Partnership agreements or parasocial agreements
A Corporate Pact is a contract signed by the partners and that regulates the relationships of the partners with each other and the relationships of the partners with the company. What is intended is to unite wills to develop a common business project with its rights and obligations. It is a perfect complement to regulate the relations between partners in those aspects where the statutes cannot regulate said agreements.
When a Partners Agreement is signed, this agreement always prevails over the Company Bylaws in the event of a discrepancy and it may contain matters that are not inscribable in the Mercantile Registry.
Normally, a Partners Agreement regulates the following matters:
- Relationship Agreements: Agreements that regulate the relationships between partners: This section usually regulates everything related to remuneration, maximum ages of the working partner to be in the company, issue of incorporation of new partners and even relatives of those who are already there and the issue of non-competition within the same activity to avoid that at any time one of the partners founds a company that is direct competition of the one they already have.
- Matters that are exclusively the competence of the General Shareholders’ Meeting, in the event that this management body is agreed: In this section, what is usually regulated is the issue of reinforced majorities to avoid that in decisions of important importance for the company they can get ahead simply with 51% of the capital stock that can be in the hands of two people. It also regulates the entire issue of approvals for new lines of business, important decisions for society, etc.
- Organization Pacts: In this section it is decided, among others, which management bodies the company will have, the duration of the positions, the advisability or not of paying the position, whether or not to appoint a CEO and ultimately everything that may affect in one way or another the good development and governance of the company.
- Dividend distribution policy: In this case, it is intended to establish a mandatory minimum dividend once the mandatory legal reserves have been covered and to repay loans, if any. You can establish a scaling with different percentages to distribute depending on the benefits obtained.
- Regime for the transfer of social shares (inter vivos and mortis causa): This is intended to establish guidelines for action in the case of inter vivos transfers so that when this situation occurs, it is well regulated whether these shares can be freely transferred or establish a preferential acquisition right or restrictive clauses depending on the Purchaser or restrictions subordinate to what is decided by the General Shareholders’ Meeting.
- The most common agreements are: Family protocols, Joint Ventures, Co-investment and financing agreements, Exit or divestment agreements, Management agreements, Tag-along, Drag-Along, Purchase and sale options, Blockade Syndicate, Syndicate of Vote, etc.