Frequent errors in the way of thinking that cause the delay in creating shareholder agreements include: for those who start a business in South Africa, it is important to take into account the benefits that 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.” 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. Shareholders accept that if a shareholder does not have the financial means to follow his rights, the obligation to issue preferential rights does not constitute unjustified, unjust or unjust conduct. 3. When a company wants to raise funds by providing a passive investor who will contribute funds as equity capital. The shareholders` pact will be necessary to define the rights, responsibilities and obligations of existing shareholders (who generally retain an active role in the management of the company) and new shareholders who can only play a passive role. This shareholders` pact is accompanied by detailed information that provides more information and support. 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. 1.13. Any reference to a party in this agreement, if that party is liquidated or seized, also applies to the liquidator or agent of that party, if that party may be, and engages it with respect to that party. Some of the aspects that will be addressed in the shareholders` pact should include: 11.1.

The parties choose as their domilia citandi and executandi for the purposes of this Agreement, whether with respect to court proceedings, notices or other documents or communications of any kind, the following addresses: 10.2. Shareholders expect the company to distribute dividends for each of its fiscal years. (g) shareholders – from time to time all registered shareholders of the company.