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Jaspreet Potter, a solicitor at IBB solicitors, explains that a shareholders agreement is a contract between a company and its shareholders to govern their relationship, rights, and obligations. This agreement, along with the company's articles of association, sets internal rules for all parties to follow, aiming to prevent disputes. It is advised to establish a shareholders agreement early on, ideally when the company is incorporated or starts trading, to easily address important matters before the business is fully operational. This proactive approach saves time and effort compared to resolving disputes later on.
