Document background
The Shareholder Exit Agreement is a critical document used when a shareholder wishes to terminate their ownership interest in a Canadian company, whether due to retirement, strategic sale, or other circumstances. This agreement is essential for private companies operating under Canadian federal or provincial jurisdiction, as it provides a clear framework for managing ownership transitions while protecting all parties' interests. The document typically includes detailed provisions for share valuation, payment structures, confidentiality requirements, and non-compete clauses, all tailored to comply with Canadian corporate and securities laws. It's particularly important for companies without publicly traded shares, as it provides a pre-agreed mechanism for share transfers and helps prevent potential disputes. The agreement must account for specific Canadian tax implications, securities regulations, and corporate law requirements, whether under the federal Canada Business Corporations Act or provincial legislation.
