A shareholders agreement is a binding contract between a company’s shareholders that governs the relationship between the company and its shareholders. Shareholder agreements set out how the company is owned, controlled, and managed, how shareholder’s rights are protected and how shareholders can acquire or dispose of shares.
A shareholder agreement should provide a clear and transparent framework for how the company is manage, owned, and controlled. The benefits of a good shareholder agreement are that it can help attract investors and settle disputes between investors under the agreed framework (if, and when, they arise).
It is always wise to have any shareholder agreement professionally reviewed. If you have been presented with a shareholder agreement to sign, our team at the Small Business Lawyer can review and advice on your shareholders agreement for a fixed fee to ensure your rights are protected and you understand your obligations as a shareholder.