Shareholders' agreement: new company

This agreement provides a very thorough framework for the shareholders of any new private company to set up the precise structural management of their business. It covers every provision you are likely to want, including options that empower a minority who requires special rights, and those commonly required by institutional investors providing start-up capital.

Suitable for use in: England & Wales and Scotland
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About this document

A shareholders’ agreement is an essential document for any new company. Not only should this template help you establish the strategic management structure you need to grow your business, but also ensure that your investment is protected when you or other owners decide to sell.

This template is suitable for companies in any industry and with any number of shareholders. It could be put in place by a majority or a minority owner.


No other shareholders’ agreements for sale on the Internet are so comprehensive in their cover of legal issues, and the drafting explanations and tips supplied. In many areas, we give you complete alternative paragraphs and explain in the notes when each will be the most suitable for you.

We have added extra provisions for cases where they may be required, for example, for a situation where one or more minority shareholders wishes to exert a level of influence that is more than could be expected from the weight of its shareholding. These are clear and can easily be edited or removed without affecting the remainder of the document.

Examples of provisions included are:

  • obligations of the company to the shareholders (the company is also a party to the agreement)

  • how shareholders will maintain their rights if they are not present at meetings

  • roles of directors and actions by the company or a director which require shareholders’ consent: controls and redistributes power between shareholders so that majority shareholders cannot force decisions

  • new shareholder rights and restrictions: even if he is a trustee in bankruptcy

  • special protection of a minority by specification of critical decisions that must be agreed by that shareholder

  • facility for a minority shareholder to appoint his or her own nominated director who cannot be removed by the others.

  • how to deal with new intellectual property

  • transfers of shares and rights of pre-emption or first refusal: when allowed, under what conditions and to whom

  • exit strategy: including drag-along and tag-along rights

  • key man insurance

  • publicity about the deal

  • confidentiality

  • use of a shareholder’s own assets in the business

  • vesting provisions

  • different valuation methodologies for the shares on the departure of a shareholder

Other versions of this agreement

We also offer a version of this agreement for an established company.

If the company does not have an outside investor, you may prefer to use this simpler alternative version that does not contain provisions specified above for such shareholders.


This document was written by a solicitor for Net Lawman. It complies with current English law.

UK-CPsha01 - Shareholders' agreement: new company (Suitable for use in: England & Wales and Scotland)

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