shareholders agreement

Shareholders Agreement – Indispensable In Business

Are you in a joint venture with friends?  If you’re running a business with your trusted friends or colleagues, you’re probably worried you haven’t got anything in writing to seal that trust – a shareholders agreement. As a shrewd business owner you would want to ensure your company runs smoothly, with the power of vote exercised against every executive decision. Do you think that a handshake among friends should suffice?  Think again!  You must have a shareholders agreement in place to protect your rights.

Why Is A Shareholders Agreement Indispensable In Business?

A partnership can only run smoothly and successfully with a shareholders agreement that’s been prepared by an experienced business owner and corporate lawyer.  No doubt you’ve seen the need to decide, for instance, how disputes should be settled and a means by which no conflicts will surface.  But an essential aspect of running a business is knowing exactly the value of the company and the value of your own slice of the cake, thus maximizing the value of your business investments.

Be Proactive In Protecting Your Venture

selling company shares

When you’re proactive in protecting your business, you’re not just protecting your interests, you’re also protecting those of others.  With a shareholders agreement, everyone is protected.  Consider for instance, if in future someone decides to leave the company, conflicts will surface and will not be resolved with a simple handshake – you can shake hands when agreeing on a partnership, but parting companies isn’t as easy as a handshake. Even if you have in place a document that covers many aspects of a shareholders agreement, it is highly recommended that you instruct a corporate lawyer to review it and insert overlooked and yet essential key points. For instance, without a non-compete clause in a shareholders agreement, the leaver can effectively and lawfully take the business with them.

Shareholders Agreement – Investment Protection

Every shrewd business owner stretches the investment and profits of their business with a shareholders agreement in place, thus preventing conflict with the shareholders of the company. So, whether you choose to leave or remain with the company, as a shareholder you can decide to:

shareholders agreement

  • leave the company and keep your shares until you’re ready to sell
  • leave the company and sell your shares back to the company
  • leave the company and sell your shares to an external investor
  • leave the company and sell your shares to an employee
  • sell your shares to another shareholder and remain with the company

How Much Are Your Shares Worth?

The options are numerous and the shareholders agreement will help you decide which option is in the best interest of your investment.  A shareholders agreement is pivotal when protecting of your business assets.  When drafting an agreement and before it is counter-signed, be sure to know how much your shares are worth and how much it is due to you once you leave or decide to cut your share out of the cake. Your shareholders agreement needs to be clear about all finances so everyone knows what they are due.

Consider All Key Aspects Of Your Business

At DG Law we will help you ensure that your shareholders agreement is approved and signed by all shareholders, and that it is kept in a safe place where it can be easily accessed.  We will help you understand that a shareholders agreement is like a prenuptial agreement, setting out what the position is when the partnership is formed and what will take place, without nasty surprises or disputes, when the relationship dissolves.  We will help you consider key aspects of your business, including:

  • Confidentialityshareholders agreement
  • Intellectual property protection
  • Administration
  • Officers
  • Management
  • Who should be involved in decision-making
  • How profit should be distributed
  • Who is responsible for what
  • What can be achieved from an agreement between the shareholders

Please call us today to arrange an informal telephone discussion with one of our business lawyers.  We can discuss how your shareholders agreement should be clear and concise, how it can protect your investments, how it will allow the management team and decision-makers to know where they stand, when faced with a complex issue.

Make An Enquiry

Call us now on 07855 849232 or complete a Free Online Enquiry and we will be delighted to talk with you about your legal matter.

Free Enquiry

Make An Enquiry

    Global Excellance Awards

    Client Reviews

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

    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

    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 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