110 The need for restrictions on board and shareholders’ decisions

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BUSINESSES vol 4(2) start-up, sale and purchase

110 The need for restrictions on board and shareholders’ decisions

Copyright © 2025 LexisNexis

| Commentary

(e) Decisions of the board and shareholders’ meetings

The regime under the Companies Act 2006 and standard company articles leaves minority shareholders very vulnerable to unwelcome decisions of the majority. Board decisions, even those of fundamental importance to the company’s business, are usually made by a majority and

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(1) START-UP

111.1 Restrictions which should be accepted by the shareholders alone

111.2 General running of the business

111.3 Financial policy

111.4 Transactions involving directors, employees and consultants

111.5 Litigation

112 Ensuring that the shareholders have adequate information to make decisions

113 The need for deadlock provisions

114 The aim of deadlock provisions

115.1 When the deadlock provisions are to apply

115.2 Third-party references

115.3 Escalation clauses

115.4 Russian roulette

115.5 Winding up of the company

116 Damages, specific performance and injunctions

117 Termination of the shareholders’ agreement for breach etc

118 Dispute resolution

119 The need for restrictions on transfer

120.1 The transfer notice

120.2 Valuation of the shares

120.3 Notification and offers