Resolutions requiring special notice

The companies Act 1994, provides that where by any provisions contained in the Act or in the Articles of Association, special notice is required of any resolution, notice of the intention to move the resolution shall be given to the company not less than 14 days before the meeting at which it is to be moved. The companies, Act adds that the Company shall, immediately after the notice of intention to move any such resolution has been received by it, give the members notice of the resolution in the same manner as it gives notice of the meeting either by advertisement in a newspaper having an appropriate circulation or in any other mode allowed by the Articles not less than 7 days before the meeting the following are the , requiring such special notice as per the companies Act, 1994.

1) Resolution that the retiring auditors shall not be reappointed.

2) Resolution of the appointment of an auditor other than the retiring auditor.

3) Removal of a Director before the expiry of his term.

4) Appointment of another person a director in place of the director removed.

Resolutions of Company Meetings

Ordinary Resolution: Section 81 of the Companies Act, 1994 provides that a resolution shall be an ordinary resolution when at a  general meeting , of which the notice required under this Act has been duly given , the votes cast in favor of the resolution by members exceeds the votes cast against the resolution. The ordinary resolution is commonly used for ordinary business transacted in the general meeting such as , declaration of dividends, appointment of auditor, adoption of annual accounts, election of directors, issue of shares at discount, appointment of secretary etc.

Certain items of special business also require ordinary resolutions under the companies Act 1994

i) Issue of shares at a discount

ii) Alteration of the share capital.

iii) Appointment of Branch Auditor.

iv)  Increasing or reducing the number of directors with the limits fixed by the Articles.

v)  Approval to the Board of Directors for exercising any of the powers.

vi)  Appointment of the sole selling Agent.

vii) Remuneration payable to the directors.

viii) Investment in any other body corporate.

ix) Voluntary winding up in specified circumstances.

Special Resolution: Section 87 of the Companies Act 1994 provides that a resolution shall be a special resolution when ----

a) The intention to propose the resolution as a special resolution has been duly specified in the notice calling the General Meeting or other intimation has been given to the members of the resolution;

b) The notice required under this Act, has been duly given for the General Meeting and

c) The votes cast in favor of the resolution by the members in person or by proxy are not less than three times the number of votes, if any, cast against the resolution. The Articles of Association may also provide that certain types of business shall be approved by a special resolution. Generally, in the following cases, special resolution is required------

1) Change of the registered office from one state to another and change of object clause of memorandum of Association.

2) Change of the name clause of the a Memorandum of Association.

3) Alteration in the Articles of Association.

4) Creation o Reserve Capital.

5) Removal of registered office from one place to another place in the same state.

6) Reduction of Capital

7) Payment of interest out of capital to the shareholders.

8) Appointment of inspectors to investigate company’s affairs.

9) Fixation of Directors remuneration, if the Articles provides so and sanctioning of remuneration to a director on the basis of percentage of profit.

10) Permission to director to hold an office of profit under the company.

11) For making the liability of directors unlimited.

12) Making loans to other companies under the same management.

13) Voluntary liquidation of a Company.

Types of Resolution

In accordance with the company Act.1994 enforceable in Bangladesh, resolution of a meeting can be divided in to three groups. They are ordinary resolution, Special resolution and Extra ordinary resolution. They are discuss detailed as follows-----

1) Ordinary Resolution: A resolution which is simply passed by the majority votes not less than three fourths cast by the members in person or by proxy is known as ordinary resolution. The businesses of ordinary nature are recorded in such resolution.

2) Special Resolution: A special resolution is that which recently the decision of the meeting transacting some special business and which is passed by the majority of the members ( not less than three fourths)

3) Extra Ordinary Resolution: The Resolution which is passed in a meeting at the consent of three fourth of the participating members with a view to serving emergency purposes is called extra ordinary resolution. The members must be communicated through notice before 14 days of holding meeting to adopt such resolution and the extra ordinary must be submitted to the register of the company within 15 days of adopting such resolution in the meeting.

Extra – ordinary resolution is necessitated to be passed for the following causer

i)  Winding up of company at will.

ii) Dismissal of any director,

iii) Dismissal of management agent etc.

Requisition of Resolutions

They are ordinary resolution special resolution and extra ordinary resolution. The requirements of a good resolution are-------

1) It should be in writing in a separate book called Minute Book.

2) The language of the resolution should be lucid, easy and précis and convey the desired meaning.

3) The subject matter of the resolution should be as it was recorded in the meeting. Any distortion of facts and figures should be avoided.

4) The resolution may be formal or informal

5) A resolution cannot be changed unless a further resolution in passed.

6) A resolution cannot be changed unless a further resolution in passed unless a motion is formally moved, discussed and put to vote.

7) It should be affirmative in form.

8) It should begin with the words “Resolved That”

9) The first part of the resolution should explain the background of the resolution.

10) The main part of the resolution should state the decision of the meeting.

Definition of Resolutions

A resolution is the decision of the meeting. A motion becomes resolution when it is voted upon and the majority of members pass it with or without amendment. A resolution once adopted and recorded in the Minutes Book becomes the official decision of the meeting . The resolution must be written in a specialized style with unambiguous words in the Minute Book.

Proceedings of a Meeting

Proceedings mean the verbatim record for report or the discussions and decision of a meeting. It is the detailed record to matters raised at the meeting the discussions held on each motion and the decisions reached on each item.

Minutes of Company Meetings

Minute is the precise and accurate official record of the decisions taken at the company meetings. It only records the   resolutions taken by the members in the company meetings. Minutes also records the facts and circumstances behind the passing of a resolution. So it is also known as Minutes of Narration. Generally minutes are written from the notes taken by the chairman and secretary from the proceedings of the meeting and it is drafted in such a clear and lucid language so that ambiguity can be avoided and it represents each item separately. The contents of the minute’s are------

1)  The nature of the meeting should be specifically stated.

2) The date, time and place of the meeting.

3) The names of the chairman and secretary

4) The names of the Directors and other members present at the meeting.

5) All the resolutions passed in the meeting.

6) The minutes need not include any matter, which in the opinion of the chairman, is or may be considered defamatory or irrelevant or immaterial or detrimental to the interest of the company.

7) Each page of the minute book must be initialed by the chairman and last page of the book must be signed by the chair man of the meeting with date.

Authentications of Minutes

The proceedings of the meeting and the minutes of the meeting are  placed before the next meeting for confirmation. It is known as authentication of minutes. The secretary reads out the minutes of the last meeting and when it is accepted by the meeting as to its correctness, it is minute is not approved, a fresh resolution should be adopted.

Principles of Writing Minutes

The following principles are followed for writing Minutes----

1) It should be clear, concise and accurate and free from ambiguity.

2) It should be written by dividing the matters into suitable paragraph.

3) Each paragraph should be written with a brief heading for quick reference .

4) It should include the correct and fair summary of the proceedings of the meeting.

5) It should state the name of the meeting with date, time and place.

6) It should mention the name of the chairman and other important persons attended the meeting.

7) It should state the name of the proposer, secondary method of voting, voting result and the resolutions of the meeting.

8) It should state separately the financial and other special terms discussed in the meeting.

9) It must be  recorded in the Minutes book.

10) Explanatory notes should be given for special issues at the foot-note of the minutes.

11) The minutes must be signed by the chairman with date and confirmed in the next meeting by the members.

Classification of Minutes

Minutes may be of two types via Minutes of Decision and Minutes of Narration

a)  Minutes of Decision: It means the recording of the resolutions taken in the meeting . In this method , only the final decisions adopted in the meeting is recorded in brief.

b) Minutes of Narration: It means the recording of proceedings of the meeting in detail for some of the discussions and happenings. In this method , the minutes is written in a narrative  style about the discussions and the resolutions adopted on the discussions.

