First directors

[Yeshwanth u]

Dear All,

PFB, my query on appointment of first directors.

Section 254.

In default of and subject to any regulations in the articles of the company, subscribers of memorandum who are individuals, shall be deemded to be the directors of the company, untill the directors' are duly appointed in a accordance with section 255.

Section 255.

(1) unless the articles provide for the retirement of all directors at every AGM, not less than 2/3rd of the total number of directors of the public company,or of a private company which is a subsidiary of a public company, shall-

       (a) be person whose period of office is liable to determination by retirement of directors by rotation; and

       (b) Save as otherwise expressly provided in this act,be appointed by the company in general meeting.

My query,

Public company appointing its first director through articles (sec 254), can it classify the director/s as rotational director/s in articles.

If yes, sec 255 tells rotational directors shall be appointed in general meeting. Therefore articles can't clasify the director/s as rotational director. 

If no, sec 255 mandates to classify atleast 2/3rd of total number directors as rotational director. Therefore sec 255 is not complied. 

 

Regards

Yeshwanth.U

 

AI Summary

Appointment of first directors: rotational status fixed when regular directors are appointed to satisfy retirement-by-rotation requirements.
First directors named in the Articles act as the company's initial directors; otherwise individual subscribers are deemed directors until regular directors are appointed. First directors are not appointed by members and hold office only until regular directors are chosen. The rotational status required by statute must be specified when regular directors are appointed in a general meeting, at which point the company must classify directors as liable to retirement by rotation to comply with the retirement-by-rotation framework.