Gray and Co, lawyers, abogados, international legal services, Panama City

Beth Anne Gray J., LL.B. (Hons.) & Victoria Tejada LL.B.

P.O. Box 832-0816 - World Trade Centre - Panama City - Republic of Panama

International Legal Services

 

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[IBC Act - Part IX]
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[IBC Act - Part XI]
[IBC Act - Part XII]

International Business Companies Act (1984) 

PART VI

Protection of Members and Creditors

 

Meetings of members

59.

(1)

Subject to any limitations in the Memorandum or Articles, the directors of a company incorporated under this Act may convene meetings of the members of the company at such times and in such manner and places within or outside the British Virgin Islands as the directors consider necessary or desirable.

 

 

 

(2)

Subject to a provision in the Memorandum or Articles, for a lesser percentage, upon the written request of members holding more than 50 percent of the votes of the outstanding voting shares in the company, the directors shall convene a meeting of members.

 

 

 

(3)

Subject to any limitations in the Memorandum or Articles, a member shall be deemed to be present at a meeting of members if

 

 

 

 

(a)

he participates by telephone or other electronic means; and

 

 

 

 

(b)

all members participating in the meeting are able to hear each other.

 

 

 

(4)

A member may be represented at a meeting of members by a proxy who may speak and vote on behalf of the member.

 

 

 

(5)

The following apply in respect of joint ownership of shares:

 

 

 

 

(a)

if 2 or more persons hold shares jointly each of them may be present in person or by proxy at a meeting of members and may speak as a member;

 

 

 

 

(b)

if only one of them is present in person or by proxy, he may vote on behalf of all of them; and

 

 

 

 

(c)

if 2 or more are present in person or by proxy, they must vote as one.

 

Notice of meetings of members

60.

(1)

Subject to a requirement in the Memorandum or Articles to give longer notice, the directors shall give not less than 7 days notice of meetings of members to those persons whose names on the date the notice is given appear as members in the share register referred to in section 28 and are entitled to vote at the meeting.

 

 

 

(2)

Notwithstanding subsection (1), and subject to any limitations in the Memorandum or Articles, a meeting of members held in contravention of the requirement to give notice is valid if members holding a 90 percent majority, or such lesser majority as may be specified in the Memorandum or Articles, of

 

 

 

 

(a)

the total number of shares entitled to vote on all the matters to be considered at the meeting; or

 

 

 

 

(b)

the votes of each class or series of shares where members are entitled to vote thereon as a class or series together with an absolute majority of the remaining votes,

 

 

 

 

(c)

have waived notice of the meeting; and, for this purpose, the presence of a member at the meeting shall be deemed to constitute waiver on his part.

 

 

 

(3)

The inadvertent failure of the directors to give notice of a meeting to a member, or the fact that a member has not received the notice, does not invalidate the meeting.

 

Quorum for meetings of members

61.

The quorum for meetings of members for purposes of a resolution of members is that fixed by the Memorandum or Articles; but, where no quorum is so fixed, a meeting of members is properly constituted for all purposes if at the commencement of the meeting there are present in person or by proxy, one-half of the votes of the shares of each class or series of shares entitled to vote as a class or series thereon and the same proportion of the votes of the remaining shares entitled to vote thereon.

 

Voting by members

62.

(1)

Except as otherwise provided in the Memorandum or Articles, all shares vote as one class and each whole share has one vote.

 

 

 

(2)

The directors of a company incorporated under this Act may fix the date notice is given of a meeting as the record date for determining those shares that are entitled to vote at the meeting.

 

Voting trust

62A.

(1)

One or more members of a company incorporated under this Act may by agreement in writing deposit bearer shares with, or transfer registered shares to, any person authorized to act as trustee for the purpose of vesting in such person, who may be designated voting trustee, the right to vote thereon and the following provisions shall apply:

 

 

 

 

(a)

the period of time for which the trustee may vote shall not exceed 10 years;

 

 

 

 

(b)

subject to paragraph (a), the agreement may contain any other provisions not inconsistent with the purpose of the agreement;

 

 

 

 

(c)

a copy of the agreement shall be filed at the registered office of the company and shall be open to the inspection of members of the company

 

 

 

 

 

(i)

in the case of any beneficiary of the trust under the agreement, daily during business hours, and

 

 

 

 

 

(ii)

in the case of members of the company, subject to the provisions of section 67;

 

 

 

 

(d)

where certificates for registered shares have been issued for shares that are to be transferred to a trustee pursuant to this section, new certificates shall be issued to the voting trustee to represent the shares so transferred and the certificates formerly representing the shares that have been transferred shall be surrendered and cancelled;

 

 

 

 

(e)

where a certificate is issued to a voting trustee, an endorsement shall be made on the certificate that the shares represented thereby in the case of registered shares and the certificates in case of bearer shares are held by the person named therein pursuant to an agreement;

 

 

 

 

(f)

there shall be noted in the share register of the company against the record of the shares held by the trustee the fact that such an agreement exists;

 

 

 

 

(g)

the voting trustee may vote the shares so issued or transferred during the period specified in the agreement;

 

 

 

 

