Requisition by a shareholder for a general meeting

This is a device that members can use to force the company to hold a general meeting in order to discuss a particular resolution(s) that the members want to debate and vote on.  It can also be used to get rid of an errant director.

Important information

Having given the company special notice (at least 28 days) that you want a particular director removed, you may now possibly have to ask the board of directors to call a general meeting where your resolution can be heard and voted on by your fellow members. Without doing this, even though the directors have received special notice, they’re under no obligation to hold a general meeting. This request even overrides anything in the company’s articles to the contrary.  The directors must now call a general meeting once the company has received your request (provided you’ve been able to muster up at least 5% of the voting rights). It’s therefore important to check your figures before you proceed not only to ensure you’re eligible to compel the company to set up a general meeting but also to ensure that you have the necessary number of votes needed to get your resolution passed at the general meeting. This will depend on the type of resolution you’re looking to pass. For example, a general resolution is needed to remove a director, and this requires over 50% of the votes. On the other hand, a special resolution, i.e. to alter the company’s articles, will require 75% of the votes in favour. 

Make sure your requisition is clearly stated, signed and dated by a sufficient number of members entitled to vote to carry you over the 5% threshold. Also ensure your requisition states the resolution you’re looking to vote on at the general meeting.

You can submit your requisition to the board in either hard copy or electronic form. Whichever method you choose, make sure it is received and acknowledged and is sent to the company’s registered office.

Once your requisition is received by the company, the directors should proceed to convene the general meeting within 21 days of the date of your requisition.  If the company ignores your request, you can then convene the meeting (if you’re the person making the requisition).

Note.  Removing directors is one of the few things these days that still requires a physical meeting. This is because you are not allowed to use the written resolution procedure to do this.