Where a share capital of the company is divided into different classes of shares, the rights attached to the shares of any class may be varied with the consent in writing of the holders of not less than three-fourths of the issued shares of that class or by means of a special resolution passed at a separate meeting of the holders of the issued shares of that class
- if provision with respect to such variation is contained in the memorandum or articles of the company or
- in the absence of any such provision in the memorandum or articles, if such variation is not prohibited by the terms of issue of the shares of that class.
- If variation by one class of shareholders affects the rights of any other class of shareholders, the consent of three-fourths of such other class of shareholders shall also be obtained.
- Unlisted Public Company having more than 200 members shall pass Special Resolution only through Postal Ballot. [Section 110 read with Rule 22 of the Companies (Management and Administration) Rules, 2014]
Following Procedure is to be followed
- Check the AOA of the Company
Refer the AOA, if not authorized by the AOA then it needs to be altered for the variation of rights attached to a class of shares. [Refer Procedure for Alteration of Articles]
- Intimation to the Stock Exchange [Regulation 29 of the SEBI (LODR) Regulations, 2015]
Listed Companies shall intimate the Stock Exchange at least 11 working days before convening a Board Meeting where the following proposal is placed
- Any alteration in the nature or form of securities already listed on the stock exchange or in the rights of the shareholders.
- Any alteration in the date on which the redemption amount of redeemable shares shall be payable.
- Convene a Meeting of Board of Directors [As per section 173 & SS-1]
- Issue Notice of Board Meeting to all the Directors of Company at their addresses registered with the Company, at least 7 days before the date of Board Meeting. A shorter notice can be issued in case of urgent business.
- Attach Agenda, Notes to Agenda and Draft Resolution with the Notice.
- Hold a meeting of Board of Directors of the Company and pass the necessary Board Resolution
- to approve the proposal of variation of rights.
- to fix day, date, time and venue for holding General Meeting of the Company.
- to approve the draft circular for obtaining written consent or draft notice of General Meeting or Postal Ballot along with explanatory statement annexed to the notice as per requirement of the Section 102 of the Companies Act, 2013.
- to authorize the Director or Company Secretary to sign and issue notice of the General Meeting or Postal ballot and to do such acts, deeds and things as may be necessary to give effect to the Board’s decision.
- Listed Company shall submit the outcome of Board Meeting as soon as reasonably possible but not later than the following:
- thirty minutes from the closure of the meeting of the board of directors in which the decision pertaining to the event or information has been taken
- twelve hours from the occurrence of the event or information, in case the event or information is emanating from within the listed entity
- twenty four hours from the occurrence of the event or information, in case the event or information is not emanating from within the listed entity, from the conclusion of the Board Meeting and post the same on the website of the Company within 2 working days. [Regulation 30 & 46(3) of the SEBI (LODR) Regulations, 2015]
- Prepare and Circulate Draft Minutes within 15 days from the conclusion of the Board Meeting, by Hand/Speed Post/Registered Post/Courier/E-mail to all the Directors for their comments. [Refer the Procedure for Preparation and Signing of Minutes of Board Meeting]
- Obtain Shareholders’ Approval
Convene General Meeting [Section 96, 100 and SS-2]
- Notice of General Meeting shall be given at least clear 21 days before the actual date of a General Meeting in writing, by hand or by ordinary post or by speed post or by registered post or by courier or by facsimile or by e-mail or by any other electronic means or a Shorter Notice can be issued with the consent of at least majority in number and ninety five percent of such part of the paid up share capital of the company giving a right to vote at such a meeting in accordance with Section 101.
- Notice will be sent to all the Directors, Members, Auditors of Company, Secretarial Auditor, Debenture Trustees and to others who are entitled to receive the notice of the General Meeting.
- Notice shall specify the day, date, time and full address of the venue of the Meeting and contain a statement on the business to be transacted at the Meeting.
- Hold the General Meeting of a Class of Shareholders on fixed day and pass Special Resolution for Variation of Shareholders’ Right.
- Listed Companies shall disclose the proceedings of General Meeting to the Stock Exchange within 24 hours from the conclusion of General Meeting and same shall be posted on the website of the company within 2 working days. [Regulation 30 and 46(3) of the SEBI (LODR) Regulations, 2015]
- Listed Companies shall submit to the stock exchange the details of the voting results within two working days from the conclusion of the meeting and post the same on the website of the Company. [Regulation 44 of the SEBI (LODR) Regulations, 2015]
- Prepare the minutes of General Meeting, get them signed and compile accordingly. [Refer the Procedure for Preparation and Signing of Minutes of General Meeting].
- File Form MGT-14 with ROC
File Form MGT-14 with the ROC within 30 days of passing Special Resolution in General Meeting along with fee as specified in the Companies (Registration offices and fees) Rules, 2014 and with the following attachments
- Certified True Copies of the Special Resolution passed along with Explanatory Statement
- Copy of the Notice of meeting sent to members along with all the annexure
- Shorter Notice Consent Letters from the members in case the General Meeting was convened at shorter notice
- Copy of Attendance Sheet of General Meeting
- Any other attachment as may be applicable.