Company Shares – Covid-19 Lockdown

shareholders agreement

COVID-19 has severely affected the economy. The significant economic uncertainty has affected business owners and partnerships. This calamitous situation has negatively impacted on staff, whether furlough has been enforced or if they have been laid off, or even if they are working and still on payroll, the uncertainty has affected absolutely everyone.

The government has promised to assist businesses in the UK in order to survive this catastrophic phase in our history. But still directors, officers and shareholders may be liable if they breach duties relating to care, diligence, and don’t act in the best interests of the company and staff. As hard as this may sound, shareholders are still under obligation towards their staff and the business.

We understand that it’s hard to make decisions, especially so swiftly as the coronavirus has struck so swiftly and the lockdown happened almost overnight. We have had to deal with reduced dividends or complete loss of business. But these decisions may impact on both staff and shareholders quite harshly. There are new laws and regulations to protect business owners at present. For instance, landlords cannot evict tenants because it was the government’s decision to shut the doors of non-essential shops, cafes, bars and restaurants.

One scenario shareholders may find themselves in, is challenging the competency of leadership. A shift in leadership could potentially raise disputes amongst the shareholders. Disputes such as contested share value may arise, leading to litigation cases. Some shareholders could exercise their right to buy or sell shares, which is a right incorporated in the shareholders agreement but this could also give way to litigation.

If you are concerned with what is covered in your company’s shareholders agreement and if you are covered for any eventuality, please give us a call. We’d like to hear from anyone concerned about the present situation and what rights they have in relation to their company’s shareholders agreement. SG

Make An Enquiry

Call us now on 020 7113 4003 or complete our Online Enquiry and we will be delighted to talk with you about your legal matter.

Free Enquiry

Back to all news

Share Article With:

Make An Enquiry

Global Excellance Awards

Client Reviews

DG Law were fantastic throughout our purchase process. We had a short, fixed, timeline to

Venetia Lawson-Cruttenden [solicitor] is fantastic!  She is always so thorough and efficient and gives you the

DG Law supported us through a very difficult contractual negotiation to achieve exactly the outcome

We were very pleased with the way that DG Law helped us on our transaction

Thanks for all the help from DG Law in pulling together our somewhat complicated loan. 

DG Law resolved a difficult lease renewal for us and their services were excellent –

I needed understanding and experienced legal advice. DG Law provided an excellent service at a

My experience was second to none – the service was professional and personal. DG Law

DG Law always step up to the plate on our transactions and handle the various

DG Law was recommended to me and my partner and I received excellent advice –

Having worked with DG Law a number/couple of times now, I have been really impressed

DG Law were constantly at hand, and kept pro-active throughout the thorny process of getting

DG Law organised and ran a very useful session to help to make our team’s

DG Law came recommended to me and whilst setting up a new business it was

We were recommended three lawyers to handle the sale of our seven year old successful

Why Choose Us?

We live by our core values of transparency, flexibility and being honourable – every day

We put ourselves in your shoes so we understand your problems from the inside out

We deliver our advice in a way that is easy to understand