Share Agreement

[Stangirl]

It may seem a little odd to ask this on Mumsnet but my business has been created with someone I met on here and for the last 5 years it is the forum I've always turned to for advice.

I am incorporating my business and creating two partners with a share agreement. I don;t want to pay £5k for a lawyer to draw up the agreement and have a corporate lawyer friend who will check it through for me. I am trying to find a basic outline one to base ours on but everything I can find comes with a charge and there;s no guarantee it will be the "right" format and so I will have wasted money.

Does anyone on here have an example of a basic share agreement they can share with me or advice to give?

They are quite difficult to have a model form of. I have a few but I would not want to get sued by sending them (yes we lawyers can be sued £20m+ even just for work we do for nothing!). They are all very specific to a certain deal. At the very least do have something in writing. I make a lot more money when shareholders end up in dispute and going to court than I do spending a few hours doing a shareholder agreement which by the way if a client puts into my examples their own names, addresses, % shareholdings and other points is more likely to cost £500 plus VAT for me to do a quick check than the £5000 you seem to be being quoted.

Your first issue is if you will have 50% of the shares each.

Also did you know the Government has started a series of measures against people who trade through companies including higher tax on dividends. Although it is very sensible to avoid liability by incorporating the tax advantages may be going to be chipped away with. Either way you need an agreement however even if you stayed in partnership. In fact if you have a partnership and any existing terms at all the solicitor should look at that too to see if anything in there needs to be incoporated. If you have 50/50 each neither can sack the other as a director so you might well want some third party or arbitration provision in case of disputes.

Why not just ask your corporate lawyer friend? If he / she is practising will surely have access to a bank of styles? Or ask your friend to do the agreement for you at reduced rates or something.

Failong that you could ask another firm for a quote. You might find someone who will do it more cheaply. Do make sure you go to someone who knows something about company law though.

Thank you for your advice.

It's an 80/20 split and the 20% shareholder will not be a registered Director.

A friend's friend is advising so I found a solution.