Written by Practicing Lawyers in Austalia
Free Legal Drafting Book with Every Purchase
Don’t Get Caught Out With Legal Documents That Don’t Comply
Immediate Word Download
Written by Australian Lawyers
Save & Edit as You Require
Safe & Secure
Minority Shareholders Agreement
The marginalisation of one shareholder or group of shareholders is called ‘shareholder oppression’. The shareholder oppression claims heard in Australian courts are in situations where a minority shareholder (or shareholders) are being unfairly treated by a larger (and usually a majority) shareholder.
The oppressive conduct provisions of the Corporations Act are commonly used in conjunction with a claim of breach of director’s duty or in bringing an application to wind up the company entirely. Situations in which shareholder oppression occurs may be avoided by using a minority shareholder agreement, particularly in situations where the minority shareholders are making a significant financial contribution to the company.
Minority Shareholder Agreement
Contents
- 1 DEFINITIONS & INTERPRETATION
- 1.1 Definitions
- 1.2 Interpretation
- 2 APPOINTMENT OF NOMINEE DIRECTORS
- 3 MAXIMUM NUMBER OF DIRECTORS
- 4 POWER OF MAJORITY SHAREHOLDERS
- 4.2 Working Capital
- 5 PUT OPTION
- 5.2 Determination of price
- 5.3 Sale of shares
- 5.4 Indemnity
- 5.5 Consent
- 6 GENERAL PROVISIONS
- 6.2 Counterparts
- 6.3 Force majeure
- 6.4 Further assurance
- 6.5 Governing law and jurisdiction
- 6.6 Notices
- 6.7 Service of notices
- 6.8 Severability
- 6.9 Survival & merger
- 6.10 Variation
- 6.11 Waiver
- 6.12 Warranties and representations
- 6.13 Whole agreement
- SCHEDULE 1
- EXECUTION
Fully formatted precedent in Microsoft word, ready to download edit and use.
11 Pages long.
Suitable for Use
Pages
Don’t Waste Time Customising Templates Online
Download Once, Save & Edit
It’s Yours To Keep
Shareholder Agreements
The marginalisation of one shareholder or group of shareholders is called ‘shareholder oppression’. The shareholder oppression claims heard in Australian courts are in situations where a minority shareholder (or shareholders) are being unfairly treated by a larger (and usually a majority) shareholder. The oppressive conduct provisions of the Corporations Act are
commonly used in conjunction with a claim of breach of director’s duty or in bringing an application to wind up the company entirely. Situations in which shareholder oppression occurs may be avoided by using a minority shareholder agreement, particularly in situations where the minority shareholders are making a significant financial contribution to the company.
1 Shareholder oppression
Shareholder oppression occurs when majority shareholders in a corporation take action thatunfairly prejudices the minority. It most commonly occurs in small unlisted companies, because the lack of a public market for shares leaves minority shareholders particularly vulnerable. In a small, private company minority shareholders cannot escape mistreatment by selling their stock and exiting the corporation. The majority shareholders may harm the economic interests of the minority by refusing to declare dividends or locking the minority out of the corporate premises and even deny the minority the right to inspect corporate records and books, making it necessary for the minority to sue every time it wants to look at them.
An oppressed minority shareholder can ask the court to dissolve the corporation or to hold the
corporation’s leaders accountable for their fiduciary responsibilities. Contractual protections, suchas a minority shareholder agreement, are a potential alternative to statutory protections.
FULL COMMENTARY WITH PURCHASE
This information is not or represents legal advice by Precedents Online or its Authors
Contact – Support@precedentsonline.com.au
View free sample
Don’t waste time customising time-consuming templates online.
Download, Save & Edit
Yours to Keep & Use Forever
What we do
Precedents Online sells legal documents to the legal profession and businesses in Australia. The documents have been created by practising lawyers and are for immediate purchase online.
All legal precedents sold on this site are available for immediate use and have been drafted by practicing lawyers and kept up to date with changes in the law.