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Shareholders Agreement Material Breach

Throughout the day gives minority shareholders the right, with the agreement of majority shareholders and the sale of their shares at the same price and conditions. It is an excellent tool for minority shareholders to ensure that their interests are not devalued when the potential acquirer acquires a majority stake. A breach of the shareholders` agreement may occur due to a number of circumstances, but it actually occurs when action contrary to the terms of the agreement is taken. This could be the case when a shareholder decides to sell some of the most important assets of a company without proper authorization or if shares are transferred in a manner contrary to the rules established in the shareholders` pact. An infringement may also occur if the entity makes a decision without the required majority of shareholders. Other areas that often lead to an infringement are the company`s dividend policy or the breach of confidentiality obligations contained in the agreement. Any dispute arising from the violation of a shareholders` pact is related to different facts. Blackstone solicitors have extensive experience in verifying and preparing such agreements, as well as in all types of rights arising from these agreements. For a free and non-binding first discussion, contact our lawyers on 0161 929 0121 or email, and a member of our team will be available. A breach of the shareholders` agreement (i.e. non-compliance with the terms of the contract) may occur for a number of reasons and may occur in different circumstances. Shareholders may violate the agreement by making a decision either without the required majority vote, or by the sale or transfer of assets or shares, without respecting the terms of the shareholders` agreement. What`s the problem? They didn`t think it was worth making a shareholder pact when they started the company because they were such good friends and they wanted to save costs.

A shareholders` pact is an agreement that imposes the nature of the relationship between two or more shareholders of a limited company. They are agreed between shareholders and, as a rule, the company and may cover topics such as restrictions on the sale of shares, restrictions on the issuance of new shares or the rights of shareholders to appoint a director of the company.