Shareholder disputes on the qualification as Good- or Bad Leaver: reflect before you act

Disputes over leaver provisions in shareholders' agreements occur regularly. A departing shareholder may be convinced that he qualifies as a good leaver under the applicable shareholders' agreement, while the remaining shareholders believe he is a bad leaver. The qualification as good leaver or bad leaver is relevant for the share price the departing shareholder receives for his shares upon (mandatory) offer of his shares to the remaining shareholders.

Published case law on this type of disputes is scarce, but does confirm that an unambiguously worded leaver provision in a shareholder's agreement can facilitate an effective exit of a shareholder given the liguistical interpretations by the courts.

A recent judgment of the Amsterdam District Court dated 18 January 2023 is exemplary of the strict effect of a leaver provision, which in this case resulted a share price of EUR 1 in a good-leaver situation.  So the motto should be: reflect before you act. Parties directly or indirectly investing in companies, especially start-ups or scale-ups, should carefully consider the wording of the arrangements with their co-shareholders contained in the shareholders' agreement especially in respect of leaver provisions and the share price they will receive for their shares in the event of an exit.

Following this recent judgment, Maarten Feenstra and Bart-Adriaan de Ruijter wrote an article that provides a practical overview on the relevant case law and literature in this area, which was published in Bedrijfsjuridische Berichten last August 2023.

An important recent Supreme Court judgment of 30 August last (ECLI:NL:HR:2023:1131) reaffirms that between professional parties the applicability of the Haviltex standard can be excluded. This judgment will make the contractual exit of shareholders even more effective if provisions are clear.

Should there be any further questions and/or comments, please do not hesitate to contact our experts Maarten Feenstra and Bart-Adriaan de Ruijter.