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A private limited company has four ordinary shareholders. Shareholder 1 and Shareholder 2 each own 30% of the company’s ordinary shares; Shareholder 3 and Shareholder 4 each own 20% of the company’s ordinary shares. The company has unamended model articles as set out in Schedule 1 to the Companies (Model Articles) Regulations 2008.
Recently, the shareholders all received proper notice of a members’ meeting. The meeting was convened to seek shareholder approval of a proposal to enter into a service contract with one of the company’s directors for a fixed term of five years. A request for a poll vote at the members’ meeting was properly made.
Only Shareholder 1 and Shareholder 3 attended the meeting, and no proxies were appointed by those not attending. When the resolution was put to the meeting, Shareholder 1 voted for it, giving his consent to the proposed five year fixed term of the service contract. Shareholder 3 voted against the resolution.
Has the shareholder resolution been passed on a poll vote?
A. No, because the resolution was not approved by at least 50% of the company’s shareholders.
B. No, because the resolution was not approved by more than 50% of the company’s shareholders.
C. Yes, because the resolution was approved by more than 50% of votes cast by the shareholders attending the meeting and entitled to vote.
D. No, because the resolution was not approved by more than 50% of the company’s shareholders attending the meeting and entitled to vote.
E. Yes, because the resolution was approved by at least 50% of votes cast by the shareholders attending the meeting and entitled to vote.
C - Yes, because the resolution was approved by more than 50% of votes cast by the shareholders attending the meeting and entitled to vote.
Candidates who answered correctly: 38%
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Find out what happens after passing the SQE and admission to the roll of solicitors.