Fifty-Fifty Shareholder Dynamics

Contact Neufeld Legal PC at 403-400-4092 / 905-616-8864 or Chris@NeufeldLegal.com

Being fifty-fifty shareholders creates its own set of legal dynamics that need to be appropriately addressed. For in a fifty-fifty scenario there is a presumptive stalemate at all times. There is also no clear way to break a deadlock.

As such, it is imperative that fifty-fifty shareholders enter into an appropriate legal agreement to control and direct their business operations and enable functional exit strategies too be pursued irrespective of the two shareholders having an equal number of shares. For without such means to advance the company and overcome the otherwise effective deadlock, the shareholders may well find themselves unwilling to make the necessary commitment and effort to optimizing the success of the company.

What a unanimous shareholders agreement offers fifty-fifty shareholders is the ability to overcome the mathematical impasse that is created by having an equal number of shares . The agreement should be fairly negotiated, yet it also needs to protect the interests of each of the shareholders while advancing the objective interests of the business. It is therefore an invaluable tool to the advancement of the company, as it seeks to overcome what is potentially one of the most significant common and long term problems for fifty-fifty shareholders, their equal voting rights in the absence of an overriding agreement to the contrary.

For knowledgeable and experienced legal representation in advancing your prospective or current shareholdings, while protecting your position as a shareholder, contact us at 403-400-4092 [Alberta], 905-616-8864 [Ontario] or Chris@NeufeldLegal.com.

What is a Unanimous Shareholders Agreement?

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