Part 17A company’s share capital
Chapter 11Miscellaneous and supplementary provisions
656Public companies: duty of directors to call meeting on serious loss of capital
1
Where the net assets of a public company are half or less of its called-up share capital, the directors must call a general meeting of the company to consider whether any, and if so what, steps should be taken to deal with the situation.
2
They must do so not later than 28 days from the earliest day on which that fact is known to a director of the company.
3
The meeting must be convened for a date not later than 56 days from that day.
4
If there is a failure to convene a meeting as required by this section, each of the directors of the company who—
a
knowingly authorises or permits the failure, or
b
after the period during which the meeting should have been convened, knowingly authorises or permits the failure to continue,
commits an offence.
5
A person guilty of an offence under this section is liable—
a
on conviction on indictment, to a fine;
b
on summary conviction, to a fine not exceeding the statutory maximum.
6
Nothing in this section authorises the consideration at a meeting convened in pursuance of subsection (1) of any matter that could not have been considered at that meeting apart from this section.