We are able to advise and prepare tailor-made cross-option agreements and shareholder agreements for all owner-managed businesses. For more information, please contact James Hodgson in our Bury office on 0161 764 4062 or by email jhodgson@butcher-barlow.co.uk. In addition, in the event of a takeover by the company itself at the time of the takeover (i.e. at the time of exercise of the option and not only on the date of the conclusion of the agreement), there must be sufficient distributable reserves in the company. A duly developed cross-option agreement, with associated maturity guidelines, not only ensures that the beneficiaries of a deceased shareholder can derive value from the business, but also does so in a way that is both fiscally efficient and results in minimal disruption to the remaining shareholders. Elements of a cross-option agreement include the corresponding life insurance policy, where by which the deceased`s shares are paid, and the trust, which stipulates that the proceeds of the policy will be used to finance the purchase of the deceased`s shares in order to protect the insurance proceeds of the deceased`s estate. BakerLaw has experience in developing tailored shareholder agreements and cross-option agreements, and we work with your other professional advisors to ensure the best level of protection for you and your families. We are also able to inform shareholders of their existing rights under a shareholders` agreement. At the same time, each shareholder adopts an insurance policy of the terms, according to which any amount payable under the policy is held in trust by the current shareholders to pay the shares of the deceased under the put and call options.

A cross-option agreement gives each owner-manager an „option“ for their shares in the event of death. This concerns two things: 1. grants the surviving owners the right to buy the deceased`s shares; and 2. Allows the family of the deceased to force the remaining owner-managers to buy the shares of the deceased. Cross-option agreements and incurable critical illness/illness After the death of a business owner, surviving owners have the option to require the deceased owner`s personal representatives to sell their shares in the business to the surviving owners. Shareholder protection insurance is a type of commercial insurance that can be purchased by shareholders or a company to protect their shareholders. It can be levied to pay in case of death or critical illness included. If a shareholder becomes ill or dies, the police ensure that the remaining shareholders receive a sum of money and then buy the shares of the deceased estate. It is indispensable for a company, as it means that the remaining shareholders can still hold a percentage of the company, while the agreement reached (the cross-option agreement) ensures that the family of the deceased shareholder receives a sum of money in the value of the shares.

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