Draft Format of Proxy form MGT-11
In every company, shareholders (members) have the right to attend and vote at meetings. However, sometimes shareholders may not be able to attend these meetings in person. This is where the concept of a proxy comes into picture. A proxy is someone who attends the meeting on behalf of a shareholder and votes according to their instructions. Section 105 of the Company Act 2013 talks about proxies. Summary of the section is here:
What is a Proxy?
A proxy is a person appointed by a shareholder to attend and vote at a company meeting on their behalf. If you’re a shareholder, you don’t want or not able to attend a meeting in person, you can appoint someone else (a proxy) to represent you and vote according to your instructions.
Key points about Proxies
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Who Can Appoint a Proxy?
- Any member (shareholder) who is entitled to attend and vote at a meeting can appoint a proxy.
- The proxy can vote on behalf of the shareholder, but only in line with their instructions.
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Limit on the Number of Proxies
- A proxy can act on behalf of up to 50 shareholders, but the shares held by those shareholders cannot exceed 10% of the total voting rights of the company.
- If a shareholder owns more than 10% of the company’s voting shares, they can only appoint one proxy, and that proxy cannot represent any other shareholder.
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Proxies in case of Section 8 Companies
- If you are a member of a Section 8 company, your proxy must also be a member of the same company.
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Rights of a Proxy
- A proxy cannot speak at the meeting.
- They can only vote on a poll, which is a formal vote taken by the shareholders rather than a show of hands.
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Proxy Form Requirements
- The appointment of a proxy must be done in writing in Form No. MGT-11 and signed by the shareholder.
- The proxy form must be submitted to the company at least 48 hours before the meeting (unless the AOA provide for longer period).
Why Do We Need Proxies?
Proxies are useful when a shareholder is unable to attend a meeting due to any reason or a busy schedule. Instead of not attending meeting and skipping the right to vote, they can ensure that their voice is heard through a proxy. It also helps to ensure smooth participation in decision-making processes, especially when voting on important company matters.
In case of private company, the company can provide otherwise than what is stated in section 105 [ AOA can state Section 105 not applicable]. As private companies enjoy exemptions as per notification dated 5th june, 2015.
Attached herewith draft proxy form MGT-11 for easy reference. Download proxy form
