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Board Meetings ðŸĒ

Definition (Section 173): Meeting of the Board of Directors to discuss company's management and policy.

Different from General Meetings: Only directors attend (not shareholders).

Frequency & Timing ⏰

Minimum Meetings: 4 times a year (at least one per quarter). Maximum Gap: 120 days between two meetings.

Notice: 7 days (in writing to all directors). Shorter Notice: Allowed if at least 1 Independent Director is present.

Quorum for Board Meetings ðŸ‘Ĩ

Quorum = 1/3rd of total strength OR 2 directors, whichever is higher.

Examples:

  • 6 directors → Quorum = 6/3 = 2 ✅
  • 5 directors → Quorum = 5/3 = 1.67 ≈ 2 (round up) ✅
  • 9 directors → Quorum = 9/3 = 3 ✅

Interested Directors: If a director has personal interest in agenda item, he must not participate in that item (recuses himself). He won't be counted for quorum for that item.

Powers of Board 💞

Can Decide:

  1. Business Strategy: Future plans, expansion.
  2. Appoint/Remove key personnel (CEO, CFO below MD level).
  3. Borrowing (within limits).
  4. Investments: Where to invest company funds.
  5. Issue of Securities (shares/debentures) as per authorization.
  6. Declare Interim Dividend.

Cannot Decide (Need Shareholders' Approval):

  • Issue of shares beyond authorized capital.
  • Alteration of Articles/Memorandum.
  • Reduction of share capital.
  • Sale of whole/substantial part of business.
Video Conferencing Allowed

Directors can attend Board meetings via Video Conferencing (VC).

Conditions:

  • Record of VC must be maintained.
  • Chairman must ensure proper identification.
  • Certain sensitive matters (approval of financial statements, board report) require at least one director to be physically present.

Since COVID: VC became standard practice for most companies!

Minutes of Board Meetings 📝

Must Record (within 30 days):

  • Decisions taken.
  • Dissent by any director (if any).
  • Who attended, who recused.

Preserved for: 8 years.

Types of Board Meetings 📋

  1. Regular Board Meetings: Scheduled quarterly meetings.
  2. Special Board Meetings: Called for urgent mattres (e.g., response to hostile takeover).
  3. Committee Meetings: Sub-committees (Audit Committee, Remuneration Committee) also meet separately.

Penalty for Non-Compliance ðŸšŦ

Not holding required Board meetings:

  • Company: Fine up to â‚đ1 Lakh.
  • Every director: Fine up to â‚đ25,000.

Not maintaining minutes:

  • Fine up to â‚đ25,000 (company) + â‚đ5,000 (each officer).

Quiz Time! ðŸŽŊ

Test Your Knowledge

Question 1 of 5

1. Board meetings must be held at least:

2 times a year
4 times a year
6 times a year
12 times a year

ðŸ’Ą Final Wisdom: "Board meetings are where strategy is set and oversight happens. Directors must show up and participate!" ðŸŽŊ

🎉 UNIT IV COMPLETE! You have mastered Company Management & Meetings. From Directors to Resolutions!

Final Unit: Unit V: Winding Up of Companies - The End Game! 🏁

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