How to separate amicably

… with the help of a shareholders’ agreement.

A shareholders’ agreement is a bit like a pre-nuptial contract. I always encourage businesses with more than one director/shareholder to get one drawn up and, if they can’t afford the legal fees initially, to at least discuss and document the important parts.

It’s all very well going into business with a friend but I really want them to remain friends when the business has ended.

The agreement includes details of how the company should be run and how each director shareholder will be remunerated.
• What if one wants to work part time while the other is full time?
• What if one is out meeting and greeting and bringing in new clients while the other is in the back office fulfilling all the ‘work’ or operations of the business?
• What if one invests cash instead of labour?
• What if one has a long term illness and has to be carried in the business for a year?

It should also contain details of how the relationship should end.
• Can a minority shareholder be forced to sell out because the majority has found a buyer?
• Can a minority shareholder be tagged onto a sell out by the majority rather than be left with a partner they didn’t choose?
• Can shares be part of a divorce settlement so that a divorced spouse becomes involved in running the business?
• Can shares be inherited if one shareholder dies or will the company buy them back?
• How will the business be valued if one or more directors decide to go their separate ways?
• Can shares be sold to third parties or must they be offered to existing shareholders first?

If you don’t already have a shareholders’ agreement in place consider getting one drawn up now.

What is decision fatigue?

Decision fatigue is the exhaustion that comes with making constant decisions. My tip this week is to remove some of the smaller decisions in your life so here are some ideas for deciding what to wear.

I’d like to think that I simplified my wardrobe long before Steve Jobs or Barack Obama but I don’t know when they started to wear their ‘uniform’ rather than spending time deciding what to wear each day.

  1. The simplest thing is to limit your wardrobe to one main colour so that you need fewer changes to match outfits. You may have noticed that I’m almost always wearing blue with black footwear.
  2. I also wear branded polo shirts and jeans for normal work days. They’re as comfortable as a t-shirt so can be worn when working from home but the collar makes them slightly smarter. Choose something that matches your business image.
  3. These days I follow a 333 clothes system where I choose 33 items of clothing (excluding underwear and sports kit) to last me 3 months. Any seasonal clothes get stored in a box in the loft. I’m pleasantly surprised that I haven’t needed to cheat yet but you set your own rules.

Give it a try and let me know how you get on.