Two groups of companies set up a company based in France (Socit rsponsabilit limite - a Limited Liability Company) with an initial capital of 10.000 Euros under a 50%-50% basis. They plan to jointly run an innovative automotive business and they estimate financial needs up to 1.000.000 Euros. The two entrepreneurs are concerned about legal consequences deriving from this desired investment as well as their ability to avoid future disagreements between them. Are they risking management deadlocks of their company ? How could they avoid them?

Advise them how to proceed in order to anticipate such risks and prevent them by preparing a brief informative note with your proposals. Draft two of the conditions that should be included in their agreement.