Conflicts are inevitable in the corporate environment, particularly in family-owned companies, where family members must coexist and collaborate. The founders´ apprehension about preserving the principles and values built over the years for future generations, disagreements about succession and personal interests can lead to conflicts and, consequently, compromise the performance and even the continuity of the business.
In this scenario, a shareholders´ agreement can be a strategic and effective tool to address and mitigate these issues. It is a parasocial instrument entered by the shareholders of a company, who seek to establish clear rules about governance and mechanisms for preventing and resolving potential conflicts that are not (or should not be) detailed in the articles of incorporation.
For family-owned companies, it is crucial that the shareholders´ agreement includes specific clauses tailored to the unique needs of the company and its members. Among these, the corporate governance and management section that regulates the organization of the company´s governing bodies – such as the shareholders´ meeting, board of directors and the executive board. It establishes rules for convening procedures, quorum, decision-making and main aspects of the operation of the business.
Another essential section concerns the transfer of shares (or quotas). This section regulates the transfer of the corporate shares (or quotas) and the right of first refusal and/or offer ensuring that existing shareholders have the first opportunity to acquire them before they are acquired by and/or offered to third parties.
The encumbrance of quotas section is equally important. This clause ensures that corporate shares (or quotas) remain free from liens or encumbrances. If an encumbrance is imposed, such as a judicial order, the shareholders can establish specific measures for their release.
Regarding the right of withdrawal section, the shareholders’ agreement should establish clear rules for the possible exit of a shareholder, including the requirement to notify other shareholders. It also outlines procedures for evaluating corporate shares (or quotas) and calculating and paying withdrawing shareholder’s dues, ensuring fair compensation.
Additionally, the profit allocation section should regulate profit allocation, reinvestment, and the creation of a reserve fund to promote the company’s financial sustainability.
Regarding the family-owned companies, the succession clause is indispensable as it clearly defines the conditions for admission or not of heirs and other successors in the company. It is important to note that this clause has limits and does not substitute a last will and testament, but can impose rules for the admission of new shareholders.
Other important clauses include the non-compete and non-solicitation section, which prevents shareholders from competing with the company’s business or soliciting employees and other collaborators, clarifying such limits, as well as the confidentiality clause, which reminds shareholders to maintain confidentiality regarding important business information even after their exit from the company.
In conclusion, a shareholders’ agreement structured with these essential clauses and other tailored sections is a fundamental tool for preventing conflicts, thereby contributing to the stability and success of family businesses.