Tag: Section 111A
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Shareholders Agreements: Clauses and Enforceability
[Posted by Umakanth Varottil] Shareholders agreements are contracts among shareholders of a company (to which the company is also usually a party) that confer rights and impose obligations over and above those provided by company law. The agreements provide for matters such as restrictions on transfer of shares (right of first refusal, right of first…
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Public Company shares cannot be fettered at all, says Bombay HC
[Posted by Somasekhar Sundaresan] The Bombay High Court has ruled that any pre-emptive rights over shares in public limited companies are patently illegal in view of the principle of “free transferability” enshrined in Section 111A of the Companies Act, 1956 (“the Act”). This revives the debate on enforceability of shareholder agreements and joint venture agreements…