Objectives /Purposes/Importance of Minutes

Minute is prepared so that the motion and resolutions taken in a meeting can be used as reference in future. The preparation of minutes serves the following purposes.

a)  It preserves a clear, concise and accurate record of the business transacted in the meeting.

b) It serves as a permanent record of the actions of the members and decisions taken in the meeting.

c) It serves as a legal document when it is confirmed by the next meetings and signed by the chairman.

d) It helps as the guidelines of the organizational activities of any concur.

e) It serves as reminder of the subject matter dealt with in the previous meetings.

f) It is the official records of proceeding and decision of the meeting.

Definition of Minutes

Minutes is the official recording of the proceedings of the meetings and the decisions reached there in. minutes is a full but concise clear, lucid, true and accurate record of the business transacted at the meeting and the decisions and resolutions adopted there at . It is prepared after the meeting from the notes taken during the proceedings of the meeting. The recording of minutes and maintenance of proper minutes of meetings is obligatory for public bodies or co-operative societies. The object of preparation of the minutes is to preserve the business transacted in the meeting and decision taken on the discussion in a clear, concise and accurate way for future guidance.

Minutes and Resolution

Minute is a brief but a complete record of all motions and resolutions that are taken based on discussion held among the members in a meeting.

Circular

Circular is a written notification conveying some material information to different interested Parties. Circular conveys information regarding any product, policy change of address. Opening or shifting of a showroom or branch, change of representatives etc . Circular is the notification or conveyance of some information to the customers, employees, departments, public or interested parties.

Agenda of a Company Meeting

Agenda means things to be done. It implies that agenda is a list of business to be transacted in a meeting. It ensures systematic discussion of the items in order of their importance as it appears in the agenda and it also states the sequence of the items of discussion. Generally, agenda is an informative letter containing all matters of genuine interest of the members of the company. Agenda is accompanied with the notice of the meeting .The agenda is generally prepared by the secretary in consultation with the chairman or directors.

The procedure for the preparation of agenda may be stated as under---

1) Agenda should be a clear and explicit summary of the items to be discussed in the meeting . Ambiguous words should be avoided.

2) The items of agenda must be stated with subject heading and adequate blank space should be left such as---

a) Confirmation of the minutes of the last meeting held on --- to be read and confirmed

b) Secretary’s Annual Report to be read and approved, being moved by and seconded by-----

c) Appointment of Auditor.

d) Filling up casual vacancy.

e) Company’s Investments.

3) Routine matters should be placed first and controversial items later.

4) Agenda should be written on the left hand side of loose foolscap paper with a wide margin on the right hand side for record of necessary notes.

5) Agenda may be typed on a separate sheet of paper and attached to the notice sometimes the detailed agenda is written in an Agenda Book providing space for making notices.

6) It should be written within the scope of the meeting.

Secretary’s Duties Regarding Notice

The company secretary has to perform the following duties regarding notice of the company meeting-

1)  He must mention the date, time and place of the meeting in the notice.

2) he should get the notice printed.

3) he must serve the notice before reasonable time to all the members at their registered address in case of the meeting og the shareholders or to all the directors in case of Board Meeting.

4) he must attach all enclosures with the notice .

5) he should read out the notice in the meeting.

Requisites of Notice of a company Meeting

The Following are the requisites of a notice  of company meeting –

1) Company Act 1994 provides that every notice of the company meeting shall specify the place, date and time of the meeting.

2) The notice must be accompanied by the agenda which contains the business to be transacted in the meeting;

3) Every notice must be given to –

a) Every member of the company entitled to receive such notice;

b) Every legal representative of deceased member or insolvent members;

c) Auditor of the company.

4) Notice of every Annual General meeting must be given in writing to every shareholder, director and auditor before 21 clears before 21 clears days of the meeting and must be accompanied by relevant documents viz annual report of directors , annual accounts , auditor’s report, proxy forms etc.

