"I Go or They Go" Clauses as an Unblocking Mechanism in Corporations

Corporate attorney Julia Velásquez published an article in Asuntos Legales examining "I go or they go" clauses and their potential as a tool to resolve standstills or conflicts among shareholders in a company. These clauses allow one shareholder to purchase the shares of another at a determined price. The chief advantage of this clause, explains the author, is that it can avoid liquidation or litigation, as the lack of agreement among shareholders can paralyze the management of a company. However, there are risks involved, in particular the question of what constitutes a "fair price" for shares, and Ms. Velásquez cautions shareholders to establish clear criteria and objectives for their valuation.

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