This document is a clause to be inserted into a shareholders’ agreement.
In certain circumstances, it is wise for a director of a company to have the right to appoint an alternate director to act in his or her place. Once the right is provided and a director appoints an alternate director, the alternate director can act in place of the appointing director at any time and for various reasons, including as a result of mental or physical incapacity and even death.
Using this precedent
This is a general clause to be inserted into a shareholders’ agreement. This precedent could also be used as a replacement for the alternate director provisions in the separate precedent “Shareholders’ agreement (short form)”.
When inserting this optional clause into an agreement, care must be taken to ensure that the agreement remains consistent. Cross-references, definitions and schedules should all be checked.
This document has been authored for Lexis Nexis by Elise Margow, Principal, Legally Speaking.
This document is prepared with the assistance of Specialist Editor Stephen Newman, Executive Counsel, Ponte Earle.