17 November 2012

Kenya: Judge Orders KMSF to Convene AGM Within 60 Days

A judge has ordered the Kenya Motorsport Federation Limited to convene an annual general meeting within 60 days.

Giving the directive yesterday, Justice Joseph Mutava also said all members of Federation be notified of the meeting and be allowed to present their agenda, which should be duly incorporated in the agenda for the AGM.

The judge observed the issues raised by two members- Dave Macharia and Jimmy Kahumbura- would better be addressed during the AGM and not the court. Justice Mutava said the notice of the AGM should be made in writing and served to each member in accordance with Article 8 of the company's Articles of Association, at least 21 days from the date of the meeting.

The Registrar of Companies or a representative from his office should be present during the AGM, added the judge.

In August, the two members managed to temporarily stop the AGM which had been planned for August 15 after they complained the AGM had been convened illegally. The duo argued the meeting was illegal as it had not been sanctioned by the board of directors or the federation chairman.

Kahumbura and Macharia are both shareholders of the federation but they complained the conveners of the meeting had not given a proper notice to the shareholders as required by the Companies Act.

Through their lawyer Macharia Kahonge, the two said that they were apprehensive the meeting will be held and thereby breaching the company's articles and the provisions of the Companies Act.

The lawyer added that if not stopped, the meeting will be a sham and might greatly compromise the principle of sound corporate governance.

"Equally it will not be impracticable to conduct any proper meeting as is envisioned under the Companies Act, as certainly no proper accounts have been tendered or furnished to members as envisaged," said the lawyer.

Macharia is the chairman of the Federation as well as the chairman of the Rallye Sports club while Kahumbura is the chairman of the Kenya Motor Sports Club.

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