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- Partnerships and Shareholder Protection
- Partnerships
- Shareholders agreement and shareholder protection
- Limited Liability Partnerships (LLPs)
Partnerships
A partnership often offers the opportunity for like minded people to pool their resources in search of a common goal. However, under English law a partnership can be formed with little formality. This may appear attractive but it could leave the partners in a position where the partnership does not suit their individual needs. For example, the distribution of profit and/or liabilities would be governed by partnership law and may not be distributed in the way the partners would have desired. One way to avoid this result and the uncertainty it creates is to draw up a partnership agreement. We can ensure the agreement meets your personal needs as well as your business' commercial requirements.
The Limited Liability Partnership Act 2000 introduced the ability to mitigate personal liability in partnership structures. We are seeing more and more clients opt for this more formal structure so that personal assets are protected from a down turn in business fortunes.
Shareholders’ agreements and shareholder protection
Shareholders in a company are rarely completely satisfied with the protections the law affords to them, especially if the shareholder is in a minority. It is essential that the shareholders of a company make the adjustments they feel are necessary to strike the balance they desire through a shareholders’ agreement. A shareholders’ agreement is essentially a contract between the members of a company to act and conduct themselves in an agreed manner.
It is also essential to consider the protections shareholders require to preserve the value of their individual shareholding both during their lifetime and for the benefit of their families after death. We work closely with many IFAs to ensure that funds are available on death (or critical illness) to ensure a solicitor acquires the deceased’s shares and the grieving family receives much needed cash during difficult times.
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