Cuzo and Sir Fred have been calling for an extraordinary general...

Cuzo and Sir Fred have been calling for an extraordinary general meeting of CMR. It does not quite work like this however. Sir Fred says ‘Maybe we need 100 shareholders to call an EGM where the board can be questioned or, management agree to answer questions from a nominated shareholder representative at a meeting’. Cuzo says ‘People reckon you only need 100 to call a meeting - well if my email box gets filled with say 150 names - Ill will spear it off to the company and ask they check the names against the shareholder list and if there is 100 - ask they call an EGM’.

Section 249D of the Corporations Act says that the directors of a company must call a meeting if requested by 100 members. But this can’t be by email as Cuzo suggests. The request must be in writing and must be signed by each member making the request, it must also state any resolution to be proposed etc etc (see S 249D(2). This is a significantly greater task than envisaged by Cuzo.

Furthermore the meeting must be for a proper purpose s 249Q. You cannot just request a meeting to berate the directors, get information, ask questions etc etc. The meeting must be called for a purpose such as changing the constitution or removing directors. Calling an EGM involves a non-trivial financial cost and more importantly would be a significant distraction at a time when management should be putting in 100% effort to getting CMR back on track. I share your pain, Cuzo and Sir Fred, but calling an EGM is not the way to go.