Update on the status of the members’ request to convene an EGM (Jan 16, 2020)

Date : 16 Jan 2020

Dear LSCOBA Members,

Background

We refer to our announcements made on 29 July 2019, 7 August 2019, 21 August 2019, 16 October 2019 and 15 December 2019 regarding the members’ requests to convene an extraordinary general meeting. Unless otherwise stated, capitalised terms herein would have the same meanings as defined in our previous announcement of 15 December 2019.

The Committee has been working behind the scenes with numerous meetings and discussions over the past months. The Committee’s discussion mainly revolved around: (a) how to best represent a balanced view and belief of our Members; (b) the purpose, role and scope of the LSCOBA; and (c) the role of which the Committee serves within the LSCOBA.

We would like to reiterate that since this is the first time that such requests for EGM were made, prudence demands us to proceed with care and with due regard to the interests of all Members, LSCOBA and the School. It is one of the main roles of the Committee to ensure that all due processes are executed properly and in accordance with laws and regulations, including the memorandum of association (the “Memorandum“) and the Articles of the LSCOBA.

With all of the above in mind and in order to properly execute the functions of the Committee, the Committee sought independent legal advice from Messrs. Clifford Chance on various legal issues relating to the Requisitions and the proposed EGM, including the legality, enforceability and validity of the Requisitions and the proposed motions (the “Advice”). The Committee also hosted an open forum on 28 December 2019 (Saturday), in which the Committee invited all LSCOBA Members to attend (the “Open Forum”), to explain the Advice sought to our Members.

The Legal Advice received

In summary, the Committee has received the Advice from Messrs. Clifford Chance that the Committee may justifiably refuse to convene an extraordinary general meeting pursuant to the 1st and/or 2nd Requisition, on the basis that their proposed resolutions or the objects of the proposed resolutions are incapable of being effectively achieved, cannot be effectively passed or lawfully effectuated at a general meeting and/or cannot be carried out by the LSCOBA as it lacks the power/right to do so.

The summary of the Advice are set out below:

(1) The Committee has power to convene an EGM requested by a members’ requisitions made by not less than 50 members (Article 39 of the articles of association of the LSCOBA (the “Articles“)).

(2) In considering whether to convene or not to convene an EGM, it would be appropriate for the Committee to consider a range of relevant factors including:

(i) whether the Requisitions are consistent with the objects of the LSCOBA as set out in its Memorandum;

(ii) the rights and power of the Committee under the Memorandum and Articles;

(iii) the well-established case law relating to the role of directors, who have been given power to manage the company, can exercise the power according to their best judgment while holding such positions; and

(iv) whether the time, costs and resources that would be incurred in convening and holding a meeting would be justifiably incurred.

(3) We were advised that the LSCOBA has no right or power to issue a public statement concerning a political incident and matters as acts that the LSCOBA may do are bound by its Memorandum and its Articles. The respective proposed resolutions do not appear to be consistent with the objects of the LSCOBA as set out in its Memorandum, which include, inter alia, (i) to foster and promote close relationships and better understanding among the past and present students of La Salle College in and outside Hong Kong; and (ii) to maintain, promote and cultivate friendship among the members of the LSCOBA (clauses 4 and 5 of the Memorandum).

(4) Pursuant to Articles 12 to 16, members of the Committee are exclusively vested with the right or power to certify to the Committee that in their opinion the conduct of a member of the LSCOBA is injurious to the character or interests of the LSCOBA or is derogatory to his/her station in the LSCOBA. Therefore, the Committee was advised that, ultimately, the Members have no right or standing under the Articles to require the Committee to investigate the conduct of a member of the Association and to request the Committee to convene an EGM to review its decision.

(5) The maintenance and administration of the Facebook group of the LSCOBA is part of the management of the affairs, administration and business of the LSCOBA, which, according to Article 21, is vested in the Committee. Hence, such resolutions that arguably seek to usurp the Committee’s management powers, would not be capable of being lawfully effectuated.

The Committee’s Decision

After careful consideration of the Advice, the Committee is of the view that the proposed resolutions in the Requisitions are invalid and unenforceable and that the convention of an EGM to address such proposed resolutions would not be a responsible and effective use of the resources of the LSCOBA. Moreover, the Committee was advised that it would be ultra vires, i.e. beyond its power, for the LSCOBA and/or the Committee to issue a public statement concerning a political incident and matters proposed by some of our Members.

We also understand that those whom requested the EGM care deeply for their causes and would like to express their views on the LSCOBA platform. We therefore, even after having received the Advice, continued with many internal discussions and, more importantly, further sought Members’ views in the Open Forum held on 28 December 2019, in which all Members were invited to attend and given the chance to express their views. Ultimately, it was resolved in a meeting of the Committee held this month that the Requisitions shall be denied, given that the proposed resolutions in the Requisitions are incapable of being effectively achieved, cannot be effectively passed or lawfully effectuated at a general meeting and/or cannot be carried out by the LSCOBA because it lacks the power or right to do so.

The LSCOBA is an alumni association that represents and comprises of La Salle College’s Old Boys from all walks of life, but choose to come together in the LSCOBA to support the alma mater where all our journeys began. The Committee is extremely proud to serve the LSCOBA and will continue to focus the LSCOBA’s resources on promoting the objectives of the LSCOBA, particularly in supporting the Brothers, the School and the current students and serving the Old Boys’ community.

I, on behalf of the whole Committee, thank all the Members for their understanding, support and involvement in this matter.

Thank you.

Regards,

Herman Bo (1989)

President, LSCOBA 2019-2020