![]() The clause is commonly used in investment agreements, by-laws, and shareholders’ agreements of equally owned companies. ![]() "turn over" the initiative completely, proposing to become the buyer of the bidding partner's shares, for the price the latter had indicated in its offer. The shareholder receiving the offer may alternatively:Īccept the offer, and thus sell its own shares at the price indicated by the other party In its simplest scheme, the Russian roulette clause provides that, upon the occurrence of a deadlock situation that cannot otherwise be resolved, one or both of the shareholders is given the power to make an offer to the other shareholder to purchase its shares. On these assumptions, parties often agree on including in the company's by-laws and shareholders' agreements specific mechanisms, such as that provided for in the Russian Roulette clause. The clause aims at resolving deadlock and stalemate situations, especially when a major disagreement between shareholders occurs, but no side holds the majority.Ī deadlock situation is risky: it can impede the company’s ordinary business operations if key decisions cannot be taken, and lead to its dissolution and distribution of assets. The “Russian Roulette" clause (and similar, such as the “Texas shoot-out" clause) has been imported into Italy from the Anglo-American legal system. ![]() Did you know that the Italian legal system has been debating on whether the so-called “Russian Roulette” clause is lawful? ![]()
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |