SHAREHOLDER DEADLOCK RESOLVED without COURT

Two founders built a company together for eleven years. Then they stopped speaking — and the business stopped with them.

Our client owned exactly half of a profitable manufacturing business. The other half belonged to his co-founder. After a disagreement over expansion, the two had not spoken directly for four months. Every board decision required both votes, so nothing was being decided.

A key supply contract was due for renewal in six weeks. Without a signed board resolution, it would lapse — and with it, around a third of the company’s revenue.

• 01HIGH riskREVENUE AT RISKA contract worth a third of turnover would lapse without a board vote.
• 02HIGH riskA PUBLIC FIGHTCourt proceedings would be public and could take 12–18 months.
• 03MEDIUM riskTEAM & CLIENTSStaff and customers were starting to notice the silence at the top.

Court was available, but it would have taken a year and split the company in public. We chose a faster route built on the agreement the founders had already signed.

1. WEEK 1READ THE AGREEMENT THEY ALREADY HADThe 2015 shareholder agreement contained a deadlock clause nobody remembered. It allowed either party to trigger a structured buy-out.
2. WEEK 2SECURE THE CONTRACT FIRST
3. WEEKS 3–5AGREE ON A NUMBER, INDEPENDENTLY
4. WEEKS 6–9TWO DAYS OF MEDIATION

• TIME TO RESOLUTION9 wksvs. 12–18 months in court
• PROCEEDINGS ISSUED0Resolved entirely by agreement
• REVENUE PROTECTED34%Key contract renewed on time

Our client bought out his co-founder at an independently agreed price, paid in two instalments. The supply contract was renewed four days before it would have lapsed. Both founders signed a mutual release — and still meet for lunch.

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We kept the company and, somehow, the friendship. I did not think both were possible.

Published with the client’s written consent. Names and identifying details have been changed. Past results do not guarantee a similar outcome.