Shareholder Agreements
OUR SHAREHOLDER AGREEMENTS SERVICE
Being a minority shareholder in a company without the protection of a shareholders’ agreement puts you in a very vulnerable position. A shareholders’ agreement is a contract setting out the terms on which two or more people are involved in a business as directors and/or shareholders. It supplements the company’s articles of association and is essential to protect the position of anyone who is not the majority shareholder in the company. Without such an agreement, a company is under the control of those who hold a majority of the votes at a directors’ or shareholders’ meeting. Majority decisions are all very well for day to day matters, but where something goes to the heart of running the company, or materially affects the interests of individual shareholders, most shareholders want to have their say. A shareholders’ agreement can specify decisions which require all, or certain shareholders to agree. Shareholder agreements vary, but the typical agreement is designed to protect all the parties against a majority using their voting power to the detriment of the others.
CONTACT US TODAY
WHY HAVING A SHAREHOLDER AGREEMENTS SERVICE
When setting up a company with family, friends, or other professionals you have known for a long time, it is very easy to assume that nothing can go wrong in the future. You trust one another and therefore you probably assume that you don’t need to think about putting any protections in place in case things do go wrong. You also might feel a little uncomfortable suggesting that your new business partners enter into a shareholder agreement.
Hopefully nothing will go wrong BUT friends, family and business partners do fall out. If you do not seek to protect yourself, you could lose out or even end up involved in costly litigation.