Jul 1, 2016

Magnus Amudi: Shareholders Resolutions: Matters Requiring Special Resolutions

Under the Companies and Allied Matters Act, Chapter C20, Laws of the Federation of Nigeria, 2004 (CAMA) a resolution may be passed as ordinary or special resolution. An ordinary resolution is one passed by at least 50% of the votes plus one while a special resolution is one passed by at least 75% of the votes. The CAMA provides that a company may, by its articles, provide that any matter not required by the articles or by the CAMA to be passed by a special resolution shall be passed by ordinary resolution. As such, all matters can be passed by ordinary resolutions except the following:

1.     Alteration of the memorandum of association (section 46(1) CAMA).

2.     Alteration of articles of association (section 48(1) CAMA).

3.     Changing the name of the company (section 31(3) CAMA).

4.     Reduction in authorized share capital (section 106 (1) CAMA).

5.     Making liability of directors unlimited (section 289 CAMA).

6.     Resolution that the company be wound up by the court (section 408(a) CAMA).

7.     Resolution that the company be wound up voluntarily (section 457(b) CAMA).

8.     Authorizing the liquidator on the sale of undertaking of company to receive shares, policies, or similar interests as consideration for distribution among members (section 538 CAMA).

9.     Re-registration of unlimited company as company limited by shares (section 52(1) CAMA).

10.  Re-registration of a company limited by shares as unlimited company (section 51(5) and 46(1) CAMA).

11.  Re-registration of private company as public company (section 50(1) CAMA).

12.Re-registration of public company as a private company (section 53(1) CAMA).

13.A resolution for a scheme proposed for a compromise, arrangement or reconstruction or merger between it and another company (section 539 CAMA).

14.A resolution by the company to pay interest on equity capital raised to defray the expenses of certain infrastructure projects which cannot be made profitable for a long period (section 113 CAMA).

15.   A resolution to determine that any portion of the company’s share capital which has not been already called up shall not be capable of being called up except in the event and for the purposes of the company being wound up (section 134 CAMA).

16. A resolution of the holders of a class of shares to vary the rights attached to that class of shares (section 141 CAMA).

17. A resolution to alter remuneration of directors fixed by articles of association (section 267 CAMA).

18.In a member’s voluntary winding up, a resolution, on or after the appointment of a liquidator, that the accounts of the company shall not be audited prior to its being laid before the general meeting (section 470(6).

19.In a members voluntary winding up a resolution to authorise the liquidator to pay any classes of creditors in full; to make any compromise or arrangement with creditors; to compromise all calls, and liabilities to calls, debts and liabilities (section 481).

By: Magnus Amudi
Magnus Amudi is an Associate Attorney at Aelex. His major areas of practice are Corporate/Commercial Law, Energy and Natural Resources, Company Secretarial/Compliance, Labour and Employment Law.

Ed's Note: This article was originally published here.


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