Share Purchase Rights In Austrian Insolvency Proceedings

Shareholders of Austrian limited liability companies ("GmbH") often stipulate the right to purchase the shares of co-shareholders in certain events. These "share purchase rights" (Aufgriffsrechte) entitle the remaining shareholders to acquire the share of a shareholder when a contractually defined event (Aufgriffsfälle), like insolvency or the death of a shareholder, occurs. Often these rights are laid down in articles of association or a separate shareholders' agreement (Syndikatsvertrag). They are generally qualified as option rights.

The reasons for agreeing on such share purchase rights are manifold. The main one, however, is that a shareholder can no longer exercise their shareholder rights (e.g. due to insolvency). The remaining shareholders will thus want to protect themselves against unwanted new shareholders (for example the heirs or a person purchasing the share from the insolvency estate).