What needs to be included in a Shareholders Agreement

This Shareholder Agreement is a short-form document which creates a contractual relationship between the shareholders of a private limited company.

This short Shareholder Agreement is designed for private companies in which each shareholder will own an equal share, so that there are no minority shareholders and no majority shareholders. Therefore there is no bias in the Agreement toward one particular kind of shareholder.

The main advantage of a Shareholder Agreement is that in addition to enforcing their shareholder rights against the company under its constitution it allows individual shareholders to enforce their rights under the agreement against each other, providing more protection from the possibility of being squeezed out of the management of the company.

This Shareholder Agreement is intended to be used by shareholders of a Company which is yet to be established or which has only recently been incorporated or purchased “off the shelf” at the time of its execution. It provides for the immediate issue of new shares and, if necessary, the increase of the company’s share capital.

This Shareholder Agreement is well suited to family companies. It sets out the basic elements of the shareholders’ relationship with each other and includes the right to first refusal (pre-emption) for the parties should one shareholder wish to sell their shares, helping to prevent outside investors from muscling in on the company. The more detailed clauses regarding management and share transfers as well as non-competition provisions are excluded from this Basic Shareholder Agreement. For more detailed pre-emption provisions, please see the long version agreements.

We recommend that you use one of the Simply-docs Articles of Association with this Shareholder Agreement. Where other Articles are incorporated caution should be taken for inconsistencies between the two documents. However, as a result of Clause 17 of this Shareholder’s Agreement will prevail over the Articles in the event of an inconsistency.

Also available from the Simply-docs site and listed below under Related Documents are separate clauses which are ready to be incorporated into this agreement if required, including a deadlock provision and a shareholder employee dismissal clause, for use where an employee shareholder is dismissed or resigns.

Square brackets are used to denote optional words and phrases or an either/or choice.

This Basic Shareholder Agreement – New Company includes the following clauses:

1. Definitions and Interpretation
2. The Business of the Company
3. Issues on Completion
4. Administration
5. Finance
6. Financial Information
7. Issue of Shares
8. Transfer of Shares
9. Valuation of Shares
10. Shareholder Meetings
11. Company Communications
12. Management
13. Reserved Matters
14. Dividend Policy
15. Winding Up
16. Confidentiality
17. Conflict with the Articles
18. Duration
19. Notices and Service
20. No Partnership or Agency
21. No Waiver
22. Severance
23. Entire Agreement
24. Non-Assignment
25. Further Assurance
26. Costs
27. Applicable Law and Jurisdiction

Schedule 1: Investment
Schedule 2: Articles of Association
Schedule 3: Loan Agreements

This Basic Shareholder Agreement – New Company is in open format. Either enter the requisite details in the highlighted fields or adjust the wording to suit your purposes.

Shareholders Agreement checklist

The Shareholders Agreement Checklist can be used to help you instruct lawyers, or to help you complete the relevant Agreement.

It lists a range of simple questions (66) to enable you to focus on the principal legal and commercial issues that need to be considered when drafting a Shareholder Agreement including, taxation, investment sums, instruments and timing, security, borrowing, new issues, pre-emption rights and procedures, class of shares, sale of shares and new participants.

An Introducer fee for a single transaction tmeplate

This Introducer Agreement (Fee for Single Transaction) is for use where one party (a supplier of a goods or services) wishes to engage another as an introducer of clients or suppliers.

This Introducer Agreement is designed for use where the supplier wishes to secure a contract with only one client, perhaps in a new market or geographical region, who may be specifically identified or not. Where the target client is not named, the Prospective Client Criteria Schedule provides for the supplier to insert any requirements it may have of the new client that the introducer is to find.

An introducer differs from an agent as an introducer does not do any selling of the other party’s products or services themselves, but rather will refer a potential client on, either through simply informing the client of the goods or services provided by the supplier, or by actively passing contact details and so forth on to the supplier of the product. Once the introduction is made, the introducer steps back and will have no further role in the relationship between the supplier and the customer. The selling and supply remains the sole remit of the supplier.