5) Notice of the Statutory meeting must be accompanied by a statutory Report and 21 clear days notice should be served.

6) Notice of Extra – ordinary General meeting must be accompanied by an Explanatory statement.

7) Notice of every Board meeting must be given in waiting to every director who is present in before 21 clear days of the meeting.

8) In case of meetings other than Statutory , Annual General and Extra ordinary meetings and Board meeting. 14 clear days notice is necessary.

9) The notice must specify that a member is entitled to appoint prosy , if it is  allowed by articles  of Association and a proxy need not be a  member.

10) Notice should be served either through messenger or by post or by advertisement in the newspaper.

11) If notice of a meeting is given by advertising in the newspaper . It should be mentioned in the advertisement that the statements have been sent to the members of the company , such notice by advertisement shall be deemed to be duly served. On the day on which the advertisement appears in the newspaper, on every member of the company who has no registered address in Bangladesh.

12) No notice is generally required for adjourned meeting .

13) No notice is required in case of a committee  meeting , if the members agreed so.

14) Shorter notice may be served if it is agreed by-

a) members holding not less than 95% of the paid up capital of the company and entitled to vote at the meeting or

b) members holding not less than 85% of the total voting powers at the meeting

Definition Agenda of Meeting

Agenda means things to be done in the meeting. It is a predetermined program of the business to be transacted in the meeting . It is a systematic record of the items of business in their proper order of importance. In preparing agenda, the routine items of business in their proper order of importance . In preparing agenda, the routine items are place first and then controversial matters are placed . It is generally served with the notice of the meeting . Agenda should be written in clear and explicit language avoiding ambiguous words. Agenda is prepared before the meeting takes place with a view to avoiding omission of any important business in any meeting. The agenda is prepared by the secretary in any important business in any meeting. The agenda is prepared by the secretary in consultation with the chairman or senior executive of the organization. Generally agenda are written at the bottom of the notice. Sometimes , agenda are given in a separate sheet which is enclosed with the notice. All items in the agenda are serially written in order of importance and sometimes with notes under each item . The agenda items must be within the scope of the meeting and not in violation of the rules, regulations and buy-laws of the organization sometimes, agenda are written in an Agenda Book for the use of the Chairman.

Meetings without Serving Notice

Generally, meetings are held after serving a notice. But there are certain situation where notice is not required to hold a meeting. Normally under the following circumstances, the service of notice is not obligatory-

1) Where a member is living abroad or where his presence are not known.

2) Where meetings are held on a fixed day of each month or week. Here notice may be reduced to mere reminder or ignore with completely.

3) Where the Articles of Association of the company fix the dates on which the Board meetings are to be held.

Requisites of Valid Notice

All meetings cannot  be termed as a valid meeting .The meeting which is legally concerned with the interact of the company is a valid meeting . The essentials of a valid notice may be stated as follows-

1) The notice must state the date , time and place of meeting.

2) The notice must state the nature of the business to be transacted in the meeting . In other words , the notice must contain the Agenda for the meeting.

3) Proper length of the notice should be given as provided by the rules for different meetings .

4) The notice must be served in the manner provided under the rules.

5) The notice must be served to the person entitled to receive it.

6) The notice must be signed and dated by the person authorized to do so.

7) Issue of proper notice is obligatory.

8) The notice must be clear , explicit and unconditional.

Definition Notice of Meeting

Before defining of notice, definition of meeting should be necessary. A meeting is a mutual discussion where two or more persons gather or assemble themselves with intention of decision-making. Notice is an intimation or invitation in writing to persons who are entitled to participate in a meeting. It implies the formal intimation to the members who are eligible to attended and vote in the meeting. It implies the formal intimation to the members who are eligible to attend and vote in the meeting. A meeting cannot be held without a valid notice.