Calling and Holding AGMs

Laws, Standards and Good Practice

Kevin Prendergast, Head of Advocacy and Assessment, ODCE

Overview

Preparation for the AGM

Holding the AGM

After the AGM

Resolving problems

Overview

The AGM is the opportunity for the members as a group to meet and hold the board of directors to account

The opportunity to change directors/join the board

The opportunity to change the Memo and Articles

The opportunity to discuss and plan for the future

Overview

Should be run on an as inclusive manner as possible

All should be encouraged to attend All should be encouraged to participate

BUT Not an excuse to hog limelight or criticise

those who volunteer to be on the board Be constructive

Preparation for the AGM

The AGM must be held at least once every calendar year

Not more than fifteen months apart Other specific rules may be in Memo and

Articles Location? Time? Date?

Preparation for the AGM

Notice 21 days notice must be given for the AGM Notice must include audited financial

statements if they are to be discussed at the AGM

Any “special business” must be stated in the notice Ordinary business includes reviewing accounts,

and reappointing directors/auditors

Preparation for the AGM

Proxies Anyone attending a meeting has the right to

nominate a proxy ( note not legally mandatory for CLG’s, is in standard Articles)

Notice must also include proxy information Normally must be returned not less than 48

hours before meeting

Preparation for the AGM

Changing Directors Special Business If members want to change directors, must

give “extended notice” 28 days before meeting at which it is moved Directors then give all members 21 days

notice

Preparation for the AGM

Changing Directors However, just because a member submits

notice does not mean meeting will take place Need directors to agree to hold meeting Otherwise may have to requisition meeting

Members with 10% of voting rights

Legal advice recommended

Holding the AGM

Changing directors Memo and Articles normally require

directors to retire by rotation, every three years. Example worked out in AOMC Handbook

If no AGM, does not mean they are automatically retired

Holding the AGM

Changing directors Directors re-appointed, or not, by simple

majority Can always vote “NO” Company must have its minimum number of

directors (normally two) Memo and Articles would normally set

maximum also

Holding the AGM

Votes Votes taken by show of hands Majority of those present Any member can ask for a poll Then count based on number of votes held

(so for example if one person holds ten proxies, they get ten votes)

Holding the AGM

Votes Standard Articles state if a member owes

money to the company he cannot vote (Reg 23, Table C)

Only relates to amounts owed on shares for companies with shares (Reg 66, Table A)

Companies may remove or amend this

Holding the AGM

Chairing the AGM Normally one of the directors (the

Chairman) If no directors wish to chair, members can

elect a Chair

Holding the AGM

Auditors Have a right to attend Do not have to Generally automatically reappointed unless

a motion to change them

Holding the AGM

The Financial Statements The financial statements have to be a matter

for discussion They are NOT a matter for approval Directors have the responsibility and have

already approved Any non-approval by members is symbolic

After the AGM

Minutes Minutes are those of the Chair May be issued for approval before next

AGM Can also be signed by Chair and deposited

with company secretary All members have right of access to minutes

After the AGM

Financial Statements Approved financial statements filed with the

CRO Within 28 days of ARD

Resolving problems

ODCE does not get involved in corporate governance failings

Invalidating your own meetings is your own affair

Not all breaches of the law are criminal Criminal matters will be addressed

Failure to hold AGM

Resolving problems

Check out guidance available ODCE Quick Guide on AGMs Quick Guide for Residential Property Owners OMC Handbook

Use networks Get reputable legal advice

THANK YOU

Questions?