Introduction to this document

Notice of class meeting

It may be necessary to call a meeting of a class of shareholders to decide matters only relevant to their class of shares. Use our model to give notice.

Holding a class meeting

Class meetings are usually held separately from general meetings. The procedure is likely to follow that for a general meeting, but check the company’s articles or the document that sets out the rights attached to the class of shares in question in case it differs. The Companies Act 2006 applies the general meeting rules as regards:

          the notice of the meeting

          quorum requirements

          the chairman of the meeting

          proxies and corporate representatives; and

          shareholders’ ability to circulate statements about the matters to be considered at the meeting.

If the meeting has been called to vary class rights, the quorum for the meeting is at least two shareholders who hold at least one third of the nominal value of the issued shares of the class in question. If the meeting has to be adjourned, it will be quorate if at least one person in the class attends. On a resolution to vary class rights, any member of the relevant class can demand a poll vote. Even if a class does not usually have the right to vote, if the resolution concerns a variation of their rights they are entitled to vote. For further information, see our Variation of Class Rights Checklist and Special Resolution.

NOTICE

Notice must be given to all members of the relevant class at least 14 clear days in advance of the meeting.

Meeting during the pandemic

Holding in-person meetings during the coronavirus pandemic has been difficult either because of national or local restrictions or because doing so would put participants at risk. Many companies can successfully hold meetings online. However, some cannot do so under their constitutions or for practical reasons such as shareholder numbers, access to the necessary technology, or willingness to meet remotely.

Written resolutions can be used in many cases, but private companies may have to hold a meeting because they are obliged to do so under their articles or they need to comply with a statutory procedure (and public companies are still obliged to hold AGMs).

To enable companies to fulfil their obligations without putting shareholders at risk, the Corporate Insolvency and Governance Act 2020 introduced temporary measures relating to meetings to allow companies that have to hold meetings between 26 March 2020 and 30 March 2021 to collect votes cast electronically without shareholders attending. Shareholders do not have a right to attend the meeting or participate in any way other than voting. This effectively converts the requirement to hold a meeting into a written resolution, still giving shareholders the right to participate in the decision, without having to meet in person and without the company having to manage discussions remotely. These temporary measures override any provisions in the company’s articles that deal with shareholder meetings and apply to any type of meeting, including class meetings. The Notice of Class Meeting has been amended to include this method of holding meetings. Companies should attach the text of the resolutions to be considered.