Can a covenant between a shareholder and an employee be enforced?

Generally, restrictive covenants between shareholders, are more easily enforced than those between employer and employee. You may wish to have an obligation upon shareholders to provide further funds to the company, if the company requires it and to specify the form in which this funding is to be provided.

How are shareholders agreements worded to bind the company?

A shareholders agreement could be worded to bind the company • all major executive decisions by the directors are made by a majority, including decisions to change the nature of the business.

Can a majority shareholder sign a shareholders agreement?

Shareholders’ agreements are not just designed for those shareholders who hold less than 50% of the shares in a company. In many cases such agreements are drafted for the majority shareholder.

How does a shareholder agreement work in Australia?

The Company is incorporated in the Commonwealth of Australia under the Corporations Act (the “Act”). B. The Shareholders have decided to enter into this agreement (the “Agreement”) to govern their respective interests, obligations, liabilities, ownership and rights in the Company.

Can a minority shareholder block the appointment of a director?

In general, minority shareholders cannot block the passing of ordinary resolutions, such as the appointment and removal of board directors. In other words, a minority shareholder can have 49% of shareholding but still have no power to influence the composition of the board of directors.

What are the provisions of the shareholders agreement?

No Shareholder shall voluntarily or involuntarily transfer, assign, sell, or convey any interest in his shares of the Corporation, now owned by such Shareholder or hereafter acquired by him, except in accordance with the provisions of this Agreement.

How does a shareholder object to an arbitrator?

Any Shareholder may object to a proposed arbitrator and propose an alternate by delivering a written notice of objection to all other Shareholders within 15 Business Days of receiving the Notice of Dispute. All of the proposed arbitrators will jointly appoint an arbitrator.