Another concern is where a minority shareholder could transfer their shares to anyone. This could create problems for other shareholders, especially when the sale takes place to a competitor or other person that the other shareholders do not wish to associate with the company. But conversely, forcing an unhappy shareholder to stay can cause more problems than having a new unknown shareholder interested in the company`s success. All shareholders must agree for business to prosper. To overcome these problems, shareholder agreements often contain rules relating to the sale and transfer of shares – to whom shares can be transferred, under what conditions and at what price. The subscription and shareholding contract has been designed to be signed as this contract that avoids the execution formalities necessary for the act. This approach is usually supported by the lawyer`s opinion (available here) with the cavee that one should always get specific legal advice for each situation. As a rule, it is better to conclude a shareholders` agreement when creating the company and issue the first shares. In fact, it can be a positive exercise to ensure that there is a common understanding of shareholders` expectations of the company.
At this stage, shareholders should, as far as possible, have a similar opinion on what they expect and receive from the company. If the differences between investors are too strong at this stage to constitute a shareholders` agreement, it will no doubt warn that warning bells about the nature of their future employment relationship will ring. A minority shareholder might want a provision that, if someone agrees to buy the shares of a controlling shareholder, a shareholder can only sell the shares if the same offer is made to all shareholders, including minority shareholders. This is often referred to as the “Tag Along” layout. The goal is to ensure that minority shareholders get the same return on their investment as other shareholders. As a minority shareholder and with a shareholders` agreement that requires all shareholders to approve certain decisions, make sure you have a say in important decisions that affect the company. . . .