Special meetings: Overview, definition, and example
What are special meetings?
Special meetings are meetings called for specific, often urgent, purposes outside the regular schedule of meetings. These meetings are typically convened by a company, organization, or governing body to address important or time-sensitive issues that cannot wait until the next regular meeting. A special meeting may be called by directors, executives, or a group of stakeholders depending on the organization’s rules or governing documents.
In corporate settings, special meetings are used to discuss critical matters such as mergers, acquisitions, major financial decisions, changes in leadership, or changes to company policies or bylaws.
Why are special meetings important?
Special meetings are important because they provide a mechanism for quickly addressing urgent or important issues without waiting for the next regularly scheduled meeting. This allows organizations to make timely decisions on matters that require immediate attention and cannot be postponed until the next annual or quarterly meeting. For example, if a company needs to approve an emergency acquisition or amend a vital contract, a special meeting can be called to facilitate quick approval.
Special meetings also ensure that important matters can be addressed with all relevant stakeholders present, which helps maintain transparency, governance, and accountability within the organization.
Understanding special meetings through an example
Imagine a publicly traded company, Company A, that holds quarterly board meetings to discuss ongoing operations and performance. However, an unexpected opportunity for an acquisition arises, and the board needs to make a quick decision. In this case, the board members may call a special meeting to discuss and approve the acquisition deal. This ensures that the decision can be made promptly, before the next scheduled meeting.
In another example, an employee union might call a special meeting to discuss urgent changes to the terms of their contract or to address a critical issue regarding labor conditions. The union leadership would convene a special meeting of all union members to vote on the matter.
An example of special meetings clause
Here’s how a special meetings clause might appear in a corporate governance document or agreement:
“The Board of Directors may call a special meeting of the shareholders at any time to address urgent business matters. A special meeting may be called by the Chairman of the Board or at the request of shareholders holding at least 10% of the company’s outstanding shares. Notice of the special meeting shall be given to all shareholders at least 10 days prior to the meeting date, outlining the agenda of the meeting.”
Conclusion
Special meetings are an important tool for organizations to address urgent, time-sensitive, or critical matters outside of their regular meeting schedules. By providing a forum to discuss and resolve issues quickly, special meetings help organizations remain agile and responsive to changes. Whether in corporate governance, associations, or employee organizations, special meetings ensure that important decisions can be made in a timely and transparent manner.
This article contains general legal information and does not contain legal advice. Cobrief is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.