Meetings of Shareholders

Meetings of Shareholders

Meetings of Shareholders:

Every company must hold at least one shareholders meeting every year (annual meeting).  In addition to the annual meeting, a company may hold other meetings of shareholders to vote on specific issues (special meetings). On basis of participation of shareholders and objectives, meetings are categorized into the following four types:

Statutory Meeting: The first meeting of the shareholders of a public limited company is known as statutory meeting. Every public limited company must arrange the statutory meeting within a period of not less than one month and not more than six months from the date on which the company becomes entitled to commence business. This meeting is held once in the lifetime of a company. The objective of statutory meeting is to inform the shareholders about all aspects of the company since its incorporation. Notice of such meeting is to be given at least 21 days before the meeting. Private limited company does not require holding such meeting.

Annual General Meeting / Ordinary Meeting: An annual general meeting refers to the meeting of a company which is held annually. It is also called ordinary meeting. The first annual general meeting is held within 18 months from the date of its incorporation and thereafter once in every accounting year. The time gap between two consecutive annual general meetings must not exceed fifteen months. The annual general meeting (AGM) is regarded as the most important of all company meetings. It is the primary avenue for companies to communicate with their shareholders. The articles may provide that such meeting shall be held on a certain date in every year.

Extra Ordinary Meeting: All meetings of the shareholders other than the annual general meetings and statutory meetings are known as extraordinary general meetings. These meetings are called in emergencies or special occasions. They are called when it is found necessary to transact certain business that cannot be kept unsettled until the next general meeting. An extra ordinary meeting is usually called for such purposes as alteration of the memorandum and articles of the company, increase or decrease of share capital etc.

Class Meeting: Class meetings are meetings of the particular class at shareholders like preference shareholders. Class meeting are generally held for obtaining the consent of a particular class of shareholders for altering their rights and privileges or conversion of one class into another.