An extraordinary general meeting (EGM) refers to a formal assembly of the members or shareholders of a company that is convened for addressing specific matters or issues outside the scope of the regular annual general meeting (AGM). Also known as a special general meeting, an EGM is called when urgent or significant decisions need to be made that cannot wait for the next scheduled AGM.
During an EGM, shareholders gather to discuss, deliberate, and vote on matters that require their approval, such as major corporate changes, amendments to the company's constitution, adoption of new policies, appointing new directors, authorizing share issuances, or resolving disputes. Unlike an AGM that is held annually as a mandatory requirement, an EGM is typically called on an ad hoc basis as per the need of the company or upon the requisition of a specific number or percentage of shareholders.
Procedures followed during an EGM are similar to an AGM, including the issuance of proper notice to the members, circulation of agenda, presentation of financial reports, and voting on resolutions. The decision-making process in an EGM often involves a majority or special majority requirement for resolutions to be passed, which is determined by the company's articles of association or applicable legal requirements.
Extraordinary general meetings play a crucial role in providing shareholders with an opportunity to voice their concerns, participate in important decision-making, and exercise their voting rights in exceptional circumstances outside the regular course of business.
