Explanation of Resolution

Introduction
Resolutions in Writing
Directors' Resolutions
Members' Resolutions
Requirements of special resolution
Examples where special resolution is required
Resolutions Requiring Special Notice
Annual General Meeting - (AGM)
Extraordinary General meeting (EGM)
Specimen Resolutions

Introduction

A resolution is a decision or an expression of opinion or intention by a meeting . The term is also used to refer to a proposal to be submitted to a meeting. A resolution which has been recorded in the minute book is often referred to as a "minute".

Normally, resolutions of members and of directors are passed at formal general meetings of members and formal board meetings respectively. However, it is possible for some members' resolutions and nearly all directors' resolutions to be passed without any actual meeting of members or directors as the case may be. These possibilities occur where the articles of associations of the company provide:

for voting on a resolution by postal ballot;
that a resolution in writing signed by all the members (or directors, as the case may be) shall be as effective as a resolution passed at a meeting of members (or directors) duly convened and held.

Resolutions in Writing

It is now quite common for articles of association to provide that directors' resolutions may be passed without a meeting and the following is the normal form of article:

A resolution in writing signed by all the directors for the time being entitled to receive article of a meeting of the directors, shall be as valid and effectual as if it had been passed at a meeting of the directors duly convened and held. Any such resolution may consist of several documents in like form each signed by one or more directors.

Written resolutions can be passed via electronic channels e.g. email, in stead of via hard copies.

The following is a form of resolution in writing:-

ABC PTE LTD
(Incorporated in Singapore)

DIRECTORS' RESOLUTIONS IN WRITING PURSUANT TO THE COMPANY'S ARTICLES OF ASSOCIATION

We, the undersigned, being all the directors of the Company, do hereby pass the following resolutions-

RESOLVED-

BUILDING AGREEMENT FOR LAND

1) That the Company be authorised to enter into a Building Agreement (the "Agreement") for Land at private lot [ ] with AAA Corporation

2) That any directors be authorised to sign the Agreement and all other documents for and on behalf of the Company.

3) That the common seal of the Company be affixed onto all the relevant documents relating to the above matter in accordance with with the Company's articles of association.

Dated this 2 January 20XX

Signed as a correct record

__________________ _________________
LEE LAI LAI TAN YI YI

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Directors' Resolutions

Director's resolutions generally require a simple majority of votes to secure their adoption.

Members' Resolutions

Resolutions of members are of two kinds, namely:-

Ordinary
Special
Ordinary Resolution

An ordinary resolution is one passed by a simple majority of those voting on a show of hands or a poll. It is effective for the transaction of all items of business except those for which a special resolution (or a resolution with special majority) is required by the Companies Act or the articles. The majority referred to is a majority of those voting and not a majority of those attending the meeting. Those who attend the meeting but abstain from voting are not counted.

Apart from special resolutions, the Act provides that a special majority, of not less than three-fourths of such members of the company as being entitled to do so vote in person or where proxies are allowed by proxy, is necessary to pass the following resolutions:
- For the appointment of a person of or over the age of seventy years as a director of a public company or subsidiary of a public company..
- For the appointment of an auditor to fill a vacancy caused by the removal of an auditor where the filling of such vacancy is effected at the meeting at which the removal took place.
Special Resolutions

A resolution is a special resolution when it has been passed by a majority of not less than three-fourths of such members as, being entitled so to do, vote in person, or where proxies are allowed, by proxy at a general meeting of which not less than twenty-one days' notice, specifying the intention to propose the resolution as a special resolution.

Requirements of special resolution:

Fourteen days' notice, this will allow private companies to make decisions more quickly and enable special resolutions to be passed faster at general meetings.
The notice must specify the intention to propose the resolution as a special resolution
The three-fourths majority which is required. This majority is three-fourths of those who attend and vote in person (or proxy where so allowed); it is not simply a majority of three-fourths of those attending the meeting; those who attend but do not vote on the resolution are not counted.

Examples where special resolution is required:

Where the articles require a special resolution
Alteration to clauses in articles/memorandum
Change of name
Omission of "Limited"
Conversion of unlimited company to limited company
Alteration of objects
Reduction of capital
Appointment of inspectors on application by the company
Voluntary winding-up
Sanction of arrangement between a company and creditors
Transfer of property by liquidator

Resolutions Requiring Special Notice

In addition to providing that certain decisions must be made by special resolution the Companies Act stipulates that special notice must be given of the following resolutions :

to remove an auditor from office
to remove a director from office or to appoint some person in place of a director so removed at the meeting at which he is removed.

The resolution shall not be effective unless notice of the intentions to move it has been given to the company not less than twenty-eight days before the meeting at which it is moved, and the company shall give its members notice of any such resolution at the same time and in the same manner as it gives notice of the meeting or, if that is not practicable, shall give them notice thereof , in any manner allowed by the articles, not less than fourteen days before the meeting.

Annual General Meeting - (AGM)

Every company must hold a general meeting in each calendar year as its annual general meeting and not more than fifteen months must elapse between the date of one annual general meeting and the next. However the first annual general meeting may be held within eighteen months of incorporation . Any competent business may be transacted at the AGM.

Extraordinary General meeting (EGM)

An extraordinary general meeting may be convened at any time for the transaction of special business which requires attention before the next annual general meeting. The only business which may be transacted at an extraordinary general meeting will be the special business set out in the notice convening the meeting.

The directors are the convening authority for an extraordinary general meeting. However members holding not less than one-tenth of the paid-up capital carrying voting rights may at any time lodge a requisition requiring the directors to convene an extraordinary general meeting for the purposes stated in the requisition.

Notice of Meetings

The minimum periods of notice provided by the Companies Act cannot be further restricted by the articles, but they may be extended. The periods of notice are usually 14 days. Agreements to short notice will only be effective if members present have given their consent and agreed to accept short notice.

Specimen Resolutions

We have assembled some specimen resolutions which we hope will provide and facilitate the drafting of resolutions passed ( or to be passed) at board meetings and general meetings of companies.

There is probably no finite number of different kinds of resolutions that may be decided but it is hoped that those produce by us will provide a useful all-round coverage which will assist those who have the responsibility of recording or advising on them.

It must be emphasized that although certain of the resolutions may be adopted in their entirety, others could only be used as guides to be varied where necessary to conform to the particular sets of facts and circumstances.

If you require any clarification or assistance in drafting company resolutions, kindly contact us 6533 7393or click here