LML4806
EXAM PACK
2025
, lOMoARcPSD|41752181
1 Shareholders and Company Meetings
1.1 Introduction
Shareholder:
Term used only in respect of a profit company.
Person who is entitled to exercise any voting rights in relation to a company, irrespective of the form, title or
nature of the securities to which those voting rights are attached.
Retain control over the directors by their power to appoint and remove directors
Approve important decisions of the directors
Member:
Term used for non-profit companies who do not have shareholders
Directors:
Have authority to exercise all powers and perform any of functions of the company, except to extent that Act or
company’s Memorandum of Incorporation provides otherwise
Have a duty to manage the company
1.2 Notice of Meetings
Notice must:
be in writing
include date, time and place for the meeting
explain general purpose of the meeting;
contain a statement that a shareholder is entitled to appoint a proxy to attend, participate in and vote at the
meeting in the place of a shareholder
should indicate the participants will be required to provide proof of identity at the meeting
be accompanied by a copy of any proposed resolution which will be considered at the meeting
indicate percentage of voting rights required for the resolution to be adopted
Notice before date of meeting:
Public company & non-profit company with voting members: 15 business days
Any other company: 10 business days
MOI may prescribe longer minimum notice
Notice convening AGM:
must contain summary of the financial statements
must explain procedure shareholder can follow to obtain complete financial statements
Defective notice:
Meeting may proceed if:
Persons who are entitled to vote i.r.o. each item on agenda:
are present
acknowledge actual receipt of notice
agree to waive notice of meeting / ratify defective notice
Where defect relates to one/more matters on the agenda:
matter may be taken off agenda; notice remains valid w.r.t. remaining matters
where defective notice ratified: meeting may consider matter
1.3 Representation by Proxy
Getz v Spaarwater: Validity or otherwise of proxy must depends on facts of each case. Material departure from
prescribed form may invalidate proxy. Here: only date of execution on form left blank and this non-compliance was
judged to not be of a material nature.
Davey and others v Inyaminga Petroleum: cf. Getz. Prescribed form required proxy giver to set out number of shares
i.r.o. which he was authorizing proxy to vote. Non-compliance was judged to be of a material nature and proxy was thus
incomplete and invalid.
Ingre v Maxwell: Must be at least 2 persons present to constitute a meeting; not valid where 1 person holds all
proxies of all persons who were entitled to attend meeting.
Downloaded by Enos ()
, lOMoARcPSD|41752181
The appointment of a proxy:
in writing and signed by shareholder;
valid for one year;
may be for a specific period of time;
may be for two or more persons concurrently exercising voting rights for different shares;
proxy may delegate authority to act on behalf of the shareholder to another person;
copy of the proxy appointment form must be delivered to the company before the shareholders’ meeting;
shareholder is not compelled to make an irrevocable proxy appointment;
shareholder may alter proxy by cancelling it in writing, appointing another proxy and deliver a copy of the
revocation to the proxy and the company.
appointment remains valid until end of meeting for which it was intended to be used.
Proxy is entitled to vote as he/she sees fit, unless shareholder indicated on proxy form how proxy should vote.
1.4 Demand to convene a shareholders’ meeting
Board of company/any other person specified in MOI may call a shareholders’ meeting at any time.
Meeting must be convened:
at any time required by the CA or MOI, i.e. to elect a director
if one/more written and signed demands for such a meeting are delivered to the company.
Relevant points when demand is made:
demand must specify purpose of meeting
demand must be signed by holders of at least 10% of voting rights
MOI may specify a lower percentage than 10%
Company/shareholder may apply for order setting aside demand for meeting on following grounds:
Vexatious
Frivolous
Matter has already been considered and decided upon by shareholders
Demand may be withdrawn before start of meeting.
1.5 Shareholders acting other than at a meeting
Gohlke and Schneider v Westies Minerale: members may validly appoint a director to the board without any formal
meeting being held because there was evidence of their unanimous consent.
