Important Decisions – Which corporate decisions or actions require unanimous agreement from shareholders or directors or require broader agreement from shareholders and directors (. B for example, bonds in excess of certain amounts, expenses on a certain amount in dollars, the issuance of other shares)? Compulsory buy-out (shot-gun clause) – Is there going to be a “shot-gun” clause in which a shareholder, alone or in agreement with other shareholders, makes a binding offer to one or more other shareholders to either sell all their shares or buy the shares of the bidding shareholders? Please note that this article is intended only as a general discussion on issues that may be asked by new York business owners who are closely managed in New York and should not be considered as the creation of a solicitor-client relationship or as legal advice with respect to a particular individual, business or situation. The circumstances and legal principles are varied and you should consult a lawyer before entering into a contract or agreement. How are profits distributed among shareholders? Will the company pay salaries? Are dividends paid or set on a pre-determined formula? Will shareholder loans take precedence over other distributions? Default – Consider what is considered a late payment under the shareholders` pact (e.g. B bankruptcy, insolvency, incapacity to work, adultery, breach of contract, retirement, change of control of the partner) and what happens when a shareholder is late (e.g. B forced purchase)? How are the shareholders due to be assessed in the event of a late payment – are they subject to a discount? Majority Drag Along Rights – Do majority shareholders have the option of forcing other shareholders to sell their shares if the majority shareholders buy a buyer willing to buy all the shares of the company? This provision prevents minority shareholders from blocking the sale of the entire company as opposed to a majority stake. In this article, I summarized many of the most common issues that shareholders should consider before negotiating a shareholders` pact. The main objective of a shareholders` pact is to regulate relations between partners or partners. This document helps define the most important ground rules for business management and identifies important future decisions such as liquidity events. A strong shareholder contract significantly reduces potential potential future conflicts. Limited shares – Are shareholders prevented from operating a business in competition with the company? Will there be protection of confidential information, trade secrets and intellectual property? Will there be restrictions on the recruitment of former customers or employees if a shareholder is no longer a shareholder? How are the shares assessed in the above circumstances (z.B.
regularly defined by shareholders, by agreement at the time of the assignment, infested by the services of a corporate broker, a certified accountant or an accountant)? Right to first refusal – Should a selling shareholder first offer his shares to the company`s other shareholders? Are there exceptions (z.B. Transfer of shares to an affiliate)? Will this shareholder be obliged to offer all his shares or can he be a partial offer? Identical or unequal contributions – should each shareholder (or partner`s sponsor) devote all his time and energy to the company`s activities? If not, will additional compensation be awarded for disproportionate shareholder contributions? Minority Tag Along Rights – Will minority shareholders be able to force a buyer of the shares of the majority shareholders to buy their shares as well? This provision gives the minority shareholder (s) the opportunity to decide whether to engage with the new majority shareholder.