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Understanding Special Meeting (Corporate Law): A Comprehensive Guide
Definition & Meaning
A special meeting is a gathering of shareholders called to address specific issues outlined in the meeting notice. Unlike the regular annual general meeting, a special meeting is convened to focus on particular matters that require immediate attention. In corporate governance, certain limitations may be imposed that can either increase the level of shareholder support needed to initiate a special meeting or completely restrict the ability to call one.
Table of content
Legal Use & context
Special meetings are primarily used in corporate law, particularly in the governance of corporations. They allow shareholders to discuss urgent matters that cannot wait until the next annual meeting. This can include issues like mergers, acquisitions, or significant changes to corporate policies. Shareholders may utilize legal templates from US Legal Forms to draft necessary documents related to special meetings.
Key legal elements
Real-world examples
Here are a couple of examples of abatement:
Example 1: A technology company needs to discuss a potential merger with another firm. The board calls a special meeting to allow shareholders to vote on this matter.
Example 2: A corporation wants to amend its bylaws regarding shareholder voting rights. A special meeting is convened to address this specific change. (hypothetical example)
Relevant laws & statutes
In Arizona, the relevant statute governing special meetings is A.R.S. § 10-702. This statute outlines the requirements for calling a special meeting, including who can call it and the necessary notice provisions.
State-by-state differences
State
Special Meeting Requirements
Arizona
Meetings can be called by the board or authorized individuals; specific notice requirements apply.
Delaware
Shareholders can call a special meeting if they hold a specified percentage of shares; notice must be given.
California
Special meetings can be called by the board or by shareholders holding at least 10% of the voting power.
This is not a complete list. State laws vary, and users should consult local rules for specific guidance.
Comparison with related terms
Term
Definition
Annual Meeting
A regularly scheduled meeting where shareholders vote on corporate matters and elect directors.
Board Meeting
A meeting of the board of directors to discuss corporate governance and management issues, not limited to shareholders.
Informal Meeting
A gathering that may not follow formal notice requirements or procedures but discusses corporate matters.
Common misunderstandings
What to do if this term applies to you
If you are a shareholder and believe a special meeting is necessary, review your corporation's bylaws to understand the process for calling one. You may need to gather support from other shareholders. Consider using US Legal Forms to access templates that can help you draft the necessary documents. If the situation is complex, consulting a legal professional may be advisable.
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