Ending of Shareholder Arrangements

February 2016

Building on our January Corporate offering of Share Investment Agreements, it will usually be the case that when an investor decides to invest in a company, a new shareholders’ agreement will need to be drawn up. This will, by definition then require the termination of the company’s existing shareholders’ agreement. Some shareholders may choose to leave the company at this point or all may wish to stay as shareholders in the company, but whatever the arrangement, a new agreement will necessitate the termination of whatever existing arrangement there is.

We have therefore created a short form and user friendly Deed of Termination specifically designed to cater for the ending of an existing shareholding arrangement. This template has been drafted as a deed in order to overcome any potential problems of lack of consideration. All parties to the original agreement will need to be parties to the termination agreement. This agreement provides a neat and easy way for shareholders to end their existing relationship before embarking on a new arrangement.

This new template will be of interest to directors and shareholders of small private companies as well as to potential investors.

The contents of this Newsletter are for reference purposes only and do not constitute legal advice. Independent legal advice should be sought in relation to any specific legal matter.

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