Shareholder agreements set out the framework for ownership, decision-making and the rights of each shareholder. We tailor these agreements to reflect the needs of your business and the relationships between those involved - helping you prevent disputes, protect investments and support long-term stability.

At Walker Foster, we work closely with you to create agreements that reflect how your business operates and how its ownership should be managed. Our approach to drafting shareholder agreements is detailed, transparent and designed to prevent future problems - providing clarity, structure and peace of mind for all parties involved.

Can I write my own shareholder agreement?

While it is legally possible to draft your own shareholder agreement, doing so carries significant risks. Off-the-shelf templates and self-drafted documents often fail to reflect the specific needs of your business, overlook important protections, or create conflicts with existing company documents such as the Articles of Association.

A professionally drafted, comprehensive shareholder agreement does more than record decisions between shareholders - it helps detail compliance with complex and evolving legal requirements. Without the right legal expertise, it’s easy to overlook critical regulatory obligations or unintentionally create conflicts with company law or existing corporate documents such as the Articles of Association.

Mistakes in drafting or applying a shareholder agreement can lead to unintended tax consequences, breaches of director duties or unenforceable provisions. Poorly worded clauses may be open to misinterpretation, or fail to stand up under legal challenge. What appears straightforward on paper can quickly become problematic if the agreement hasn't been prepared with precision and foresight.

At Walker Foster, we understand the challenges businesses face in navigating these risks. Our shareholder agreement solicitors stay up to date with legal developments and draft agreements that are not only tailored to your specific circumstances, but also fully compliant with current company law. We make sure your agreement works in practice as well as in principle - offering long-term protection, reducing the risk of dispute and supporting the smooth governance of your company.

What happens if a shareholder agreement is breached?

A breach of shareholder agreements can cause serious disruption to the business and its management, particularly where trust has broken down or key terms have been ignored. The consequences will depend on the terms set out in the agreement, but affected shareholders may be entitled to seek compensation or take steps to enforce the agreement - such as initiating a compulsory share transfer, suspending certain rights or pursuing other agreed remedies. 

If a shareholder agreement has been breached, Walker Foster’s experienced dispute resolution solicitors are here to protect your interests and help secure the best possible outcome for you and your stake in the business. We will guide you through your rights, explore all available options, and take decisive action to resolve the dispute efficiently and effectively, with your long-term position and commercial priorities at the heart of everything we do.

How do I get out of a shareholder’s agreement?

Leaving a shareholder agreement can be done, but it depends on the terms of the agreement and the circumstances. In many cases, shareholders may agree to end or amend the agreement by mutual consent. Alternatively, you might exit by selling your shares, subject to any restrictions set out in the agreement. If there has been a breach of the terms by another party, this could also give grounds to terminate or renegotiate your involvement. Our shareholder agreements lawyers can review your position and advise on the most appropriate and lawful way forward.

What are restrictive covenants?

Restrictive covenants are clauses in a shareholder agreement that set boundaries on what a departing shareholder can do after their exit. They are used to protect the business and the interests of remaining shareholders - typically by preventing the individual from setting up or joining a competing business, approaching clients or suppliers, or using intellectual property or sensitive information gained during their time with the company.

Walker Foster can draft clear, enforceable restrictive covenants that protect the interests of existing shareholders and the long-term stability of your company. These provisions are tailored to your specific business needs and can help prevent departing shareholders from undermining the business by competing, soliciting clients or disclosing confidential information.