In re Duomatic Ltd: unanimous approval of directors’ remuneration by the two directors holding all the voting shares
in a company could be regarded as a resolution of a general meeting approving the payment.
CA: Resolution may be submitted to shareholders and, if adopted in writing by the required majority, will have the
same effect as if it had been adopted at a meeting without actually holding a general meeting of shareholders (s 60).
Thus: unanimous assent of all shareholders is no longer necessary.
No business that must, in terms of the CA or the company’s MOI, be conducted at an annual general meeting may be
conducted by using this procedure.
1.6 Annual General Meeting
1st AGM must occur no more than 18 months after company’s date of incorporation.
Subsequent AGMs must occur no more than 15 months after the previous AGM.
Section 61(8): following matters must be transacted at the AGM:
Election of directors to the extent required by the Act or the company’s MOI;
Appointment of an auditor for the following financial year;
Appointment of an audit committee;
Presentation of the directors’ report;
Presentation of audited financial statements for the immediately preceding financial year;
Presentation of an audit committee report;
Any matter raised by shareholders.
1.7 Convening a meeting in special circumstances
If a company cannot convene a meeting because it has no directors/the directors are incapacitated:
Any person authorized by the MOI may convene a meeting
Downloaded by Enos ()
, lOMoARcPSD|41752181
If MOI does not authorize anybody: shareholders may request Companies Tribunal to issue an administrative
order for a meeting to be held.
If a company fails to convene a meeting for any reason other than the above
(a) at a time required in accordance with its Memorandum of Incorporation;
(b) when required by shareholders; or
(c) within the time required
a shareholder may apply to a court for an order requiring the company to convene a meeting on a date, and subject
to any terms, that the court considers appropriate in the circumstances.
1.8 Quorum
Shareholders’ meeting may not begin until sufficient persons are present at the meeting to exercise, in aggregate,
at least 25% of all of the voting rights that are entitled to be exercised in respect of at least one matter to be
decided at the meeting; and
A matter to be decided at the meeting may not begin to be considered unless sufficient persons are present at
the meeting to exercise, in aggregate, at least 25% of all of the voting rights that are entitled to be exercised on
that matter at the time the matter is called on the agenda.
The company’s MOI may provide for a lower/higher percentage to constitute a quorum
If a company has more than two shareholders, a meeting may not begin, or a matter begin to be debated, unless
at least 3 shareholders are present at the meeting, provided the members can exercise at least 25% of the voting
rights that are entitled to be exercised.
1.9 Conduct of meetings
Voting may be conducted by:
A show of hands: any person can have only 1 vote, regardless of amount of shares held
A poll
Where a person fails to exercise his/her vote: person is deemed to have voted against the resolution.
1.10 Majority rule
Sammel & Others v President Brand Gold Mining Co Ltd: Where a person becomes a shareholder in a company,
he/she agrees to be bound by the decision of the majority of the shareholders.
1.11 Exercise of voting rights
Pender v Lushington: shareholders, unlike directors, do not exercise their voting rights for the benefit of the company
and can act entirely in their own interests. A shareholder has a right to have his or her vote recorded, even if that vote
made no difference to the final results.
3 Scenarios:
1. A profit company (other than a state-owned enterprise) with only one shareholder:
i. shareholder may exercise all the voting rights.
ii. rules of setting a record date etc. do not apply.
2. A profit company (other than a state-owned enterprise) with only one director:
i. director may exercise any power/perform any function of the board at any time except when the MOI
provides otherwise.
3. A company (other than a state-owned enterprise) where every shareholder is also a director:
i. Shareholders may decide on any matter to be referred by the board at any time, without notice or
compliance with any internal formalities except when the Memorandum provides otherwise; subject to
certain specified conditions
1.12 Shareholder resolutions
CA provides 2 types of resolutions:
1. Ordinary resolution
i. Requires 50% or more of the voting rights exercised on the resolution
ii. MOI may require a higher percentage
2. Special resolution
i. Requires 75% or more of the voting rights exercised on the resolution
ii. MOI may require a lower percentage
Downloaded by Enos ()
EXAM PACK
2025
, lOMoARcPSD|41752181
1 Shareholders and Company Meetings
1.1 Introduction
Shareholder:
Term used only in respect of a profit company.
