The shareholders’ agreement
In a shareholders’ agreement, a lawyer lays down arrangements between shareholders, as in a contract. When a company consists of one shareholder, it is not yet necessary to draw up a shareholders’ agreement. However, when a new shareholder joins the company, interests change and clear arrangements are necessary. A shareholders’ agreement is of great value to a business or private limited company to prevent a conflict in the future. You should therefore not put off drawing up an agreement and you should engage an experienced lawyer for this. A lawyer can also assess an existing shareholders’ agreement if you have doubts about its content.
A shareholders’ agreement is not public
Since agreements are so important, the company’s articles of association serve to protect shareholders. The entrepreneurs can fall back on them if there is no shareholders’ agreement. The articles of association contain several important agreements for shareholders. What is seen as a disadvantage by many shareholders is that these articles of association are public. This is not the case with a shareholders’ agreement; these are not public. The articles of association can be requested from the Chamber of Commerce. The shareholders’ agreement may contain arrangements that contradict these articles of association; it will be a unique contract for each collaboration. Shareholders can circumvent the established rules and laws. A lawyer knows exactly what is possible when drawing up the agreement. After all, it is quite conceivable that shareholders want to determine their own rules regarding decision-making, termination of collaboration, shares and disputes. The arrangements in an agreement between shareholders are therefore often more concise than in the company’s articles of association.
Drawing up a shareholder’ agreement
Several factors must be taken into account when drawing up a shareholders’ agreement. Naturally, every company is different, but every shareholder is also unique. In addition, joining a private limited company is an important step and every shareholder will cast a critical eye over the content of the shareholders’ agreement. Drawing up a shareholders’ agreement therefore differs from company to company and a lawyer will have to listen carefully to everyone’s wishes before drawing one up.
Content of a shareholders’ agreement
Elements that must be established by the lawyer in a shareholders’ agreement:
- an exit arrangement;
- valuation basis of the shares;
- which shareholder resolutions require a larger majority than usual;
- which board resolutions require shareholder approval;
- tag-along / drag-along arrangements: in the event of a sale of shares by a shareholder, the other shareholders may or must also sell at the same price;
- cases other than a dispute or breach of contract in which the shares must be offered;
- purchase obligation: shares offered to other shareholders must be taken over in certain situations. For example, if the shareholder dies;
- confidentiality clause;
- non-competition and non-solicitation clause;
- profit distribution;
- perpetual clause for successive and acceding shareholders.
The importance of an agreement
It is imperative these subjects are arranged. It is not easy to get rid of another shareholder in a conflict situation. That is why exit arrangements are often included in these types of agreements. Other agreements and general terms and conditions should also be drawn up immediately.
An experienced lawyer
A lawyer knows what needs to be arranged, what you can and cannot agree to and what the consequences are of certain arrangements. Fruytier’s lawyers specialize in business law and have extensive experience in drawing up agreements and general terms and conditions and can assist you with this. For no-obligation information, please contact us on +31(0) 205 210 130 or fill in the form below to find out more about our services.« Back to business law