One missing agreement, one stalled buyback, and a $222,500 order
A Queensland court has ordered a company to honour a share buyback promise made to a senior executive more than three decades ago.
When Greg Johnston retired in July 2019, after more than 44 years with Aquatec Maxcon Group Ltd — serving as its managing director since 1985 — he expected a clean exit. In 1989, as part of a management buyout, Johnston and other senior staff had signed a deed with 202 Ltd, the company's ultimate holding company. They each purchased shares in Aquatec, and 202 Ltd undertook to use its best efforts to buy those shares back at a set per-share value based on the company's annual accounts when staff resigned after at least five years. It was, in the words of Johnston's counsel, an arrangement that "incentivised the senior staff to continue working for Aquatec on the promise that something of real value would be provided in return."
Johnston held up his end. He turned down other job opportunities over the years, partly because he believed the buyback would be there when the time came.
202 Ltd did initially follow through. In August 2019, it purchased 300,000 of Johnston's shares at $4.45 per share, totalling $1,335,000. But when Johnston came back for the remaining 50,000 shares in July 2020, the company stalled. By early 2021, it had refused outright. Johnston took the matter to court in October 2021.
Then things got complicated. After the litigation began, 202 Ltd found a second...
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