If you are running a business with others then Shareholders & Partnership Agreements are a must.
A Partnership Agreement is required when you are trading as individuals and a Shareholder Agreement when you are trading through a limited company. The hybrid model of an LLP which is common in professional services requires a Members Agreement.
A Shareholders Agreement is used in tandem with the Articles of Association of the Company to specifically manage the way that shareholders act and the internal processes and governance of the company.
Shareholder Agreements and Partnership Agreements are particularly important if something were to go wrong with the business or disputes were to arise. At this stage, those concerned may be at logger-heads and need to find a resolution to the conflict or exit.
Shareholder & Partnership Agreements for family-run businesses
You may worry that formalising family arrangements would feel like overkill, or might damage the ‘family’ culture of the business. However, for these businesses, Agreements of this nature are probably even more important. Many business matters may not have been properly discussed or understood and such an Agreement creates an opportunity for discussion.