Person who is entitled to exercise any voting rights in relation to a company, irrespective of the form, title or
nature of the securities to which those voting rights are attached.
Retain control over the directors by their power to appoint and remove directors
Approve important decisions of the directors
Member:
Term used for non-profit companies who do not have shareholders
Directors:
Have authority to exercise all powers and perform any of functions of the company, except to extent that Act or
company’s Memorandum of Incorporation provides otherwise
Have a duty to manage the company
1.2 Notice of Meetings
Notice must:
be in writing
include date, time and place for the meeting
explain general purpose of the meeting;
contain a statement that a shareholder is entitled to appoint a proxy to attend, participate in and vote at the
meeting in the place of a shareholder
should indicate the participants will be required to provide proof of identity at the meeting
be accompanied by a copy of any proposed resolution which will be considered at the meeting
indicate percentage of voting rights required for the resolution to be adopted
Notice before date of meeting:
Public company & non-profit company with voting members: 15 business days
Any other company: 10 business days
MOI may prescribe longer minimum notice
Notice convening AGM:
must contain summary of the financial statements
must explain procedure shareholder can follow to obtain complete financial statements
Defective notice:
Meeting may proceed if:
Persons who are entitled to vote i.r.o. each item on agenda:
are present
acknowledge actual receipt of notice
agree to waive notice of meeting / ratify defective notice
Where defect relates to one/more matters on the agenda:
matter may be taken off agenda; notice remains valid w.r.t. remaining matters
where defective notice ratified: meeting may consider matter
1.3 Representation by Proxy
Getz v Spaarwater: Validity or otherwise of proxy must depends on facts of each case. Material departure from
prescribed form may invalidate proxy. Here: only date of execution on form left blank and this non-compliance was
judged to not be of a material nature.
Davey and others v Inyaminga Petroleum: cf. Getz. Prescribed form required proxy giver to set out number of shares
i.r.o. which he was authorizing proxy to vote. Non-compliance was judged to be of a material nature and proxy was thus
incomplete and invalid.
Ingre v Maxwell: Must be at least 2 persons present to constitute a meeting; not valid where 1 person holds all
proxies of all persons who were entitled to attend meeting.
Downloaded by Enos ()
, lOMoARcPSD|41752181
The appointment of a proxy:
in writing and signed by shareholder;
valid for one year;
may be for a specific period of time;
may be for two or more persons concurrently exercising voting rights for different shares;
proxy may delegate authority to act on behalf of the shareholder to another person;
copy of the proxy appointment form must be delivered to the company before the shareholders’ meeting;
shareholder is not compelled to make an irrevocable proxy appointment;
shareholder may alter proxy by cancelling it in writing, appointing another proxy and deliver a copy of the
revocation to the proxy and the company.
appointment remains valid until end of meeting for which it was intended to be used.
Proxy is entitled to vote as he/she sees fit, unless shareholder indicated on proxy form how proxy should vote.
1.4 Demand to convene a shareholders’ meeting
Board of company/any other person specified in MOI may call a shareholders’ meeting at any time.
Meeting must be convened:
at any time required by the CA or MOI, i.e. to elect a director
if one/more written and signed demands for such a meeting are delivered to the company.
Relevant points when demand is made:
demand must specify purpose of meeting
demand must be signed by holders of at least 10% of voting rights
MOI may specify a lower percentage than 10%
Company/shareholder may apply for order setting aside demand for meeting on following grounds:
Vexatious
Frivolous
Matter has already been considered and decided upon by shareholders
Demand may be withdrawn before start of meeting.
1.5 Shareholders acting other than at a meeting
Gohlke and Schneider v Westies Minerale: members may validly appoint a director to the board without any formal
meeting being held because there was evidence of their unanimous consent.
