Create a flawless shareholder agreement
You can get the legalities taken off your plate with the support of Optimal Solicitors. Our legal advice will guarantee that you know what you’re creating or signing, minimising the risk of things going wrong later down the line.
With our years’ of expertise, you can move forward with confidence knowing you’ll put an effective shareholders’ agreement in place for your company - now and for the future.
Put a robust shareholder agreement in place with Optimal Solicitors
Our shareholders’ agreement solicitors have years of experience in this area. We’ve advised a number of clients on this matter, and made sure that their rights were protected, and tailored our services to their requirements.
Why choose Optimal Solicitors?
- Competitive costs – We provide our services at the lowest cost possible, as well as outline exactly how we’ll help you during a free initial consultation.
- Accessible advice – We remove the jargon from legal guidance, and replace it with straightforward language that makes sense to anyone and everyone.
- Convenience – We are truly flexible. From our opening hours to our methods of communication, we guarantee that we adapt to your needs.
Our shareholders’ agreement solicitors are more than happy to put together not only the agreement itself, but also the articles of association if you require them. Through us, you can avoid shareholder disputes, and make sure that any breaches of contract will be effectively handled. To get started, all you need to do is contact our team
Shareholder agreement solicitors in the UK – get in touch
Shareholder agreement solicitors
What is a shareholders’ agreement?
When is a shareholders’ agreement used?
When should a shareholders’ agreement be put in place?
- Clearly establish the rights of each shareholder
- Manage the mandatory transfer of shares
- Make sure that shareholders can’t prevent the sale of the business
- Strengthen the power and protection of minority shareholders
- Have an effective dispute resolution process
- Govern the management of the company
- Link shareholding to employment
- Have privacy around how the business operates (as there is no need to file it with Companies House)
Why have shareholders’ agreements?
An agreement makes it perfectly clear what rights shareholders have, how equity and shares are issued, and how disputes are settled. On top of this, the process of negotiating the contract itself allows each shareholder to better understand the aims and direction of other stakeholders, as well as the business as a whole.
What different types of shareholder agreements are there?
What happens when a shareholders’ agreement is breached?
- The innocent party has the option to either end or affirm the agreement.
- Damages can potentially be regained by the innocent party if they’ve experienced a loss due to the breach. However, it’s important to note that these can be difficult to quantify.
- A court order may be potentially granted in order to make the party who has broken the agreement perform as stated in the agreement.
- An injunction can be pursued by the innocent party to prevent a threatened breach from taking place.
Protecting the rights of a shareholder
How does a shareholders’ agreement help a minority shareholder?
Plus, there is often a ‘tag-along right’ in these contracts. This entitles the minority shareholder to prohibit the sale of a 50.1% interest – unless a like offer has first been made for the 49.9% interest.
If there is no legal obligation, why should we have a shareholders’ agreement?
Why is legal advice important in the shareholder agreement?
Do I really need a shareholders’ agreement?
What problems can arise if you don’t have a shareholders’ agreement?
- Minority shareholders could prevent the company’s sale.
- Employees or directors who own shares could leave the business and still own their shares, reducing the profits for the shareholders that remain.
- Departing shareholders could take all the knowledge, customers, and trade gained with them – putting them in a good position to set up a viable competing business.
- If there are only two people or companies and they have equal voting shares, a deadlock could potentially happen if they can’t come to an agreement. Without the shareholder contract in place, neither party would have control of the business.
Important clauses in a shareholder agreement
- Circumstances in which unanimity for important decisions is necessary
- Shareholding limitations, including when the transfer of share would be
- forbidden, the procedure for transfer, and how to work out the fair value
- Any disagreement that should involve alternative dispute resolution rather than court proceedings
- Enter and exit strategy for shareholders – like buy-out rights (or against) specific members
- How to settle deadlock situations – this includes a dedicated decision-making process to make sure that these can be dealt with effectively
What makes shareholder agreements complete?
- Duration of the agreement
- Company structure – this includes how the share capital is split, and classes of shares for each shareholder
- Types of shares
- Shareholders’ rights to the type and percentage of shares they own
- How dividends are divided
- Shareholders’ voting rights
- Actions which need the approval of shareholders first