(h)

shares registered in the name of the voting trustee may be voted either in person or by proxy and, in voting the shares, the voting trustee shall not incur any liability as member or trustee, except in so far as he may be liable for his own conduct or acts;

 

 

 

 

(i)

where two or more persons are designated as voting trustees and the right and method of voting any shares registered in their names at any meeting of members or on any resolution of members are not fixed by the agreement appointing the trustees, the right to vote shall be determined by a majority of the trustees, or if they are equally divided as to the right and manner of voting the shares in any particular case, the votes of the shares in such case shall be divided equally among the trustees;

 

 

 

 

(j)

at any time within 2 years prior to the time of expiration of any voting trust agreement as originally fixed or as last extended as provided in this subsection, one or more beneficiaries of the trust under the voting trust agreement may, by written agreement and with the written consent of the voting trustee, extend the duration of the voting trust agreement for an additional period not exceeding 10 years from the expiration date of the trust as originally fixed or as last extended; and

 

 

 

 

(k)

the voting trustee shall, prior to the time of expiration of a voting trust agreement, as originally fixed or as previously extended, as the case may be, file at the registered office of the company a copy of the extension agreement and of his consent thereto, and thereupon the duration of the voting trust agreement shall be extended for the period fixed in the extension agreement, but no extension agreement shall affect the rights or obligations of persons not parties thereto.

 

 

 

(2)

Two or more members of a company incorporated under this Act may by agreement in writing provide that in exercising any voting rights the shares held by them shall be voted

 

 

 

 

(a)

as provided by the agreement;

 

 

 

 

(b)

as the parties may agree; or

 

 

 

 

(c)

as determined in accordance with such procedure as they may agree upon.

 

 

 

(3)

No agreement made pursuant to subsection (2) shall be effective for a period of more than 10 years from the date it is made, but at any time within the 2 years immediately preceding the date of the expiration of the agreement the parties may extend its duration for an additional period, not exceeding 10 years at any one time, as they may desire.

 

 

 

(4)

The validity of any voting trust or other voting agreement is not affected during a period of 10 years from the date when it was created or last extended by reason only of the fact that under its terms it will or may last beyond a period of 10 years.

 

 

 

(5)

This section shall be deemed not to invalidate any voting or other agreement among members or any irrevocable proxy that is not otherwise illegal.

 

Consents of members

63.

Subject to any limitations in the Memorandum or Articles, an action that may be taken by members at a meeting of members may also be taken by a resolution of members consented to in writing or by telex, telegram, cable or other written electronic communication, without the need for any notice.

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Service of notice on members

64.

(1)

Any notice, information or written statement required under this Act to be given by a company incorporated under this Act to members must be served

 

 

 

 

(a)

in the case of members holding registered shares,

 

 

 

 

 

(i)

in the manner prescribed in the Memorandum or Articles, as the case may be, or

 

 

 

 

 

(ii)

in the absence of a provision in the Memorandum or Articles, by personal service or by mail addressed to each member at the address shown in the share register; and

 

 

 

 

(b)

in the case of members holding bearer shares, in the absence of a provision in the Memorandum or Articles, or if the notice, information or written statement can no longer be served as specified in the Memorandum and Articles, if the notice, information or written statement is published in a newspaper in the place where the company has its principal office.

 

 

 

(2)

Subject to a requirement in the Memorandum or Articles to give a specific length of notice, the directors must give sufficient notice of meetings of members to members holding bearer shares to allow a reasonable opportunity for them to take action in order to secure or exercise the right or privilege, other than the right or privilege to vote, that is the subject of the notice.

 

 

 

(3)

For purposes of subsection (2), what amounts to sufficient notice is a matter of fact to be determined after having regard to all the circumstances.

 

Services of process etc. on company

65.

(1)

Any summons, notice, order, document, process, information or written statement to be served on a company incorporated under this Act may be served by leaving it, or by sending it by registered mail addressed to the company, at its registered office, or by leaving it with, or by sending it by registered mail to, the registered agent of the company.

 

 

 

(2)

Service of any summons, notice, order, document, process, information or written statements to be served on a company incorporated under this Act may be proved by showing that the summons, notice, order, document, process, information or written statement

 

 

 

 

(a)

was mailed in such time as to admit its being delivered in the normal course of delivery, within the period prescribed for service; and

 

 

 

 

(b)

was correctly addressed and the postage was prepaid.

 

Books, records and common seals

66.

(1)

A company incorporated under this Act shall keep such accounts and records as the directors consider necessary or desirable in order to reflect the financial position of the company.

 

 

 

(2)

A company incorporated under this Act shall keep

 

 

 

 

(a)

minutes of all meetings of

 

 

 

 

 

(i)

directors;

 

 

 

 

 

(ii)

members;

 

 

 

 

 

(iii)

committees of directors;

 

 

 

 

 

(iv)

committees of officers; and

 

 

 

 

 

(v)

committees of members; and

 

 

 

 

(b)

copies of all resolutions consented to by

 

 

 

 

 

(i)

directors;

 

 

 

 

 

(ii)

members;

 

 

 

 

 

(iii)

committees of directors;