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ARTICLE · 17 MARCH 2016

Placement agreement paramount despite shareholder dispute

HopgoodGanim
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A Court would be reluctant to vary the agreement or to imply obligations, so the terms and requirements are paramount.

AustraliaCorporate/Commercial Law
Robyn Ferguson
Robyn Ferguson
Kellie Clee
Kellie Clee
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In the recent decision of Cauldron Energy Ltd v Beijing Joseph Investment Co Ltd [2016] WASC 22, the Court held that the requirement to obtain shareholder approval under a placement agreement was satisfied. This was despite the fact that in obtaining the approval, shareholders were not provided with all information material to the decision of whether or not to vote in favour of the resolutions.

Partner Robyn Ferguson and Associate Kellie Clee discuss the implications of this decision in the following alert.

Background

Cauldron Energy Ltd (Cauldron) entered into four letter agreements for the placement of shares in Cauldron to Beijing Joseph, Joseph Investment, Guangzhou City and Guangzhou Joseph for a total subscription price of $4 million.

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