If there is no formal, written shareholders’ agreement, then the relationship between shareholders and their company is regulated by the company’s Articles of Association.

A written agreement negotiated between all shareholders is the best way to ensure everyone is covered adequately, and know their rights and obligations.

A shareholders’ agreement, which is a private document, provides that extra clarity.

We will help you consider the important terms and aspects when drafting a shareholders’ agreement, including:

  • Voting rights of minority or majority shareholders
  • Transfer of shares between shareholders or groups of permitted transferees (e.g. spouses, children)
  • Exit terms
  • Termination of the shareholders’ agreement and what happens in the event of bankruptcy or death of shareholders
  • The valuation of shares on a transfer
  • Rights of the shareholders to receive additional shares
  • Rights of specific shareholders to purchase additional shares or sell shares on the triggering of certain events or achieving certain conditions

Because of the complexities of drafting a comprehensive shareholders’ agreement, appropriate advice is a must.

In most cases having a shareholders’ agreement is a far more cost-effective approach to heading off disputes before they occur. Director or shareholder dispute resolutions are much more difficult and expensive to achieve if there is no contract in place. If it does go so far as a formal dispute, we can help you out with this as well.

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Get in touch with our team of Shareholders & Partnerships experts today to discuss your requirements. You can contact us via email Email or telephone us 01803 213251

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