Basic Shareholders Agreement

Shotgun Commission: A shotgun exit provision, also known as a buy-sell agreement, can be used as a result of a shareholder dispute and states that Shareholder 1 may offer to purchase shareholder 2`s shares, with shareholder 2 being able to either sell at the offered price or return and buy shareholder 1`s shares at the same price. A shareholders` agreement is an agreement between the shareholders of a given company. Anyone can be part of the agreement. However, in some cases, only a part of the shareholders participates in the contract. For example, only shareholders of a certain class of shares can be part of the agreement. 17.2 The content of this shareholders` agreement may not be modified without mutual agreement between the parties. The parties will discuss annually, within the framework of the general meeting of the company, the question of whether to revise the shareholders` agreement. The agreement contains sections that set out the fair and legitimate pricing of shares (especially when selling). It also allows shareholders to make decisions on external parties likely to become future shareholders and offers protection for minority positions. When capital is raised that brings in new shareholders or when an existing shareholder transfers shares to third parties in different ways (including family members), those shareholders must be related to SHA. To do this, a SHA should clearly stipulate that any new shareholder or buyer must be part of the SHA before receiving the shares.

This can be done by requiring such a purchaser or a subsequent share buyer/investor to sign a document in the form of an deed in which he agrees to be bound by all the terms of the SHA. Such a document is an “instrument of accession” or an “instrument of accession”. PandaTip: Change according to the number of shareholders; Sometimes there are only two. In the event of a voluntary transfer, the selling shareholder must ensure that the conditions for the purchase of his shares are extended to the other shareholders in relation to their respective shareholdings. Tag Along-Rights exist to protect minority shareholders, so that when a majority shareholder sells their shares, they give other shareholders the right to join the transaction.