Shareholders' Agreement

Each new shareholder is required to sign our Shareholders Agreement. Under this, only a decision by those holding 95% of the shares can potentially change the use of the land. In addition the original owner of Spring Field made a stipulation that the use should remain agricultural, and the 5-year agricultural tenancy, which our farmer tenant has, provides for this on a rolling basis. (To see this stipulation in the 1993 Conveyance for the purchase of the land, click on the 'Documents' link below). It was also agreed, by means of an 'uplift' clause in the conveyance for Spring Field, that should the land be sold then the original owner would receive 50% of the difference in value between the original price paid by the company for the land and its value at the time of the sale. This provides a disincentive to the shareholders ever to sell or develop it. In practice moreover, it is possible for a shareholder to own more than 5% of the shares and thereby to exercise a veto over any change of use of either piece of land, and three shareholders are in this position at present.

Furthemore, the company's shareholders are also bound by an agreement which essentially stipulates that shares are transferred to a new owner only when the owner sells their house and moves away, and generally only to the new owner of the house. This means that in general shareholdings are effectively "attached" to a particular property, and have no open market value. In practice, when shareholders have moved away from the village, their shares have been passed on to the new house owners, along with the house, often without charge to the new house owners, although their nominal value remains at £250 per share.

Click on the 'Documents' link to see the Shareholders' Agreement and other company documents in full.