Shareholders’ Agreement Lawyers in Midrand

A shareholders’ agreement (SHA) is a private contract that governs the relationship between a company’s shareholders and usually the company itself. Under section 15(7) of the Companies Act 71 of 2008, any provision that conflicts with the Act or the company’s Memorandum of Incorporation (MOI) is void to the extent of the inconsistency, so an SHA should always be drafted or reviewed alongside the current MOI.

Burger Huyser Attorneys assists Midrand companies with drafting, reviewing and negotiating shareholders’ agreements through its Commercial Law and Contracts practice. Instructions can be opened at the Midrand branch in Waterfall Office Park, with specialist commercial-law input from J’Retha van Rensburg.

Why Engage a Midrand-Based Shareholders’ Agreement Lawyer

A shareholders’ agreement allocates commercial risk before disagreement arises. It can regulate initial contributions, voting, reserved matters, dividends, share transfers, deadlock, exits, restraints of trade and dispute resolution. For a company with two or more shareholders, careful drafting is usually far less disruptive than trying to negotiate these issues after relationships have deteriorated.

The Companies Act and MOI remain the controlling framework. A clause cannot be rescued merely because every shareholder signed it if the clause is inconsistent with either. A commercial attorney should therefore obtain the MOI currently filed with the Companies and Intellectual Property Commission (CIPC), compare the proposed SHA against it and identify whether an MOI amendment is also required.

Using a Midrand attorney also simplifies in-person meetings between founders, investors and BEE partners, document collection and negotiation. Burger Huyser’s Midrand office provides a local intake point for this work while the agreement itself remains governed by national company law.

What the Service Covers

The scope should be agreed after the attorney understands the company, its capital structure and the parties’ commercial objectives. A typical mandate may include:

• SHA and MOI review: comparing the current constitutional document with the proposed private agreement and flagging section 15(7) inconsistencies.
• Drafting from scratch: preparing terms suited to the company’s ownership, management and funding arrangements rather than relying on a generic template.
• Governance terms: defining voting thresholds, reserved matters, board appointment rights and information rights.
• Share-transfer controls: drafting pre-emptive rights, permitted transfers, deeds of adherence, tag-along rights and drag-along rights.
• Deadlock and exit mechanisms: setting escalation steps, valuation methods, payment terms and buy-sell procedures.
• Financial arrangements: distinguishing equity from shareholder loans and considering the statutory rules governing financial assistance.
• BEE and vesting provisions: aligning commercial terms, vesting, lock-in and funded-equity arrangements with the applicable transaction and current B-BBEE requirements.
• Counterparty review: marking up and explaining an agreement proposed by an investor, co-shareholder or transaction partner.

Where a new shareholder acquires shares, the mandate may also include a deed of adherence so that the incoming party becomes bound by the existing SHA. Intellectual-property ownership, confidentiality, restraint-of-trade and dispute-resolution clauses can be tailored to the company’s actual operations.

The Statutory Framework the SHA Must Fit

The Companies Act 71 of 2008 sets mandatory rules that private drafting cannot override. Important provisions include:

Provision	Practical relevance
Section 15(7)	Permits agreements concerning company matters but renders a term void to the extent that it conflicts with the Act or MOI.
Section 37	Regulates the preferences, rights, limitations and other terms attached to shares. Class rights requiring constitutional force must be properly reflected in the MOI.
Sections 44 and 45	Regulate financial assistance for the subscription or purchase of securities and financial assistance to directors and prescribed officers, subject to the applicable authority, solvency and liquidity, fairness and other statutory requirements.
Section 65	Governs ordinary and special resolutions. The default thresholds are more than 50% and at least 75% of voting rights exercised, and an MOI variation must preserve the statutory margin between them.
Section 163	Allows a shareholder or director to seek court relief from oppressive or unfairly prejudicial conduct, or conduct that unfairly disregards their interests.
Section 164	Provides qualifying dissenting shareholders with appraisal rights in specified fundamental transactions, subject to strict procedural steps.
Section 218(2)	Provides that a person who contravenes the Act is liable to another person for loss or damage suffered as a result, subject to how courts interpret and apply the provision in context.

An SHA can strengthen practical protections, but it cannot contract out of statutory remedies. It should work with the MOI and the Act as one coherent governance framework.