In re Duomatic Ltd: unanimous approval of directors’ remuneration by the two directors holding all the voting shares
in a company could be regarded as a resolution of a general meeting approving the payment.
CA: Resolution may be submitted to shareholders and, if adopted in writing by the required majority, will have the
same effect as if it had been adopted at a meeting without actually holding a general meeting of shareholders (s 60).
Thus: unanimous assent of all shareholders is no longer necessary.
No business that must, in terms of the CA or the company’s MOI, be conducted at an annual general meeting may be
conducted by using this procedure.
1.6 Annual General Meeting
1st AGM must occur no more than 18 months after company’s date of incorporation.
Subsequent AGMs must occur no more than 15 months after the previous AGM.
Section 61(8): following matters must be transacted at the AGM:
Election of directors to the extent required by the Act or the company’s MOI;
Appointment of an auditor for the following financial year;
Appointment of an audit committee;
Presentation of the directors’ report;
Presentation of audited financial statements for the immediately preceding financial year;
Presentation of an audit committee report;
Any matter raised by shareholders.
1.7 Convening a meeting in special circumstances
If a company cannot convene a meeting because it has no directors/the directors are incapacitated:
Any person authorized by the MOI may convene a meeting
Downloaded by Enos ()
, lOMoARcPSD|41752181
If MOI does not authorize anybody: shareholders may request Companies Tribunal to issue an administrative
order for a meeting to be held.
If a company fails to convene a meeting for any reason other than the above
(a) at a time required in accordance with its Memorandum of Incorporation;
(b) when required by shareholders; or
(c) within the time required
a shareholder may apply to a court for an order requiring the company to convene a meeting on a date, and subject
to any terms, that the court considers appropriate in the circumstances.
1.8 Quorum
Shareholders’ meeting may not begin until sufficient persons are present at the meeting to exercise, in aggregate,
at least 25% of all of the voting rights that are entitled to be exercised in respect of at least one matter to be
decided at the meeting; and
A matter to be decided at the meeting may not begin to be considered unless sufficient persons are present at
the meeting to exercise, in aggregate, at least 25% of all of the voting rights that are entitled to be exercised on
that matter at the time the matter is called on the agenda.
The company’s MOI may provide for a lower/higher percentage to constitute a quorum
If a company has more than two shareholders, a meeting may not begin, or a matter begin to be debated, unless
at least 3 shareholders are present at the meeting, provided the members can exercise at least 25% of the voting
rights that are entitled to be exercised.
1.9 Conduct of meetings
Voting may be conducted by:
A show of hands: any person can have only 1 vote, regardless of amount of shares held
A poll
Where a person fails to exercise his/her vote: person is deemed to have voted against the resolution.
1.10 Majority rule
Sammel & Others v President Brand Gold Mining Co Ltd: Where a person becomes a shareholder in a company,
he/she agrees to be bound by the decision of the majority of the shareholders.
1.11 Exercise of voting rights
Pender v Lushington: shareholders, unlike directors, do not exercise their voting rights for the benefit of the company
and can act entirely in their own interests. A shareholder has a right to have his or her vote recorded, even if that vote
made no difference to the final results.
3 Scenarios:
1. A profit company (other than a state-owned enterprise) with only one shareholder:
i. shareholder may exercise all the voting rights.
ii. rules of setting a record date etc. do not apply.
2. A profit company (other than a state-owned enterprise) with only one director:
i. director may exercise any power/perform any function of the board at any time except when the MOI
provides otherwise.
3. A company (other than a state-owned enterprise) where every shareholder is also a director:
i. Shareholders may decide on any matter to be referred by the board at any time, without notice or
compliance with any internal formalities except when the Memorandum provides otherwise; subject to
certain specified conditions
1.12 Shareholder resolutions
CA provides 2 types of resolutions:
1. Ordinary resolution
i. Requires 50% or more of the voting rights exercised on the resolution
ii. MOI may require a higher percentage
2. Special resolution
i. Requires 75% or more of the voting rights exercised on the resolution
ii. MOI may require a lower percentage
Downloaded by Enos ()
