A confidential agreement between some or all shareholders that covers key issues to prevent conflict and protect minority shareholders, and ensure stability and continuity.
What is a shareholders agreement?
A shareholders agreement is a confidential agreement between some or all shareholders that covers key issues to prevent conflict and protect minority shareholders, and ensure stability and continuity.
What does a shareholders agreement cover?
A shareholders agreement covers the issue of new shares to incoming shareholders, company officers, requirements for board and shareholders meetings, unanimous shareholder approval for reserved matters of key importance, shareholders’ duties and entitlements, rights of first refusal for shareholders to buy the shares of shareholders leaving the company, shareholders’ rights to information and dividends, shareholders leaving, including restrictions on competing with the company after leaving, and more.
When should I use a shareholders agreement?
You should use a shareholders agreement when you and other individuals are shareholders in a private limited company, to supplement the company’s articles with provisions relating to shareholders’ powers and entitlements, to ensure the additional provisions are kept confidential in a private contract, or to make it easier to change provisions in the future without having to amend the articles.
Do I need a shareholders agreement?
Shareholders agreements protect an individuals interest in a company and create rules for how a business will deal with any disputes between shareholders.
Use a shareholders agreement contract when you are forming a business with more than one investor and you want to clarify how the business will be run and how decisions are to be made.
Why you'll love us
The Smart Choice
Easy to use, easy to gain. YouLaw is the smart choice for individuals and businesses looking to get great legal work in the most convenient and cost effective way possible.