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What are some of the issues to consider in relation to investor consent?

27 March 2018

In this video you will hear what needs to be considered when agreeing to have investor consents in a shareholders agreement.


transcription

Speaker key
Rachael Russell


If you are going to agree to having investor consents in your shareholders agreement then there are a couple of things that you need to think about.

One of them is: is your investor actually going to be responsive when you are asking them for consent on a particular matter?

The second one is: are operational matters, such as contract value, set at an appropriate level? Because you don’t want the consent process to hinder the day-to-day goings on in the business.

And the third one is: who is actually going to be giving that consent? Are you going to have an investor director sat on your board or are you going to have to approach the investor each time you want consent directly?

Once you’ve got all of those matters agreed it is really important that these consent matters become part of how the business operates on a day-to-day basis and that the board know exactly what these matters are.

This will help create a management team that is really joined up with its investor, it will help maintain a really great working relationship and could potentially help you secure some further investment in the future.

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The opinions expressed on this video are provided for the purposes of general interest and information and should not be relied upon. They contain only summaries of aspects of the subject matter at the time of publishing and do not provide comprehensive statements of the law. They do not constitute legal advice and do not provide a substitute for it. So why not talk to us and seek advice that's tailored to you? You can look up one of our experts on this website or call on 0370 270 6000.

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