How to handle AGM resolutions

PD writes: I am the company secretary of a private company and have sent notice of a special resolution to shareholders. Nine working days before the company’s annual general meeting (AGM) when the resolution will be considered, I received a proposed amendment to the resolution. Are we obliged to put the amendment to the meeting?

The board is not aware if the amendment has much support, but if it does, how can those shareholders force such an amendment?

An amendment to a resolution should usually be treated as a new resolution, and can only be requested under certain circumstances, writes Jon Sutcliffe, partner at Kingston Smith LLP. You should first check the articles of the company to see if there are any special provisions affecting how a member may request a resolution. Assuming your company does not have any bespoke provisions the Companies Act provides the relevant guidance.

The Companies Act places a duty on companies to circulate resolutions proposed by shareholders and intended to be moved at an AGM if a certain number of members request it. The resolution may be circulated at the expense of the members making the request, unless the company chooses to bear the cost.

The number of members needed must either together make up 5% of the voting power of the company or 100 or more shareholders whose paid-up capital averages at least £100 each. If the proposed amendment has not been forwarded by sufficient members to meet either of the criteria, then there is no obligation to consider the amendment.

Finally the request must be received by the company at least one week before the meeting to which it relates.