Compulsory Transfer Of Shares

Our solicitors are vastly experienced in assisting companies of all sizes to facilitate and advise upon the compulsory transfer of shares. At Blackstone Solicitors, we are able to advise many different types of client on the process involved, no matter the complexity of the documentation being considered.

For more information about how our team of corporate solicitors can help in the share transfer process, contact us on 0345 901 0445 or complete our online enquiry form and a member of the team will call you back at a convenient time.

Our Approach

There may be certain circumstances in which a shareholder is forced to sell their shares. This can happen after a specific event has been triggered.

Blackstone Solicitors are known for our efficiency, attention to detail and ability to get things done; qualities much needed when dealing with the compulsory transfer of shares. We will provide professional, pragmatic advice based on our years of experience in this specialist area.

Our team will do all that is necessary to ensure you are properly represented in any documentation and will put your interests first at all times. The compulsory transfer of shares in a business can be highly technical and can sometimes involve different areas of law and regulations; we can advise on all these areas and make sure you are in the best possible position for a successful outcome.

Why Legal Help is Important

It should be remembered that the compulsory transfer of shares can take place in companies of any size and in any industry.

The process can be complex, potentially stressful and can be considered to be an incredibly important process that will have an impact on you and your business, both in the short and long term – it is therefore imperative that you have the best legal experts at your side, not only to ensure everything progresses as it should, but also to make sure both you and your business benefits from the best possible outcome.

Our Services

In the shareholders’ agreement or articles of association, the company may place an obligation on the shareholders to force a sale of their shares if a specific event is triggered. This can include:

  • Death of the shareholder
  • Bankruptcy or insolvency of the shareholder or company
  • Change of control of the company
  • Cessation of employment (especially if the shareholder is a director or employee of the company)
  • Mental or physical incapacity of the shareholder, or
  • Retirement

The rationale for having a compulsory transfer provision is to protect the interests of the company, for example, in the absence of any agreement or provision providing otherwise, any shares held by a deceased shareholder will pass under the terms of their will (if they had one) or under the rules of intestacy. This could mean that a surviving spouse or children of the deceased could hold a significant shareholding in the company.

If an employee or director (who is also a shareholder) is leaving the company, then it makes sense for the company to obligate the shareholder to sell their shares as well.

When a shareholder leaves the company they will be considered either as a ‘good leaver’ or ‘bad leaver’. The circumstances of their departure will determine the value of their shares when they leave. A “Good Leaver” is considered to be someone who has left the company through no fault of their own and on good terms. A “Bad Leaver” on the other hand, is someone who has left the company on bad terms. These can include dismissal for gross misconduct, resignation after a short employment period, dismissal which is not constructive or unfair and breaches of the director’s employment contract or shareholders’ agreement.

It is also important to have clear definitions of both a good and bad leaver.

Whatever the circumstances are of the compulsory transfer of shares, we ensure full compliance with corporate laws and regulations, so that you can be sure that the process is addressed on a firm financial and legal basis.

We will work with you to ensure all financial, tax and legal aspects of the transferring of shares is properly managed. We are able to assist with any aspect of this and will guide you through the technicalities in a clear and concise way. We have a team of experienced solicitors well versed in the process who are ready to assist you.

Get in Touch

Find out more about our services and how our corporate solicitors can assist you and your business by getting in touch. We have offices in Cheshire and London and are able to serve clients across the North West, including Chester and Manchester, as well as throughout the UK and also overseas.

Call us on 0345 901 0445 or complete our online enquiry form and we will be in contact as soon as we can.

Get in Touch Today

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Our Team

The award winning team is well known for their tenacious approach to their client's cases. Our highly regarded team is passionate about your success. All team members are incredibly academic and continuously strive for more.