Company with no directors - what happens next

Company with no directors - what happens next

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I am a shareholder in a private company where both of the directors have just resigned.

I know that the Companies Act requires there to be at least 1 director but I do not understand how one can now be appointed.

Who can call a shareholders' meeting to propose a resolution to appoint a director?

Can the holders of over 50% of the votes simply get together and agree to appoint one?

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By Richard Willis
20th Dec 2013 12:38

The number of shareholdings required

should be in the articles of association, as should the requirements to hold an extraordinary shareholders meeting.

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Replying to jonibarnes:
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By Eileen John
20th Dec 2013 13:12

Not covered in the Articles

The Articles, which are based on latest version of Table A, do not cover the situation where there are no Directors in place to organise a Shareholders' Meeting.

There is no reference to Shareholders organising a meeting.

Will this be covered by the Companies Act anywhere?

 

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By johngroganjga
20th Dec 2013 12:48

The shareholders appoint one or more new directors, from their own number or otherwise.

As Richard says procedures for holding meetings will be in the Articles.  Normally 50% +1 will carry an ordinary resolution to appoint directors but all shareholders must be given proper notice of the meeting even if holders of more than 50% have carved it up in advance.  A written resolution may be possible without the necessity for a meeting.

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By johngroganjga
20th Dec 2013 13:59

Difficult to comment further without knowing e.g. how many shareholders there are, is the need to appoint urgent in view of on-going business, do you or anyone else have a plan as to whom to appoint, have they consented to act etc.

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By Euan MacLennan
20th Dec 2013 13:25

Model Articles

If by "latest version of Table A", you mean the Model Articles for the Companies Act 2006, the appointment of directors is covered by Reg.17.

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