Definition of an EGM
An extraordinary general meeting, also known as an EGM, is a meeting that is held among the official body of the members of an organization, shareholders of a company, or employees. EGMs occur at irregular times. The members and shareholders must be informed of the purpose of the extraordinary general meeting so that they will be able to attend the meeting in a position and situation where they can deliberate and exercise intelligent judgment so that none of the resolution to be passed are rendered invalid. Before the extraordinary general meeting takes place, the board of the organization will have agreed on more than one resolution that will be put to consideration before approval at the EGM. The wording of the decision is sent to the shareholders and members with a note about its importance. The reason for this is that the board is known to have a better knowledge about the situation, and the resolution is in effect for the ideal solution although it might not be the interests of shareholders and members. Usually, during an extraordinary general meeting, the chair person of the EGM reads out the resolution and recommends the resolution to those who are present in the meeting approval.The chairperson also takes questions about the decision, supervises the vote from those present, and declares the result of the vote. The rules for conductiong an extraordinary general meeting and the options involved in altering a resolution at an EGM as well as taking votes from proxies will vary depending on the type of orgranization. An extraordinary general meeting is called to handle matters having to do with the administration of a company’s affairs and requires the consent of the members involved.
In many cases, the only times that the executives and the shareholders can meet is during the company’s annual general meeting, which usually takes place at a fixed date and time. However, some situations might require shareholders and member of the board of directors to meet on short notice to deal with an urgent matter that usually concerns the management of the company. The extraordinary general meeting is an avenue to meet and deal with crucial and critical issues that arise in between or during the annual general meetings.
An EGM is called to deal with any of the following:
- The removal of an executive
- A legal matter
- Any matter that cannot be sustained until the next shareholders’ meeting
Extraordinary general meetings can take place on any day, including public holidays, or at any time. Extraordinary general meetings are called either by the board of directors, members, or even the court on rare occasions. Whenever it is impossible for the company to allow a major issue to go unmentioned until the next AGM to be held, the Articles of Association of the company provide an avenue for holding general meetings other that AGMs for the discussion of special business matters. Such meetings are know as extraordinary general meetings. An extraordinary general meeting of the company takes place whenever the board considers such a measure to be suitable. In a private company in Singapore, the minimum notice period for EGMs related to all resolution is 14 days. The same is true of public companies and EGMs related to ordinary resolution; however, EGMs in public companies which are related to special resolutions have a minimum notice period fo 21 days.
Regardless of when the company is to hold an EGM, many people nevertheless choose to start a company in Singapore. If such is your intent, we at Paul Hype Page & Co can be of assistance to you. We will work with you throughout the process of incorporation so that you will best understand how to set up your own Singapore company.