The MOI is the top ranking of the two documents. However, it is a public document, so some of the issues that shareholders want to govern more confidentially need to be addressed in the shareholders` pact. Any point of the shareholders` pact that is in conflict with the MOI is null and void and not entitled. It is therefore important that both documents be prepared simultaneously. For those who start a business in South Africa, it is important to consider the benefits you need or not from a shareholder pact. Please note that the information below uses the term “shareholders` pact” in the general sense of the term, as it also applies to those who participate in a close corporation, the only change being that it is called a “member agreement.” This agreement expressly provides that the rights and obligations provided for are included, in addition to all rights and obligations, in the company`s statutes and in the 1973 Corporations Act. 11.1. The parties choose as their home citandi and executandi for all purposes of this Agreement, whether with respect to court proceedings, communications or other documents or communications of any kind, the following addresses: What happens to your actions if you die? Now, could you say they go to your spouse and/or your children, but if the shoe is on the other foot, would you want to be in business with your partner`s spouse and/or children? This issue is all the more important in companies where shareholders are active on a daily basis. We believe it is essential that the shareholders` pact (and the MECs) clearly determine what happens to the shares of a deceased, disabled, outgoing or insolvent shareholder. 2. When two or more existing companies that carry out their own operations contract a joint venture for specific purposes and use a business as a vehicle for the joint venture. An example could be where a supplier and distributor are needed to enter into a contract for a large project.
You can create a joint venture to close the contract. They will want a shareholder pact that would set out their respective rights, obligations and responsibilities; 10.3. Dividend payments depend on the company`s directors` belief that the solvency and liquidity requirements required by law have been met and that shareholders are in good faith satisfied with the requirement of prudence with respect to the company. No shares may be issued except through a rights offer proportional to all shareholders on that date. If a shareholder does not respect his rights, he is deemed to have renounced the other shareholders who follow their rights in the same proportions as their rights.Leave a reply