Study unit 1 - LML with verified questions and answers

What is the record date? The record date is the day used to determine who will receive the distribution. the date that must be set by the board of directors of a company for the purposes of determining who is entitled to receive notice of a shareholders' meeting, to participate in and vote at a meeting, decide matters by written consent or electronic communication, exercise pre-emptive rights, receive distributions and to be allotted or exercise other rights Why and how are meetings convened? Notice convening a meeting must be given to all persons who are entitled to receive a notice of the meeting. A meeting must be convened at a time, date and place, which is accessible to the members of a company. A quorum must be present, this is the minimum number of members who have to be present at the meeting before the meeting can commence. What is representation by proxy? Section 58 A proxy is a person who is appointed to represent a shareholder at a meeting. - Companies Act changes common law by allowing shareholder to appoint any individual as proxy (doesn't have to be member) - provisions of MOI may allow a shareholder to appoint two or more proxies - appointment must be in writing and signed by shareholder - remains valid for one year after it was signed - may also appoint proxy for specific time specified in appointment form - proxy may delegate authority to act to another person - proxy appointment form must be delivered to company prior to proxy exercising any rights at a shareholders' meeting - company can't compel shareholder to make irrevocable proxy appointment - appointment of proxy automatically suspended where the shareholder acts directly on a particular matter - shareholder can revoke appointment by cancelling it in writing, or making a later inconsistent appointment of a proxy and delivery a copy of the revocation instrument to the proxy and the company - at the meeting proxy is entitled to vote as he or she thinks fit, unless shareholder has indicated on proxy appointment form whether the proxy should vote in favour of or against a particular resolution - company could invite shareholders on proxy appointment form to appoint proxy from list of names provided by company but can't compel shareholders to choose one or more persons from the list Which decisions require a special resolution? - amendment of MOI - approving voluntary winding-up - approval of a sale of assets, a merger, an amalgamation or a scheme of arrangement - approval of directors' remuneration - when required by MOI