Any meeting of the members of a limited company in Ireland other than the Annual General Meeting is deemed to be an Extraordinary General Meeting (EGM).
Subject to the Constitution of the Company, an EGM may be convened at any time to transact business which needs to be dealt with.Examples of why a Company may convene an EGM include business such as granting authority to the directors to allot shares, approving an increase in authorised share capital, or removing a director.
Convening the EGM
In Ireland, the directors of the company will usually arrange and convene an EGM to deal with particular business when required. The Court also has the power to convene an EGM, and subject to the Constitution, members holding more than 50% of the paid up share capital of the company and who carry the right of voting at general meetings of the company, may convene an EGM.
It is possible for the members of a company to require the directors to convene an EGM. Section 178 of the Companies Act 2014 provides that members holding not less than 10% of the paid up share capital of the company either individually or collectively can requisition the directors to hold an EGM.
The Rules Regarding a Requisition in Ireland
In order for the requisition to be valid certain conditions must be followed:-
- The requisition must state the objects of the meeting
- The requisition must be signed by all of the requisitionists and
- The requisition must be deposited at the registered office of the company.
Although the requisition must be signed by all of the requisitionists, they do not all need to sign the one page. The requisition may be delivered in several counterparts.
The Directors’ Role Following Requisition
Within 21 days of the date of deposit of the requisition, the directors should convene the EGM to be held within 2 months after the requisition date.
The directors have a duty to notify all members, their representatives, all directors and the secretary of the company. It should also be noted that the auditors, if any, have the right to receive notice and if they so choose, to attend the meeting. Notice may be longer if so stated in the Constitution of the company, however it should not be shorter than 7 days. Subject to the Constitution of the Company, consent to short notice may be granted by the members and auditors of the Company.
Failure to Convene the EGM
If the directors fail to convene the EGM, the requisitionists, or any representing more than 50% of the total voting rights of all, may then convene a meeting themselves. However, they must hold the meeting within 3 months of the requisition date.
In cases where the directors have failed to convene the EGM, any reasonable expenses incurred by the requisitionists shall be repaid to the requisitionists by the Company.
As with most Company transactions, it is advisable that members and directors carefully review the Constitution and seek professional advice when arranging or convening extraordinary general meetings in Ireland.