This Introducer Agreement can be set up so as to operate on a fixed fee or percentage basis, with payment upon the introduction itself, upon the first transaction, or both.

If you require an agreement which creates a principal – agent relationship, you should use one of the agency agreements available from the related document links below.

If you require an agreement which is designed for the situation where the supplier is not targeting a specific client or type of client, but is instead seeking new custom generally, you should use one of the Commission or Referral Fee Agreements, available from the related document links below.

The fee clause can be arranged so as to effectively operate as a no win – no fee deal, where, if there is no agreement reached between the supplier and a prospective client, the introducer will not be entitled to a fee.

This agreement has not been created in accordance with FSA rules or the Financial Services and Markets Act 2000, and as such makes no reference or commitment to abiding by them. This agreement therefore is unsuitable for the introduction of clients for financial services, such as insurance products or investment advice.

This Introducer Agreement (Fee for Single Transaction) contains the following clauses:

1. Definitions and Interpretation
2. Appointment of Introducer
3. Method of Introduction
4. Obligations of the Company
5. Fees and Payment
6. Relationship of the Parties
7. Non Competition
8. Confidentiality
9. Non Circumvention
10. Termination
11. Nature of Agreement
12. Notices & Service
13. Set Off
14. Jurisdiction

And Schedules:
Schedule 1: Product Schedule
Schedule 2: Prospective Client Criteria

Optional phrases / clauses are enclosed in square brackets. These should be read carefully and selected so as to be compatible with one another. Unused options should be removed from the agreement.

This Introducer Agreement (Fee upon First Transaction) is in open format. Either enter the requisite details in the highlighted fields or adjust the wording to suit your purposes.

Introducer agreement templates for your use

This Introducer Agreement (Fee Upon Establishing Ongoing Business Relationship) is for use where one party (a supplier of a goods or services) wishes to engage another as an introducer of clients or new suppliers.

Continue reading →

Composing a Final Payment Reminder

The Final Payment Reminder letter (exc. CDA Interest) follows up the first late payment reminder. It requests payment by return or a written proposal to clear the debt. In the event of either of these two options not occurring the letter informs the debtor that the company may be obliged to take legal action.

Updated and co-ordinated records are essential to effective debt collection. An audit trail of credit related documents will facilitate prompt payment as well as establishing the indebtedness in the event of late or disputed payments and any subsequent legal action.

A number of template agreements are available to document a proposal to settle the debt, and, failing any agreed proposal, a “letter before action” sent to the debtor at the end of the grace period mentioned in this letter.

This Final Payment Reminder template is in open format. Either enter the requisite details in the highlighted fields or adjust the wording to suit your purposes.

This Employment Offer Letter can be applied to a wide variety of jobs where the employment is on the basis of a Fixed Term.

Enclosed with the Offer Letter should be the Particulars of Employment (Fixed Term Employment Contract).

This template is in open format. Either enter the requisite details in the highlighted fields or adjust the wording to suit your purposes.

Employment Offer Checklist

The Statutory Minimum Employment Agreement Checklist can be used to help you instruct lawyers, or to help you complete a contract of employment with the statutory minimum required terms and conditions of employment.

It lists a range of simple questions (43) to enable you to focus on the principal legal and commercial issues that need to be considered when drafting a Basic Employment Agreement.

Written details of specified particulars of employment must be provided to all employees within two months of starting employment.

Normally these terms and conditions of employment will be provided in the employment contract or in a separate written statement. These minimum requirements are often referred to as a Section One Statement.

This Basic Employment Agreement Checklist template is in fixed field format. Simply press TAB to jump from one field to the next and SHIFT TAB to go back. Alternatively, use the mouse to click from one field to the next.