When a Shareholders’ Agreement Is Most Needed

• At incorporation: before trading begins and before any shareholder gains negotiating leverage through a later dispute.
• When introducing a shareholder: whether through a new issue or transfer of existing shares.
• Before external investment: when investors require governance, information, dilution and exit protections.
• During a BEE transaction: where commercial rights must be reconciled with current ownership and verification requirements.
• For a joint venture: to define contributions, management, duration, risk allocation and dissolution.
• When tensions are developing: because a negotiated framework may still resolve immediate concerns and regulate future conduct.

What to Look for When Choosing a Midrand SHA Lawyer

The attorney should be fluent in the Companies Act and able to explain exactly how the MOI affects the proposed agreement. They should also understand share classes, governance thresholds, transfer controls and the practical consequences of each exit mechanism.

• Ask how the existing MOI will be reviewed and whether amendments may be necessary.
• For a BEE transaction, confirm that the drafting will be informed by the applicable ownership structure and current Codes of Good Practice.
• Require a workable deadlock clause, particularly where ownership or voting power is evenly divided.
• Check that dispute resolution identifies the steps, forum, seat, governing law and appointment process.
• Ensure any restraint protects a legitimate business interest and is appropriately limited by activity, area and duration.
• Request a written scope and transparent fee quotation after the attorney has reviewed the transaction.

Burger Huyser’s Commercial Law and Contracts practice covers shareholders’ agreements and is supported by specialist consultant J’Retha van Rensburg.

Practical Considerations: Cost, Timeline and What to Bring

Fees depend on the number of shareholders, quality of the existing documents, complexity of negotiations and whether the structure includes multiple share classes, vesting, BEE funding or international parties. Burger Huyser Attorneys quotes per file after the initial MOI and scope review rather than applying an unverified standard price.

A straightforward agreement commonly moves from instruction to signature in approximately two to four weeks. Contested negotiations and complex investment structures can take longer because each party may require separate advice and several drafting rounds.

Documents for the First Consultation

• The current MOI filed with CIPC and the company’s founding documents;
• the securities or share register;
• an organogram identifying shareholders, directors and beneficial ownership;
• any existing SHA, deed of adherence or draft agreement;
• investor, BEE-partner or joint-venture term sheets and letters of intent;
• relevant board and shareholder resolutions; and
• a written summary of contributions, management roles, reserved matters, funding and intended exits.

If your company needs a shareholders’ agreement drafted, reviewed or aligned with its MOI, contact Burger Huyser Attorneys’ Midrand branch on 010 022 4082. Bring the current MOI, share register and any existing agreement or term sheet so the Commercial Law and Contracts team can assess the scope accurately. Burger Huyser was named Commercial Law Firm of the Year 2025 – South Africa at the 5 Star Lawyers Awards and holds a 4.8/5 average from 250+ Google reviews, verified by Trustindex.

Frequently Asked Questions

How much does a shareholders’ agreement cost in Midrand?

Fees depend on the number of shareholders, the existing MOI, negotiation requirements and whether the structure includes BEE terms, vesting, multiple share classes or international parties. Burger Huyser Attorneys provides a per-file quotation after the initial document and scope review.

Is a shareholders’ agreement legally required in South Africa?

No. South African law does not require every company to have a shareholders’ agreement, but it is an important risk-management document for a company with more than one shareholder. Without one, the Act and MOI may not address the parties’ detailed funding, transfer, deadlock and exit arrangements.

What is the difference between a shareholders’ agreement and an MOI?

The MOI is the company’s constitutional document filed with CIPC, while a shareholders’ agreement is a private contract regulating additional commercial matters between its signatories. A shareholders’ agreement provision that conflicts with the Companies Act or MOI is void to the extent of the inconsistency.

How long does it take to draft a shareholders’ agreement in Midrand?

A straightforward matter commonly takes approximately two to four weeks from instruction to signature. Complex structures or contested negotiations take longer, depending on the parties and number of drafting rounds.

Can Burger Huyser review an SHA that another firm has drafted?

Yes. The Midrand branch can review and mark up an agreement proposed by an investor, BEE partner, co-shareholder or another attorney. The review may address its consistency with the MOI and Companies Act, as well as transfer, restraint, deadlock, exit and dispute-resolution terms.

Where is the Burger Huyser Midrand branch, and what are the hours?

The branch is at Waterfall Crescent South, Waterfall Office Park, Bekker Road, Vorna Valley, Midrand, 1686. Telephone 010 022 4082; mobile 064 555 3358; after-hours 077 274 1932. The firm reference confirms head-office hours but does not separately verify Midrand’s hours, so consultations should be booked directly with the branch.