Shareholders Agreement: established business single investor

Shareholders Agreement: established business single investor

Shareholders agreement following the investment in an established business by a single investor.

Background

When use a separate Shareholders Agreement?

Having a separate Shareholders Agreement is likely to be more suitable for a company:

• which already has non-management shareholders or investors, perhaps as a result of a previous investment round
• which anticipates having future funding rounds

About this Shareholders Agreement

This document is for a shareholders agreement following an investment by a single investor in an established business. It acts as the shareholders agreement between the investor and the founders of the company going forward.

Document features

• director appointment rights:
  • investor director: the investor’s right to appoint a director
  • other directors: the founder shareholder(s) rights to appoint a director
• board proceedings: how proceedings of the board will be conducted
• future share issues: pre-emption rights on the issue of new shares
• share transfers: process for the transfer of shares, including:
  • pre-emption rights on share transfers
  • compulsory transfer events, including if a founder ceases to be employed by the company whether as a good or a bad leaver
  • tag-along and drag-along rights
• reserved matters: a list of matters requiring the prior approval of the investor and other shareholders
• information rights: rights of the investor and other shareholders to information about the company and its finances

Explanatory guidance

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