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SHAREHOLDERS’ AGREEMENT



DATED

[Date of Agreement]

 

SHAREHOLDERS’ AGREEMENT

 

Relating to:

[Company Name]

 ([Country] Company number: [Company Number])

 

Made and entered into by and between:

[Names of founding shareholders]

 

 

INDEX

  1. PARTIES.. 3
  2. DEFINITIONS.. 3
  3. INTERPRETATION.. 4
  4. PREAMBLE.. 5
  5. SHAREHOLDING.. 5
  6. MAIN OBJECT OF THE COMPANY.. 6
  7. DIRECTORS AND MANAGEMENT OF THE COMPANY.. 7
  8. RESTRICTIVE COVENANTS AND OBLIGATIONS.. 10
  9. THE SHAREHOLDERS’ VOTING RIGHTS AND MEETINGS.. 13
  10. MATTERS REQUIRING THE CONSENT OF A SPECIAL MAJORITY.. 13
  11. DIVIDEND POLICY AND NET PROFITS.. 17
  12. BORROWING AND GUARANTEES.. 18
  13. FINANCIAL MATTERS.. 19
  14. TRANSFER OF SHARES.. 19
  15. OBLIGATORY TRANSFER EVENTS.. 21
  16. COMPLETION OF SHARE PURCHASE.. 24
  17. FAIR VALUE AND COMPULSORY PURCHASE OF SHARES.. 26
  18. ISSUE OF FURTHER SHARES.. 27
  19. DRAG ALONG.. 28
  20. TAG ALONG.. 30
  21. CONFIDENTIALITY.. 31
  22. NOTICES.. 32
  23. SERIOUS DEADLOCKS: RESOLUTION OF DISPUTES.. 33
  24. TERMINATION.. 34
  25. GOVERNING LAW AND JURISDICTION.. 35
  26. UTMOST GOOD FAITH.. 35
  27. SEVERENCE.. 36
  28. VARIATION AND WAIVER.. 36
  29. ASSIGNMENT. 37
  30. COSTS.. 37
  31. CONFLICT WITH MEMORANDUM AND ARTICLES.. 37
  32. ENTIRE AGREEMENT. 37
  33. THIRD PARTIES.. 38
  34. COUNTERPARTS.. 38
  35. SIGNATORIES.. 38

SCHEDULE 1. 41

SCHEDULE 2. 42

SCHEDULE 3. 44

 

 

  1. PARTIES

 

  1. DEFINITIONS

 

  1. INTERPRETATION

 

  1. PREAMBLE

It is recorded that –

  1. SHAREHOLDING

 

  1. MAIN OBJECT OF THE COMPANY

The main object of the Company shall be to carry on [Enter description of what the Company activity] (the “Business”).

 

 

  1. DIRECTORS AND MANAGEMENT OF THE COMPANY

 

  1. RESTRICTIVE COVENANTS AND OBLIGATIONS

 

  1. THE SHAREHOLDERS’ VOTING RIGHTS AND MEETINGS

 

  1. MATTERS REQUIRING THE CONSENT OF A SPECIAL MAJORITY

 

  1. DIVIDEND POLICY AND NET PROFITS

 

  1. BORROWING AND GUARANTEES

 

  1. FINANCIAL MATTERS




  1. TRANSFER OF SHARES

 

  1. OBLIGATORY TRANSFER EVENTS

 

  1. COMPLETION OF SHARE PURCHASE

 

  1. FAIR VALUE AND COMPULSORY PURCHASE OF SHARES

 

  1. ISSUE OF FURTHER SHARES

 

  1. DRAG ALONG

 

  1. TAG ALONG

 

  1. CONFIDENTIALITY

 

  1. NOTICES

 

  1. SERIOUS DEADLOCKS: RESOLUTION OF DISPUTES

 

  1. TERMINATION




  1. GOVERNING LAW AND JURISDICTION

 

  1. UTMOST GOOD FAITH

 

  1. SEVERENCE

 

  1. VARIATION AND WAIVER

 

  1. ASSIGNMENT

 

  1. COSTS

The costs in respect of and incidental to the preparation of this Agreement shall be for the account of the Company.

 

 

  1. CONFLICT WITH MEMORANDUM AND ARTICLES

In the event of there being any conflict between the terms of this Agreement and any of the terms of the Memorandum or Articles of Association of the Company then, as between the Shareholders, the terms of this Agreement shall prevail.

 

 

  1. ENTIRE AGREEMENT

 

  1. THIRD PARTIES

A person who is not a party to this Agreement shall not have any rights under the Contracts (Rights of Third Parties) Act 1999 to enforce any term of this Agreement but this shall not affect any right or remedy of a third party which exists or is available apart from the Act.

