What is meant by private equity? Private equity (PE) describes professional investment into a privately held company, usually one limited by shares. Depending on the stage in the business lifecycle that the company is in, and the risks of investing … [Continue reading]
What Is A Shareholders’ Agreement?
A shareholders’ agreement is a contract between the owners of the shares of a company. Its purposes are to protect the value of each owner’s investment, to regulate a fair relationship between them and to control the management and strategic … [Continue reading]
Why You Should Avoid 50:50 Shareholdings
When a business started by two people is incorporated into a company, the founders often split the shares 50:50 because it seems “fair” to do so. At an early stage in the life of the business both founders may have contributed to it equally in terms … [Continue reading]
Control Of Decision Making By Shareholders
One of the functions of a shareholders agreement is to set out clearly the differentiation in roles between shareholders and directors. Shareholders are not responsible for the day to day running of the company, but will want say on decisions that … [Continue reading]
Cross Options, Life Insurance And Inheritance Tax
A shareholders’ agreement is as much about planning for future misfortunate events as it is about control of the business today. Misfortunate events Events such as death, incapacity, bankruptcy or insolvency can change ownership, and in doing so, … [Continue reading]