A capital expenditure is the money spent on acquiring or upgrading physical assets such as buildings and machinery. The shareholders` agreement on large investments protects shareholders against employees or senior managers of the company making excessive investments in certain companies without the shareholders` agreement. It protects shareholders` investment from the poor judgment of an executive or employee. The amount of the limit depends on the size and resources of the company, as well as the confidence of shareholders in its management. No no. Shareholder agreements are designed to be next to your articles of association and are not documents intended for the public. You are an agreement that you respect with your business files and accounts that should not be verified until there is a problem, just as you do not actively use your insurance or will. A shareholders` agreement can be held by your accountant or with your usual deposit, but it is important not to lose only just in case; An accountant will be able to keep the document secure and advise you on any major changes to your business, in accordance with your shareholders` agreement. Under the Corporations Act4, a company`s articles of association are considered a contract between each shareholder and any other shareholder, as well as with the company. If a person agrees to become a shareholder of the company and his or her name is entered in the register of shareholders, that person is automatically bound by the company`s articles of association and any future changes to the company (subject to certain exceptions).5 Shareholders may also agree to choose a list of specific directors. There could be ten shareholders, but all shareholders could agree to have three directors in particular. The latter option may be beneficial if shareholders recognize that the majority shareholder should have greater representation, but minority shareholders each wish to have a director on the board of directors to ensure that their interests are protected. A minority shareholder is usually someone who has the smallest number of shares in the company.
Often, votes are decided not only by the number of shareholders who vote for something, but also by the fact that each shareholder has the number of votes he has of shares, so that the vote of a minority shareholder has much less weight than that of a majority shareholder. Sometimes minority shareholders may have another class of shares, for example. B shares A and B, which may have different rights and obligations, in particular with regard to dividends and voting rights. Whenever you have two or more shareholders in a company, it`s a good idea to have a shareholders` agreement to protect everyone`s rights. The indication of the company`s senior managers may prevent subsequent shareholders from dismissing senior managers, even if they acquire a majority stake or control of the board of directors. This can offer the company a certain degree of management consensus. For the same reason, the indication of senior managers can also prevent the company from attracting demanding institutional investors who wish to set up their own management team for the management of the company. . .