A shareholders agreement is fundamentally important to your business. There are numerous issues that can arise that can give rise to serious disputes between shareholders and more often than not, shareholder disputes can jeopardise the entire business. It is also vital that a shareholders agreement is concluded in conjuction with the Memorandum of Incorporation for the Company, particularly as the Companies Act 2008 provides that in relation to certain vital aspects a Memorandum of Incorporation will override and take precedence over a shareholders agreement.
Profit incentive policies are often undocumented and this can lead to serious disputes down the line. These disputes can include the manner of calculation of the incentive scheme, or (for example) the taxation related aspects. We strongly recommend that a written profit incentive policy is put in place.
If an agent is appointed to sell a business, you would typically want to provide for a written mandate that regulates the terms and conditions that apply, the obligations of the agent and the remuneration mechanism.