Your
company is growing by leaps and bounds, you and your team are working around
the clock, and it seems that there is a never-ending list of customer and
operational issues. A calendar reminder pops up on your screen – it’s
time to hold your company’s annual general meeting of shareholders
(“AGM”). The temptation to simply circulate written resolutions to the
shareholders for signature briefly crosses your mind. After all, nothing
unusual is happening this year: same directors are to be elected, same
accounting firm is to be appointed, and the financial statements have been
prepared and are ready to be mailed out.
For
time-pressed entrepreneurs, the annual AGM requirement seems like a luxury of
time and resources that they can ill-afford. However, consider
this: the AGM also affords a wonderful opportunity to showcase the
company’s growing capabilities to a room is filled with individuals who have an
interest in your company. Once the formal AGM business has been completed
(10 minutes), you can maximize the remaining time by providing a business
update and roadmap of the company’s planned activities for the coming year,
answering questions from and networking with the co-owners of the
company. You may even decide it is a great opportunity to practice your
investor pitch for an upcoming financing!
As
well, many small companies choose to provide unaudited financial statements to
their shareholders. An AGM is a perfect venue to obtain the waiver of
audit from both voting and non-voting shareholders, as required by law in
certain jurisdictions. Similarly, if you are making amendments to your
shareholders agreement, at the AGM you will have a large portion (if not all)
of the shareholders in one spot- rather than chasing them after the meeting by
telephone or email, get signatures while they are all there! Consider adding
this as an agenda item so it doesn’t get overlooked.
At
MDK, we provide innovative legal solutions for entrepreneurial businesses
including corporate secretarial services for board meetings and scrutineer
services for AGMs. For further information, please
contact us today to set up a free 30 minute consultation on how we may assist
your business.