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Private Company Shareholder Agreement Template for England and Wales

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Key Requirements PROMPT example:

Private Company Shareholder Agreement

"I need a Private Company Shareholder Agreement for my tech startup with three founding shareholders, including tag-along rights and specific provisions for future investment rounds planned for March 2025."

Document background
A Private Company Shareholder Agreement is essential when two or more parties hold shares in a private company registered in England and Wales. It establishes clear rules for company governance, protecting both majority and minority shareholders' interests. The agreement becomes particularly important during key company events such as share transfers, major business decisions, or when resolving disputes. It supplements the company's constitutional documents and should be implemented early in a company's life or when new shareholders join.
Suggested Sections

1. Parties: Details of all shareholders and the company

2. Background: Context of the agreement and current shareholding structure

3. Definitions: Key terms used throughout the agreement

4. Share Rights and Restrictions: Details of share classes and associated rights

5. Transfer of Shares: Procedures and restrictions for transferring shares

6. Management and Decision Making: Governance structure and decision-making processes

7. Reserved Matters: Decisions requiring special majority or unanimous consent

8. Dividends: Policy and procedure for dividend distributions

Optional Sections

1. Tag-Along Rights: Protection for minority shareholders to join in sale of shares - use when minority shareholder protection is required

2. Drag-Along Rights: Ability to force minorities to join in sale of company - use when majority shareholders want exit flexibility

3. Non-Compete Provisions: Restrictions on shareholders' competing activities - use when shareholders are active in the industry

4. Dead-Lock Resolution: Procedures for resolving management deadlocks - use in 50/50 ownership structures

Suggested Schedules

1. Schedule 1: Details of the Company: Company information including registered office, directors, share capital

2. Schedule 2: Deed of Adherence: Template for new shareholders to sign up to the agreement

3. Schedule 3: Reserved Matters: Detailed list of decisions requiring special approval

4. Schedule 4: Initial Business Plan: Company's initial business strategy and projections

5. Appendix A: Share Transfer Notice: Template for notifying intention to transfer shares

Authors

Alex Denne

Head of Growth (Open Source Law) @ tiktok³ÉÈ˰æ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions




































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Relevant Industries
Relevant Teams
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Industries

Companies Act 2006: Primary legislation governing company law in England and Wales, covering shareholders' rights, directors' duties, company administration, share transfers, meetings, and resolutions

Small Business, Enterprise and Employment Act 2015: Legislation affecting corporate transparency requirements and governance structures for private companies

Companies (Model Articles) Regulations 2008: Secondary legislation providing default articles of association for companies, which must be considered alongside any shareholders' agreement

Financial Services and Markets Act 2000: Regulatory framework for financial services and markets, relevant if the company engages in regulated activities

Insolvency Act 1986: Legislation governing company insolvency procedures and winding up provisions

Corporate Governance Code: While primarily for listed companies, provides useful governance principles that can be adapted for private companies

Contract Law (Common Law): General principles of English contract law, including formation, interpretation, and enforcement of contracts

Unfair Contract Terms Act 1977: Legislation regulating unfair terms in contracts, ensuring reasonable and fair provisions in shareholders' agreements

Data Protection Act 2018: UK's implementation of data protection requirements, relevant for handling personal data of shareholders

UK GDPR: Post-Brexit data protection regulations governing the processing of personal data

Competition Act 1998: Legislation governing competition law, relevant if shareholders' agreement contains provisions affecting market competition

Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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