The expression “Shareholders’ Agreement” is usually referring to written agreement between shareholders of a company or the partners of a business.  The agreement usually covers the structure, funding arrangements, management arrangements, key policy issues and often incorporates many other important clauses, including clauses defining:

• The process to be followed to resolve disputes between shareholders/partners;
• The process to be followed upon the death or total disablement of a shareholder/partner (often referred to as Buy/Sell arrangements) ;

The terms are intended to outline the responsibilities and obligations of the business owners. By determining in advance how the issues that may arise during the life of a business are to be dealt with usually save considerable expense and reduces the anxiety when foreseen circumstances arise.

Next month we will provide a checklist identifying the important issues to be included in shareholders agreements.

If there is a dispute between shareholders of a company the outcome can be very uncertain in the absence of a predetermined process.  The options available for shareholders when a dispute arises are summarised in the article below.

Next month we will summarise the options available for partners when a dispute arises in a partnership.

Contact our Business Advisory Lawyers for further information. 

James Frank - jfrank@franklegal.com.au 

Andrew Graham - agraham@franklegal.com.au 

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