Shareholders Agreement: established business multiple investors
Shareholders agreement following the investment in an established business by multiple investors under a separate subscription agreement. The agreement acts as the shareholders agreement between the investors and the founders of the company post-investment.
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When do I use this document?
- for the shareholders agreement between multiple investors and the founders
- where the investment is being documented in a separate subscription agreement
- in conjunction with a Subscription Agreement and new Articles of Association
- for Paper Rock’s associated Subscription Agreement and Articles of Association, see
- for a private limited company incorporated in England and Wales
What are the key features?
- full form shareholders agreement
- 27 clauses and 4 schedules over 30 pages
- investor rights: exercisable by a majority of the investors
- directors:
- investor director: investors’ entitlement 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
- information rights: rights to information for the investors and other shareholders about the company and its finances
- future share issues: pre-emption rights on the issue of new shares
- share transfers: rules governing the transfer of shares, including:
- pre-emption rights on share transfers
- compulsory transfer events, including founder good and bad leaver clauses
- tag-along and drag-along rights
- reserved matters: matters requiring prior approval from the investors (acting by investor majority) and other shareholders
- restrictive covenants: restrictions on the founders from competing with the company and soliciting the company’s customers, suppliers and employees
What other documents are available?
For a combined Investment & Shareholders Agreement for an established business with multiple investors, see
For a standalone Shareholders Agreement for an established business with a single investor, see
For standalone Shareholders Agreements for start-up business, see
When do I use this document?
- if a shareholder has lost its original share certificate or it has been destroyed
- if applicable, alongside a transfer of the shares covered by the lost or destroyed original certificate
What are the key features?
- different forms of indemnity, depending on whether the shareholder is also transferring shares
- alternative forms of indemnity, depending on whether the shareholder is an individual or a company
What else do I need to know?
What is a share certificate?
A share certificate is a document evidencing ownership of shares in a company. By law, shareholders are entitled to receive this certificate when they acquire shares, either through allotment or transfer.
What happens if a share certificate is lost or destroyed?
If a shareholder loses or destroys their certificate, they can ask the company for a replacement. To safeguard itself, the company will usually require a lost share certificate indemnity. This is a legal undertaking under which the shareholder agrees to cover any losses the company might face by issuing the replacement.
What risks does the indemnity protect against?
The indemnity protects the company from risks such as:
- Duplicate Claims: If the original certificate reappears, someone else might claim ownership, causing disputes or financial loss.
- Fraudulent Claims: A person could falsely claim to have lost the certificate and misuse the replacement, for example, by attempting to sell the shares unlawfully.
- Administrative Errors: Mistakes in issuing a replacement or registering a transfer without the original certificate could lead to legal administrative errors.
- Legal Liability: If a replacement certificate or transfer is improperly handled, the company might be held responsible for resulting losses.
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Updated by a lawyer on 02/07/2025
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