Why do I need a Shareholders' Agreement?
If have a business or are thinking of starting one, and there are two or more shareholders involved, it is recommended you get a Shareholders' Agreement prepared as it will be the document that will be used should things go wrong or new investors get involved.
Although not legally mandatory, it is the document that will stipulate what should happen if conflict arises, one party wants to sell or financial difficulties arise. It might seem like a good idea to go into business with your friend, but when hard decisions have to be made, this is the time when the relationships get tested.
Not unlike a marriage or partnership, couples often enter into a 'pre-nup' agreement. If you think about a Shareholders' Agreement like a business pre-nup, it is easy to understand how this document could help you in times of stress, change or separation.
What should be in a Shareholders' Agreement?
Just as no two businesses are the same, nor should any two Shareholders' Agreements. What is in a Shareholders' Agreement depends on not only where you get it from, but what the circumstances are within your business, how many shareholders are involved and other unique factors that should be addressed during the discovery phase of a legal advisor preparing this. To understand the critical need for a business to consider with this agreement, watch this short video where we discuss some fundamental rules to consider when preparing or reviewing your Shareholders' Agreement.
ABLA has prepared this comprehensive Guide to Shareholders' Agreements that walks you through the key elements to consider with this document.
Now you understand the critical nature of having such an agreement, or you've been in business for many years and things may have changed since you started out, what are your options? ABLA's fixed fee packages for businesses offer great value to get you set up for success.