Changes to Memorandum of Association (MOA) can be affected through a special resolution at the shareholder’s meeting. Changing a company's MOA is a complex and time- consuming process, so professional care must be taken during the process.
A company can alter its memorandum by means of alteration in the following clause of Memorandum of Association: .
Changes to the name of a company would require an
alteration to the MOA by passing a special resolution. In case
changes to the name of a private limited or public limited
company are affected, consent or authorization of the Central
Government is not required. In any other case, the consent of
the Central Government would be required. Further, in the
event of a company being registered with a name that bears a
resemblance to the name of an existing company, the Central
Government might ask it to alter its name. In such a case
ordinary resolution is adequate.
In some cases, the alteration of the name may not be allowed
to the following companies:
A company can change its capital clause by the passing of an ordinary resolution in a general meeting. Alteration of capital may relate to: .
Within a period of thirty days of passing a resolution, the altered Articles and Memorandum have to be submitted to the Registrar.
A company must make changes to the MOA for transfer of registered office from one state to another. Usual reasons for changing registered office from one state to another include:
In the event of the registered office has to be shifted from one State to another State, a special resolution has to be approved and approval from the Company Law Board has to be acquired by the company. The changed memorandum must be filed with the Registrar of the State from which the company is changing and also to the Registrar of the State to which the company is shifted. On approval of the Registrar of Companies (ROC), changes must be made in the MOA of the company to reflect the new state where the registered office is situated.
The liability clause can be changed so as to make the liability of the directors unlimited. In any case, the liability of the shareholder cannot be made unlimited. The liability clause can be modified by passing a special resolution. A copy of the resolution should be filed with the Registrar within a period of 30 days. .
The last and final clause of the Memorandum of Association is called the subscription clause. The subscription clause basically lists down the motives of the shareholders behind the incorporation of the company and also states that the subscribers are agreeing to take up shares in the company. It also specifies the number of shares taken up by each subscriber. It is all according to the details specified in the MOA Subscriber Sheet.
The company has to issue a notice of board meeting to all the directors at least 7 days before the date of the board meeting. Provide the agenda along with notes of agenda and draft resolutions for the meeting.
The resolutions with respect to the alteration in MOA have to be passed during the board meeting. Then the approval to be obtained for the alteration in MOA and recommending the proposal for members consideration while passing the special resolution. The date, time and venue of the board meeting have to be fixed and also authorizing a director or any person to send the notice for the same to the members.
The EGM notice would be given at least 21 days before the
actual date of EGM. The EGM can be called on shorter notice
with the consent of at least a majority in number and 95% of
such part of the paid-up share capital of the company granting
i) right to vote at a meeting:
ii) All the Directors.
iii) Members
vi) Auditors of Company
The notice would determine the place, date, day and time of
the board meeting and contain the statement on the business
that to be transacted at the EGM.
Check the quorum and also check whether an auditor is present, if not then the leave of absence is granted or not. The approval to be obtained for the alteration in MOA of passing the Special Resolution.
File the form MGT-14 (Filing of Resolutions and agreements under section 117) with the Registrar along with the requisite filing within the period of 30 days of passing the special resolution, along with the following documents: i) Certified copies of Special Resolution along with an explanatory statement ii) Copy of the Notice iii) Copy of the Altered Memorandum of Associations.