What if there are a number of buyers acting together by way of a joint venture?
It is usual for there to be a shareholders/joint venture agreement to regulate relevant matters between the buyers/investors. As to what is covered will depend upon the particular circumstances but typically would include matters relating to the provision of funding (by way of capital or loan or both) share allocations and whether there are different types of share carrying different rights. If there are minority shareholders, provisions which prevent the majority shareholders from abusing their dominant position and if there is a sleeping or venture capitalist type partner, requirements for the provision of information and for board representation. It is also common for there to be pre-emption rights giving other shareholders the right of first refusal should one of them wish to sell their shares, and to restrict circumstances under which the shares can be sold to third parties.
