Shareholder Agreements Solicitors, Malton, York & Wetherby
Shareholder agreements are commonplace in large corporations. When it comes to small, private or family-owned businesses, it is often the case that informal decision-making processes are used. When those who are involved in running a business have a close personal relationship, it may be seen as unnecessary to put in place shareholder agreements – after all, everyone is working towards a common goal. However, if problems do arise, having a formal agreement to refer back to can be hugely beneficial in protecting your business and your relationships with other shareholders.
The Commercial Team at Pearsons & Wardare experts when it comes to advising on such matters. For many years, our Yorkshire-based lawyers have worked with businesses of all sizes to identify and provide solutions in a diverse range of commercial contexts.
We can provide advice and support on matters such as:
- Drafting shareholder agreements
- Voting rights
- Transfer of shares
- Dividend policies
- Shareholders' rights
- Valuation of shares
- Minority shareholder protection
What is a shareholder agreement?
A shareholder agreement is a legally binding agreement between the shareholders of a company. It sets out the rights and obligations of shareholders and regulates how they perform their role. This includes matters such as how and when they can acquire and sell their shares, how important decisions concerning the company will be made, as well as details about how the company will be run. Shareholder agreements are not a legal requirement for companies, but in many cases will offer substantial benefits to the business as a whole. Unlike the articles of association, shareholder agreements are private. They do not need to be filed at Companies House and, as such, cannot be read by the public.
What are the benefits of having a shareholder agreement in place?
Each share in a company carries a certain degree of power – it is crucial that this authority is regulated and managed appropriately. Every company is different so having a means of control that suits your specific needs and commercial ambitions is essential in promoting growth and success.
Amongst other benefits, shareholder agreements can result in:
- Improved dispute resolution – arrangements are put in place to resolve disputes if they should arise between two or more parties with equal shareholdings
- Enhanced protection for minority shareholders – this can make businesses more attractive to outside investors
- Additional control over the transfer of shares if a shareholder leaves or dies
- Regulated and systemised management of the company
- Lower administration costs once an agreement is in place
Contact our Commercial Team in Yorkshire
The shareholder agreement lawyers at Pearsons & Wardare available to discuss all matters relating to your shareholder agreement. The Commercial team at Ware and Kay are available to discuss all matters relating to your shareholder agreement and to work with you to put in place appropriate agreements to give you peace of mind should issues arise in the life of the Company.