The constitutional structure of many companies tends to be overlooked but can be fundamental to the smooth running of the business.

Do you know what would happen if one of your co-shareholders wanted to sell their shares?  What if a third party makes an offer to buy the business?  What happens if the business becomes insolvent?  What if the shareholders just can't agree on the future of the company?

Our experienced lawyers will discuss these and many other issues with you and produce Articles of Association tailored to your requirements.  These should strike the right balance between founders/majority shareholders and minority shareholders.  It may be appropriate to back the Articles up with a separate contract (a shareholders' agreement) between some or all of the shareholders.

The Companies Act 2006 implemented a number of changes to reduce the administrative burden for private limited companies.  We can advise you how to take advantage of these new procedures and, if your company has pre-October 2008 Articles, some simple changes will bring them up to date.

For most private limited companies owned by two or more shareholders the Articles of Association should be upgraded from those the company was incorporated with to include:-

  • permitted transfer provisions;
  • pre-emption rights and appropriate triggers to their application;
  • drag-along clauses; and
  • accelerated procedures for the addition and removal of directors.

For more sophisticated structures different classes of shares may be used, in particular with 50-50 joint venture companies.