|
AGM
|
Other general meeting
| |
Private
(not traded)
|
14 clear days
|
14 clear days
| |
Private (traded)
|
21 clear days
|
21 clear days reduced to 14 clear days where certain conditions are satisfied
| |
Public (not traded)
|
21 clear days
|
14 clear days
| |
Public (traded)
|
21 clear days
|
21 clear days reduced to 14 clear days where certain conditions are satisfied
|
Annual reports and accounts
There is a statutory obligation for public companies to lay their annual reports and accounts before the company in a general meeting. Usually this will be carried out at the AGM. There is no similar obligation for private companies.
The annual reports and accounts generally consist of: annual accounts; a directors' report; a directors' remuneration report; an auditor's report on the accounts and on the auditable part of the directors' remuneration report and the directors' report; and a corporate governance statement.
Second Stage- Conduct an AGM
Chairman
The articles of association will usually set out who may be appointed chairman of the meeting. The articles of the Companies Act 2006 (CA 2006) can be adapted to allow a shareholder or a proxy to be appointed as chairman.
The chairman has authority to preside over and run a meeting of the company's shareholders. Most of the chairman's powers will be set out in the articles and he must at all times act reasonably and in good faith when exercising these powers. He has a duty to ascertain "the true sense of the meeting" and to ensure that the views of all the shareholders present are heard.
Quorum
A minimum number of people in attendence is required to conduct valid business at a meeting. If there are insufficient people the meeting is said to be inquorate and resolutions passed at the meeting will be invalid. The articles should be checked regarding the number of persons required to satisfy the quorum requirements. If the articles are silent, two qualifying persons (apart from single member companies) present at the meeting will constitute a quorum, unless they are both representatives of the same corporation or they are both proxies appointed by the same shareholder
Under section 318(3), a qualifying person is:
- A shareholder.
- A corporate representative.
- A proxy.
The articles will usually permit the chairman to delay the start of the meeting for a period of time. If a quorum is not present within this time, the chairman should, in accordance with the articles, adjourn the meeting. The quorum must be present throughout the meeting.
Final Stage- Post AGM formalities
Following a general meeting, it is the responsibility of the company secretary or its equivalent to ensure that all minutes and resolutions of the meeting are prepared, signed by the chairman and filled as appropriate and all relevant documents are filed at Companies House and posted on the company's website (where relevant). Listed companies must also file relevant documents with the Financial Services Authority (FSA) and announce the results of the votes via a Regulatory Information Service (RIS) immediately following the meeting. Companies listed on other stock exchanges will need to comply with the filing requirements of the relevant exchange.
We are specialist company commercial legal advisers. If you have an issue involving company law matters, Fortune Law has the necessary expertise to advise and help. Please get in touch by telephone on 020 3102 6372 or by email at enquiries@fortunelaw.com
|
|
|
|
|
