Shareholders’ Agreement

A private contract between a company and its shareholders that sits alongside the articles of association. It protects each shareholder’s investment by setting out who sits on the board, which decisions need shareholder consent, how shares can be sold, what happens when a shareholder who works in the business leaves, and how the company can be sold or a deadlock broken.

• When two or more people own a company together, especially if they also work in it
• When bringing in a new investor, or giving shares to a key employee
• When an existing informal arrangement needs putting on a proper footing

• Fill in the parties, shareholdings (Schedule 4) and the thresholds in clause 1
• Choose which reserved matters need unanimous and which need majority consent (Schedule 1)
• Decide the leaver prices, the drag and tag thresholds and the deadlock route
• Check the articles match this agreement – amend them by special resolution if needed