AGM season 2022 - issues bullet list

As the 2022 AGM season commences, Partner and Head of Capital Markets, Brent Van Staden has complied a list of issues that may arise when preparing the Annual General Meeting Notices (NOMs).

Some issues to consider include: 

Meeting Format - will you be holding a virtual only, hybrid or traditional AGM format? Temporary relief for virtual meetings has now lapsed - the new rules mean that virtual meetings are now only available if expressly permitted by the Company Constitution (see below re amending your Constitution).

AGM and Director Nominations - Announcement - announce the proposed date of the AGM date and closing date for director nominations, per ASX Listing Rule 3.13.1.

Director Rotations - director re-appointment resolutions.

15% Issue Capacity - Listing Rule 7.1 issue capacity - refresh under Listing Rule 7.4 to ensure full issue capacity is available.

Additional 10% Issue Capacity - Listing Rule 7.1A additional 10% issue capacity - prepare a special resolution to enliven this option, if your entity is not included in the ASX 300.

ASX Voting Exclusion Statements - ensure that they comply with ASX Listing Rule 14.11.

KMP - disclosure and voting exclusions - ensure they are included in the NOM.

Related Party Transactions -

• ASX Listing Rule 10 approvals - typically for the issue of performance rights or options to director.
• Chapter 2E Corporations Act - compliance issues - regulated disclosure in the NOM/Explanatory Statement and lodgement of the NOM with ASIC 14 days before despatch (unless relying on the "reasonable remuneration" exception).

Voting to be conducted on polls - substantive resolutions for listed entities will need to be conducted by way of a poll, in line with ASX corporate governance requirements for listed entities.

ESOP/Incentive Plan Refresh - the plan rules must be approved by shareholders every 3 years to remain effective under Listing Rule 7.2 Exception 13 (so that ESOP issues don't use up 15% issue capacity).

Appointment of Auditor - if there was a change of auditor during the year, this resolution must be included.

Proportional Takeover Provisions - these provisions in the Constitution require that they be refreshed by shareholder approval every 3 years (s 648D Corporations Act) - provides basic defence to proportional takeover offers.

Remuneration Report - consider whether there was a ‘first strike’ on the remuneration report at the previous AGM, in which case provision needs to be made in this year's NOM to cater for a possible second strike.

Amendments to Constitution - consider the following amendments:

• to permit virtual and hybrid meetings and use of electronic meeting documents - generally, current Constitutions do not provide the level of authority required to use these new options for meetings.
• consider amendment to the effect that a quorum is only required to be present at the start of the meeting (which avoids issues if there ceases to be a quorum at a point after commencement of the meeting - this is going to be more relevant with virtual/hybrid meetings).
• [CHESS replacement -  amendments are not recommended for the ASX migration from CHESS for NOM's this year - the 2023 AGM season is more appropriate for that, given the 2024 go-live date].

Auditor notice - give notice of the AGM to the auditor - s 249K Corporations Act.

Registry - liaise with your share registry for the drafting of the proxy form and logistical issues.

Proxy advisors and top 20 - engage with proxy advisers and material shareholders early.

NOM Lodgements - AGMS for listed public companies with a financial year of 30 June will need to be held by 30 November 2022 (now that earlier ASIC relief has expired). This means that the NOM will need to be finalised and sent to shareholders by the end of October 2022. Consider whether ASIC lodgement is needed - typically 14 days before despatch.