Review your Shareholders Agreement! Update your MOI!
Have you considered whether the provisions of your shareholders agreement are still valid?
The two year period in which to bring your statutory records in line with the new Companies Act is rapidly coming to a close. If you had concluded a shareholders agreement prior to the effective date of the Act, being 1 May 2011, you may very well find yourself at risk when your shareholders agreement is invalidated by certain provisions of the Act. Once the 2 year period afforded by the new Companies Act has ended, shareholders agreements concluded before the effective date will only be valid to the extent that they do not conflict with the Act!
It is therefore imperative that you review your shareholders agreements NOW in order to mitigate your risk and protect your wealth!
Furthermore have you reviewed your MOI to ensure that it is compliant with the new Companies Act?
Again, the new Companies Act afforded businesses a period of 2 years in which to update their statutory records without incurring the fees levied by the Companies and Intellectual Property Commission (CIPC).
However, saving the fees levied by the CIPC pales in comparison to the burden of knowing that you can no longer rely on your current statutory records for guidance on fulfilling your duties as directors to the Company. This critical document sets out the rights, duties and responsibilities of directors, shareholders and other office bearers. It is the Company’s sole governing document and must be not be overlooked. More importantly the MOI is a director’s contract with the Company – will you be familiar with these terms on 1 May 2013?
Act NOW to rectify this situation and allow us to assist you with getting this administrative burden under control.
Should you have any queries, please do not hesitate to contact Karen Venter at our offices.
All material subject to our Legal Disclaimers.