Seizure points named
A concrete map of which company decisions your structure cannot currently make under disagreement — most owners are surprised by the list.
Deadlock exposure advisory
Fifty-fifty works beautifully until the first real disagreement.
Deadlock advisories for equal-share and family companies in Israel: Aun & Co. maps paralysis scenarios and builds exit and tie-break mechanics in advance.
Deadlock is the structural disease of equal-share companies: two holders, two directors, and no lawful way to decide anything the moment they disagree. Israeli company law offers court remedies for paralysis — but they are slow, public and value-destroying. A deadlock advisory maps where your structure can seize, then installs the mechanics that prevent it: casting rules, escalation ladders, buy-sell provisions and valuation formulas agreed while everyone is still friends.
The work spans
- Structural review of shareholding, board and signing arrangements
- Paralysis scenario mapping: which decisions can seize, and when
- Buy-sell mechanisms: shotgun clauses, put and call options, auctions
- Escalation ladders: negotiation, mediation, expert, arbitrator
- Valuation formulas agreed in advance of any falling-out
- You and your partner hold fifty-fifty and the founding documents are silent on disagreement.
- A family company is passing to two siblings whose relationship will not survive an open vote.
- Board meetings have started ending without resolutions and the pattern is becoming operational.
- You are entering an equal joint venture and want the exit designed before the entrance.
The firm walks the company's decision map — every resolution the law or the articles require — and marks each point where equal votes can freeze it. For each seizure point, a mechanism is fitted: some decisions get a casting rule, some an escalation ladder, the existential ones a buy-sell with a pre-agreed valuation method. The output is amended articles and a shareholders' agreement in which deadlock has a procedure instead of a courtroom.
04 · What you get
Exits priced in advance
Buy-sell mechanics and valuation formulas agreed in peacetime, when both sides negotiate fairly because neither knows which side of the clause they will be on.
Court kept as last resort
An escalation ladder that resolves most disagreements privately, keeping the statutory paralysis remedies as backdrop rather than destination.
The firm has advised a two-family company approaching generational transfer, where equal branches would inherit equal votes. The engagement mapped the seizure points, installed a mediation-then-arbitration ladder for operational deadlock, and a valuation-backed buy-sell for the existential kind.
Described in abbreviated, anonymised form to preserve client confidentiality.
What happens legally when a fifty-fifty company deadlocks in Israel?
Without agreed mechanics, the routes are court routes: oppression-style proceedings, court-ordered separation or, in extremity, winding-up — slow, public and destructive of value. Contractual deadlock mechanisms exist precisely to keep companies out of that funnel.
What is a shotgun clause and does it work?
A buy-sell mechanism where one holder names a price and the other must buy or sell at it. It is brutally effective at forcing fair pricing between parties of similar means — and dangerous where financial strength is unequal. Fit matters more than fashion.
When should deadlock mechanics be put in place?
Before the first serious disagreement — at incorporation, at investment, or at any calm interval. Once conflict starts, every proposed mechanism is read through the lens of the current fight, and agreement becomes nearly impossible.