If you are using Microsoft Office 2003 or older, the template can be unlocked by clicking on the “Padlock” icon on the tool bar. To display the “Padlock” icon click on “View” and then “Toolbars”. From the “Toolbars” menu, select “Forms”.

Users of Microsoft Office 2007 must first click on the “Review” tab to reveal the “Protect Document” button. From the “Permissions” panel that opens, click on the “Stop Protection” button.

Use of a Consultancy Agreement

This Consultancy Agreement is designed for use by a company (rather than a sole trader) whose staff or subcontractors carry out the consulting services. It is drafted in favour of the Provider of the consultancy services and to reflect current best practices.

The equivalent Consultancy Agreement for a Sole Trader or Freelance worker (not using a Service Company) is the Consultant Agreement (medium) – Provider Version.

Where further provisions (including insurance, specific clauses relating to premises and further contractual protection for the parties) are required parties please click on the relevant link at Related Documents below.

This Consultancy Agreement contains the following Clauses:-

1. Definitions and Interpretations
2. Appointment of the Consultant and Duration
3. Obligations of the Consulting Company
4. Fees and Expenses
5. Late Payment
6. Intellectual Property
7. Termination
8. Effects of Termination
9. Confidentiality
10. Relationship of Parties
11. No Waiver
12. Severance
13. Entire Agreement
14. Non – Assignment
15. Notices and Services
16. Applicable Law and Jurisdiction

Schedule
A. Scheduled Services
B. Time for Completion of Scheduled Services
C. Fees
D. Invoices and Receipts
E. Locations and Premises

What is a Commission Agreement?

Use our blog below to craft a commission agreement.

This Commission Agreement is for use where one party (a provider of goods or services) (the”Client”) wishes to engage another to introduce suppliers or customers in order to generate more sales and increase their customer base. The introducer will earn a commission in return for his efforts.

An introducer differs from an agent as he does not do any selling of his Client’s products or services themselves, but rather will refer a potential customer on, either through simply informing him of the goods or services provided by the Client, or by actively passing contact details and so forth on to the Client. Once the introduction is made, the commission earner steps back and will have no further role in the relationship between the Client and the customer. The selling and supply remains the sole remit of the Client.

If you require an agreement which creates a principal–agent relationship, you should use one of the agency agreements available from the related document links below.

This Commission Agreement is designed for use where the Client does not have in mind any one particular customer to target, but rather is simply seeking to obtain new customers and widen its client base, or sell into a new market. If you require an agreement which is designed for the situation where the Client is targeting a specific customer or type of customer, you should use one of the Introducer Agreements, available from the related document links below.

Under this Commission Agreement the commission earner will receive a fee or commission for all transactions that occur between any customer introducer by him and the Client within a set period. This differs from the Refferal Fee Agreement, available from the related document links below, which instead provides for a fee to be earned only in respect of the first transaction between the Client and the introduced customer.

Should the introducer fail to introduce new custom, he will earn no commission. In this respect this is a no win – no fee type agreement.

This agreement has not been created in accordance with FSA rules or the Financial Services and Markets Act 2000, and as such makes no reference or commitment to abiding by them. This agreement therefore is unsuitable for the introduction of clients for financial services, such as insurance products or investment advice.

The Commission Agreement contains the following clauses:

1. Definitions and Interpretation
2. Appointment of Introducer
3. Introduction of Prospective Clients
4. Obligations of the Company
5. Fees and Payment
6. Relationship of the Parties
7. Non Competition
8. Confidentiality
9. Non Circumvention
10. Termination
11. Nature of Agreement
12. Notices & Service
13. Set Off
14. Jurisdiction

And Schedules:

Schedule 1: Commission Schedule
Schedule 2: Product Schedule

Optional phrases / clauses are enclosed in square brackets. These should be read carefully and selected so as to be compatible with one another. Unused options should be removed from the agreement.

This Commission Agreement is in open format. Either enter the requisite details in the highlighted fields or adjust the wording to suit your purposes.