NEGOTIATION OF SHAREHOLDER AGREEMENTS ON LIQUIDATION PREFERENCE THROUGH THE OPTICS OF CZECH CORPORATE LAW
2022
Abstract
Shareholders' agreements very often include provisions on liquidation preference, the purpose of which is to provide investor shareholders with protection of their investment through a preferential right to performance provided to shareholders by the company. It is undoubtedly entirely up to the will of the shareholders whether they will leave such provisions only in the shareholders' agreement and attribute only binding effects to them, or whether they will transfer or reflect, at least in part, such arrangements in the articles of association.
However, if they decide to modify the given provisions only in the shareholders' agreement, the question arises as to what extent they are effectively enforceable at the level of corporate law.