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Are you using the proper procedures for calling shareholders' meetings?

by , 15 November 2013
The Companies Act gives shareholders certain rights, like the right to vote in shareholders meetings. But it also dictates the correct procedure for calling a shareholders' meeting. And if you don't follow the correct procedure, you could face fines of up to R1 million!

The experts at the Practical Accountancy Loose Leaf explain exactly what you have to do the next time you call a shareholder meeting.
 
 
Follow this procedure to call a shareholders' meeting:
 
1.       If you're a public company, distribute a writtennotice to the shareholders at least 15 working daysbefore the proposed meeting date.
 
This written notice must include the:
• Date, time, place and purpose of the meeting; and
• A copy of any proposed resolutions.
 
The Memorandum of Incorporation (MOI) may extend this period.
 
If all the company's shareholders agree, you can waivethe notice period.
 
2. If you're a state-owned company, a private company, a limited liability company or a non-profitcompany, you must distribute a written notice to shareholders at least ten working days before theproposed meeting date.
 
This written notice must include the:
• Date, time, place and purpose of the meeting; and
• A copy of any proposed resolutions.
 
3. If a company only has one shareholder, you don'tneed any notice.

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