Introduction to this document

Notice of general meeting

The articles of the company will give the directors the power to call a general meeting (GM) of the company’s members (shareholders) in order to try to pass important decisions (resolutions). Use our notice to summon the company’s shareholders to such a meeting, if the need arises.

Reason for meeting

If something requires shareholder approval, e.g. amending the company’s articles, then a GM of the shareholders will need to be called, because only they can pass such an important piece of business that affects the company. It will usually be the directors who convene the meeting, by agreeing to do so at a board meeting. However, shareholders, provided they collectively own at least one tenth of the company’s shares, can also force the directors to call a GM. If the board fail to comply with this request within 21 days, the shareholders can go ahead and convene the meeting themselves.

There are generally two types of resolution that are up for discussion a special resolution and/or an ordinary resolution. All shareholders are entitled to receive notice of a GM and the company’s articles will specify how much notice must be given. The minimum required under the Companies Act 2006 is 14 days’ notice.

Tip

Before sending out the notices to convene the GM, doublecheck the shareholders’ register to ensure all the shareholders are notified and no one is omitted. Don’t forget either that the directors are also entitled to receive notice, whether or not they’re also shareholders.

Advice

If the notices are sent out using the post, the articles will again specify whether they’re to be sent out by first or second class post and when notice is deemed to be given, usually 48 hours after posting. Remember, a GM, unless the articles say otherwise, only needs 14 days’ clear notice. “Clear days” means exclusive of the day on which the notice is served and the day of the meeting.

Tips

Make sure the notice of GM gives the shareholders sufficient indication of what business is to be discussed at the meeting. Do this by setting out in full the resolutions that are to be proposed at the meeting.

The notice period can be dispensed with if shareholders holding at least 90% of the company’s shares agree.

Notices can be in hard copy form, or electronic, by means of posting on the company’s website, provided the shareholders have agreed. If the notice is published on a website, it must state that it’s about a company meeting, and also specify the place, date and time of the meeting. The notice must also be available on the company’s website throughout the period, i.e. from the date of notification to the conclusion of the meeting.

Meeting during the pandemic

During the coronavirus pandemic, holding in-person meetings has been difficult either because of national or local restrictions in force 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. The Notice of General Meeting has been amended to include this method of holding meetings.