What are Company Meetings?
From the perspective of the law, a corporation is regarded as a separate legal entity from its members. The board of directors essentially runs the whole business of the corporation. The company’s board of directors manages these issues within the parameters of the authority granted to them by the company’s articles of organization. With the approval of the other company members, the directors can also exercise some of their own rights.
At the company’s general meetings, the approval of the other members is guaranteed. At the company’s meetings, the shareholders—who are also thought of as the company’s owners—cancel any errors made by the board.
What are the different types of Company Meetings?
Company Meetings are required for a variety of purposes. Let’s look at the different kinds of these meetings:
- Statutory Meeting.
- Annual General Meeting.
- Extraordinary General Meeting.
- Class Meeting.
- Meeting of Debenture Holders.
- Meeting of the Board of Directors.
- Meeting of Creditors.
- Meeting of Creditors and Contributories.
A. Statutory Meeting
Every public company limited by shares and every company limited by guarantee with share capital are required to hold a general meeting of the members, known as the Statutory Meeting, within a window of not less than one month and not more than three months from the date at which the company is entitled to begin operations. Once during the existence of a firm, this meeting is held.
The directors’ statutory report, which provides information on the company’s establishment, will be the topic of discussion at this meeting of the members.
This meeting is not required to be held by private businesses.
B. Annual General Meeting
A company’s general meeting is a gathering of its members for certain reasons. Public firms are required to have their annual general meetings during the first six months of their fiscal year, if not earlier. Unless they are a traded business (a corporation whose shareholders have a claim to some of the firm’s assets and revenues) or its bylaws mandate it, private corporations are not compelled to have an annual general meeting.
Every firm is required to have an AGM each year in addition to any other meetings. The meeting notice must make it clear that it is an AGM notification. Every AGM shall be held on a working day and within normal business hours.
C. Extraordinary General Meeting
Extraordinary general meetings (EGMs) are any general meetings of the corporation that are neither AGMs nor statutory meetings.
Extraordinary meetings may be called by the directors whenever they see fit or upon the request of the company’s shareholders.
Directors may call meetings as they see fit by resolution adopted during a board meeting that has been properly called and called to order. Keep in mind that any business conducted at an extraordinary meeting will be treated as exceptional.
D. Class Meeting
A certain class of shareholders hosts these meetings. This meeting’s goal is to modify the Articles to change one class into another or to modify their rights and privileges.
The Memorandum or Articles must provide the provision for change. However, the terms of issuance of shares of that particular class shall not forbid this change. Such motions must get a three-fourths vote of the class to succeed.
E. Meeting of debenture holders
According to the terms of the trust deed or debenture bond, these meetings are called (Rules printed on the reverse of the debenture certificates issued by the company). These meetings are occasionally called when the interests of debenture holders are at stake during a firm reorganization, reconstruction, merger, or wind-up. The trust deed contains the regulations governing the appointment of the chairman, notice of the meeting, quorum, etc.
F. Meeting of the Board of Directors
The board of directors may hold an extraordinary general meeting of the corporation if certain important business needs the consent of the members. The board of directors of a business may hold an extraordinary general meeting anytime they see fit, in line with the firm’s articles of organization.
As is the case with all of the director’s powers, the authority to call an extraordinary general meeting must be used during a board of directors meeting.
G. Meeting of creditors
When the business suggests making a plan of arrangement with its creditors, these meetings are convened. In the event of a corporation being wound up, the firm or liquidator may request that the court order a meeting of creditors or a class of creditors.
The court may order how such a meeting is organized and handled. All creditors must abide by the terms of the agreement if it is approved by a three-fourths majority of the total amount of the creditors and is upheld by the court.
H. Meetings of creditors and contributors
When a business enters liquidation, these meetings are convened to determine the total amount owed by the firm to its creditors. These meetings’ primary goal is to win the support of the company’s creditors and contributors to the compromise or restructuring plan that would save the business from financial troubles. The court may occasionally mandate the holding of such a meeting.
Meetings that are called to change the rights of debenture holders must follow the procedures outlined in the debenture trust deed. They are also kept on hand to give the corporation the ability to issue additional debentures or change the interest rate that is due to debenture holders.