A neutral-form two-party shareholders' agreement for a joint venture private limited company incorporated under the Companies Act 2006 in England & Wales.
How to use this template, read this first - Replace every
[SQUARE-BRACKET]field before use. - A shareholders' agreement sits alongside the company's articles of association and governs the relationship between the owners. Where it conflicts with the articles, consider which should prevail and align them, the articles are public (filed at Companies House); the shareholders' agreement is private. - Have a solicitor review before use, and amend the articles to match.
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THIS SHAREHOLDERS' AGREEMENT is made on [DATE]
BETWEEN (1) [SHAREHOLDER A] of [ADDRESS]; (2) [SHAREHOLDER B] of [ADDRESS]; and (3) [COMPANY NAME] (no. [NUMBER]) (the "Company").
Agreed terms
1. The joint venture. The parties hold shares in the Company as follows: [A: __% ; B: __%]. The Company's business is [DESCRIBE].
2. Capital and funding. Initial funding is [DESCRIBE]. Further funding will be provided [as agreed / pro rata]; no shareholder is obliged to provide funding unless agreed in writing.
3. The board. Each shareholder may appoint [NUMBER] director(s). The quorum for board meetings requires [a director appointed by each shareholder]. The chair [has / does not have] a casting vote.
4. Reserved matters. The Company will not, without the prior written consent of [both shareholders / each shareholder holding __%], do any of the following: change its business; issue or buy back shares; borrow above £[AMOUNT]; dispose of material assets; pay dividends contrary to clause 6; enter related-party transactions; or change its constitution. (Set out the full list in Schedule 1.)
5. Share transfers. No shareholder may transfer shares except as permitted. Any proposed transfer is subject to pre-emption rights (existing shareholders may buy first), and on a sale of control, tag-along (minority can join) and drag-along (majority can require minority to sell) rights apply as set out in Schedule 2.
6. Dividends. The Company will [distribute [__]% of distributable profits annually, subject to working-capital needs / retain profits as the board agrees].
7. Good leaver / bad leaver. Where a shareholder who is also involved in the business leaves, their shares are dealt with as set out in Schedule 3 (valuation depending on circumstances).
8. Confidentiality and non-compete. Each shareholder will keep the Company's affairs confidential and, while a shareholder and for [NUMBER] months afterwards, will not compete with the Company, so far as reasonable.
9. Dispute resolution. Disputes are referred to [escalation between senior representatives, then mediation] before court proceedings.
10. Governing law and jurisdiction. This Agreement is governed by the law of England and Wales, whose courts have jurisdiction.
Execution
Signed by [SHAREHOLDER A] / [SHAREHOLDER B] / for [COMPANY]: __________________ Date: [DATE]
Schedules: 1, Reserved matters · 2, Transfer provisions (pre-emption, tag/drag) · 3, Leaver provisions
--- This template is a starting point and not legal advice. A shareholders' agreement must be aligned with the company's articles, have a qualified solicitor review and adapt both before use. Governing law: England & Wales.