 

 

  1. COUNTERPARTS

This Agreement may be executed in any number of counterparts, each of which when executed and delivered shall constitute an original of that Agreement, but all the counterparts shall together constitute the same Agreement. No counterpart shall be effective until each party has executed at least one counterpart.

 

 

  1. SIGNATORIES

SIGNED at [Insert place] on this [Insert day, month and year] in the presence of the undersigned witnesses.

Witness:

 

Shareholder 1:

1

   
   

(Signatures, Names & Addresses of witness)

 

(Signature of shareholder 1)

SIGNED at [Insert place] on this [Insert day, month and year] in the presence of the undersigned witnesses.

Witness:

 

Shareholder 2:

1

   

2

 

(Signatures, Names & Addresses of witness)

 

(Signature of shareholder 2)

SIGNED at [Insert place] on this [Insert day, month and year] in the presence of the undersigned witnesses.

Witness:

 

Shareholder 3:

1

   

2

 

(Signatures, Names & Addresses of witness)

 

(Signature of shareholder 3)

SIGNED by the Company at [Insert place] on this [Insert day, month and year] in the presence of the undersigned witnesses.

Witness:

 

Company:

1

   

2

 

(Signatures, Names & Addresses of witnesses)

 

(Signature, Name & Title of person duly authorized to sign on behalf of the Company)

 

Name

Address

No. of Shares

Percentage of Issued Share Capital

[name]

[address]

[no]

[%]

[name]

[address]

[no]

[%]

[name]

[address]

[no]

[%]

Name

Address

No. of Shares

Percentage of Issued Share Capital

[name]

[address]

[no]

[%]

[name]

[address]

[no]

[%]

[name]

[address]

[no]

[%]

[name]

[address]

[no]

[%]

 

 

THIS DEED is made on • by • of • (the New Shareholder).

WHEREAS:

THIS DEED WITNESSES as follows:

  1. The New Shareholder confirms that he has been supplied with a copy of the Agreement.
  2. [The New Shareholder hereby subscribes for • • shares of • each in the capital of the Company at a subscription price of • per share and agrees to hold the shares subject to the memorandum and articles of association of the Company.]
  3. The New Shareholder undertakes to be bound by the Agreement in all respects as if the New Shareholder was a party to the Agreement and named in it as an Investor and a Shareholder and to observe and perform all the provisions and obligations of the Agreement applicable to or binding on an Investor and a Shareholder under that agreement insofar as they fall to be observed or performed on or after the date of this deed.
  4. This deed is made for the benefit of (a) the parties to the Agreement and (b) every other person who after the date of the Agreement (and whether before or after the execution of this deed) assumes any rights or obligations under the Agreement or adheres to it.
  5. The address [and facsimile number] of the New Shareholder for the purposes of clause [24] (Notices) of the Agreement is [as above] [as follows:

[Address:

]

[Fax No: •]

(attention of •)

 
 

IN WITNESS of which this deed has been executed and has been delivered on the date which appears first on page 1.

[IF INDIVIDUAL:]

SIGNED as a deed by )

in the presence of: )

Witness's Signature: ...............................................

Name: ......................................................................

Address: ..................................................................

[OR IF COMPANY:]

EXECUTED as a deed by • )

acting by •, a director )

in the presence of: ) Director

Witness's Signature: ...............................................

Name: ......................................................................

Address: ..................................................................

 

 

THIS DEED is made on • by • of • (the Departing Shareholder).

WHEREAS:

THIS DEED WITNESSES as follows:

  1. The Departing Shareholder confirms that he no longer holds any Shares in the Company as [from •].
  2. The Departing Shareholder represents and warrants that he has returned and destroyed all Confidential Information, as defined in clause 20 of the Agreement that he directly or indirectly holds and has access to.
  3. The Departing Shareholder undertakes to continue to be bound by the provisions of clause 20 of the Agreement which will survive any termination of the Agreement, pursuant to clause 24 of the Agreement.
  4. This deed is made for the benefit of (a) the parties to the Agreement and (b) every other person who after the date of the Agreement (and whether before or after the execution of this deed) assumes any rights or obligations under the Agreement or adheres to it.
  5. The address [and facsimile number] of the Departing Shareholder for the purposes of clause [22] (Notices) of the Agreement is [as above] [as follows:

[Address:

]

[Fax No: •]

(attention of •)

 
 

IN WITNESS of which this deed has been executed and has been delivered on the date which appears first on page 1.

[IF INDIVIDUAL:]

SIGNED as a deed by )

in the presence of: )

Witness's Signature: ....................................................

Name: ........................................................................

Address: ....................................................................

[OR IF COMPANY:]

EXECUTED as a deed by • )

acting by •, a director )

in the presence of: ) Director

Witness's Signature: ....................................................

Name: ........................................................................

Address: ....................................................................