Shareholders Agreement

Shareholders Agreement (Startup)

This Shareholders Agreement (the "Agreement") is made and entered into on [Date] by and among [Company Name], a corporation organized under the laws of [State/Country] with its principal place of business at [Company Address] (the "Company"), and the undersigned shareholders (collectively, the "Shareholders").

1. Purpose of the Agreement

• This Agreement outlines the rights, obligations, and relationships among the Shareholders of the Company, as well as the management and operation of the Company.

2. Ownership and Share Issuance

• Each Shareholder’s initial ownership percentage and the number of shares held are detailed in Schedule A: Ownership Interests.
• Additional shares may only be issued with the consent of at least [Percentage, e.g., 75%] of the Shareholders to prevent dilution.

3. Capital Contributions

• Each Shareholder agrees to contribute capital as detailed in Schedule B: Capital Contributions. Any additional contributions will require written consent from all Shareholders.

4. Voting Rights and Decision-Making

• Voting rights are proportional to each Shareholder’s ownership interest, and decisions requiring a vote are made by a majority vote unless specified otherwise in this Agreement.
• Certain major decisions, such as amendments to this Agreement, issuance of new shares, mergers, and sales of the Company, require approval by a [Percentage, e.g., 75%] majority vote.

5. Transfer of Shares

• Right of First Refusal: If a Shareholder wishes to sell shares, the other Shareholders have the right to purchase the shares before they are offered to third parties.
• Drag-Along Rights: If a majority of Shareholders agree to sell their shares to a third party, the minority Shareholders agree to sell their shares on the same terms.
• Tag-Along Rights: If any Shareholder sells shares to a third party, other Shareholders may choose to sell a proportional amount of their shares on the same terms.

6. Dividends and Profit Distribution

• Dividends and profits, if declared, will be distributed to Shareholders based on their ownership percentage, at the discretion of the Company’s board of directors.

7. Confidentiality and Non-Compete

• Shareholders agree to keep confidential all proprietary information related to the Company. Shareholders are also prohibited from engaging in competing businesses without prior written consent from the other Shareholders.

8. Termination and Dissolution

• This Agreement remains in effect until the dissolution of the Company, unless terminated by mutual consent of all Shareholders. In the event of dissolution, assets will be distributed proportionally to ownership interests after liabilities are settled.

9. Dispute Resolution

• Any disputes arising out of this Agreement shall first be attempted to be resolved through mediation. If unresolved, disputes shall be resolved through binding arbitration in [Jurisdiction].

10. Governing Law

• This Agreement shall be governed by and construed in accordance with the laws of [State/Country].

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above written.

Schedule A: Shareholder Ownership and Voting Rights

• Shareholder 1: [Name, Percentage Ownership, Number of Shares]
• Shareholder 2: [Name, Percentage Ownership, Number of Shares]
• ...

Schedule B: Capital Contributions

• Shareholder 1: [Contribution Amount]
• Shareholder 2: [Contribution Amount]
• ...

[Shareholder 1 Name & Title]
Signature: ___________________________
Date: _______________________________

[Shareholder 2 Name & Title]
Signature: ___________________________
Date: _______________________________

Shareholders Agreement (Established Company)

This Shareholders Agreement (the "Agreement") is made and entered into as of [Date] by and among [Company Name], a corporation organized under the laws of [State/Country], and the shareholders listed in Schedule A (collectively referred to as "Shareholders").

1. Purpose and Scope

• This Agreement establishes the terms for governance, management, ownership rights, and obligations of the Shareholders in relation to the Company.

2. Share Capital and Ownership Structure

• The Company’s authorized and issued shares are listed in Schedule A, with each Shareholder’s respective ownership percentage detailed.
• Any issuance of new shares requires the approval of at least [Percentage, e.g., 75%] of the Shareholders.

3. Management and Board of Directors

• The Company’s affairs will be managed by a board of directors. Each Shareholder with at least [Minimum Percentage, e.g., 10%] ownership is entitled to appoint one director to the board.
• All board decisions require a simple majority unless otherwise specified in this Agreement.

4. Voting Rights and Shareholder Meetings

• Voting rights are proportional to the number of shares held. Decisions requiring shareholder approval shall be passed by a majority vote unless otherwise specified.
• Reserved Matters: Certain decisions, such as amending the Articles of Incorporation, approving mergers, and issuing new shares, require at least [Percentage, e.g., 75%] approval.

5. Transfer Restrictions

• Right of First Refusal: If a Shareholder intends to transfer shares, other Shareholders have the right to purchase those shares on the same terms before they are offered to external parties.
• Preemptive Rights: Shareholders have the right to participate in any future share issuances to maintain their proportional ownership.
• Drag-Along and Tag-Along Rights: If the majority Shareholders sell their shares to a third party, minority Shareholders must also sell their shares (drag-along). Minority Shareholders may also join in the sale (tag-along) if a third party acquires a significant percentage of shares.

6. Capital Contributions and Financing

• Shareholders agree to make capital contributions as required and outlined in Schedule B. Additional capital contributions must be approved by [Percentage, e.g., 75%] of the Shareholders.
• If external financing is needed, Shareholders will discuss options and may contribute additional funds proportionally to avoid dilution of ownership.

7. Profit Distribution and Dividends

• Dividends, if declared, will be distributed among Shareholders based on ownership percentages. The board of directors, in consideration of the Company’s financial position, will determine dividend declarations.

8. Non-Compete and Confidentiality

• Non-Compete: Shareholders agree not to engage in or invest in competing businesses during their tenure and for [Duration, e.g., two (2) years] following their exit.
• Confidentiality: Shareholders must maintain confidentiality of all proprietary information related to the Company, both during their tenure and after exit.

9. Exit Strategy

• In the event of a Shareholder’s exit, the remaining Shareholders have the first right to purchase the exiting Shareholder's shares. The purchase price will be determined by [Method, e.g., an independent valuation].
• Buyout Events: If a Shareholder dies or becomes incapacitated, their shares shall be purchased by the remaining Shareholders or the Company at the fair market value.

10. Dispute Resolution

• Any disputes arising out of or related to this Agreement shall first be mediated. If unresolved, they shall be resolved through binding arbitration in [Jurisdiction].

11. Amendment and Waiver

• Any amendments to this Agreement require the consent of at least [Percentage, e.g., 75%] of the Shareholders.

12. Governing Law

• This Agreement shall be governed by the laws of [State/Country] without regard to conflict of law principles.

IN WITNESS WHEREOF, the parties have signed this Agreement as of the date first written above.

Schedule A: Shareholder Ownership and Voting Rights

• Shareholder 1: [Name, Percentage Ownership, Number of Shares]
• Shareholder 2: [Name, Percentage Ownership, Number of Shares]
• ...

Schedule B: Capital Contributions

• Shareholder 1: [Contribution Amount]
• Shareholder 2: [Contribution Amount]
• ...

[Shareholder 1 Name & Title]
Signature: ___________________________
Date: _______________________________

[Shareholder 2 Name & Title]
Signature: ___________________________
Date: _______________________________