Clean look in the Shareholders Agreement

Aug 6th, 2022
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How to clean look in the Shareholders Agreement

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hi Im So Young head of legal here at jungle Ventures and I want to take some time to talk to you about investment documents so long form definitive documents for VC or other big investor into a founder-led company [Music] sha shells agreement thats the document that comes after the term sheet to talk about how everyones going to live together going forward so the most important thing to think about is that its necessarily a relatively long and complex document its a 50 plus page document the question that you should have as a Founder is how can I do this as efficiently as possible with as little loss of sleep as little stress the thing to think about in this context is process really drives how good the outcome is going to be and the process that you want being the most efficient process as a Founder is to concentrate just on the core issues dont get hung up on drafting let your lawyers do that you need to isolate what is really important to you and have you know real honest conv

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Exit Strategy: The agreement should include an exit strategy for each shareholder, including what happens if a shareholder wants to sell their shares, retire or die. Dispute Resolution: The agreement should outline a process for resolving disputes between shareholders, such as mediation or arbitration.
The shareholders agreement should outline how often the board will meet, and how shareholders can make decisions to manage the business. Most importantly, it should outline what will happen if a deadlock occurs and how disagreements will be resolved.
A shareholders agreement includes a date; often the number of shares issued; a capitalization table that outlines shareholders and their percentage ownership; any restrictions on transferring shares; pre-emptive rights for current shareholders to purchase shares to maintain ownership percentages (for example, in the
The shareholders agreement should specify the chosen dispute resolution mechanism, the process for initiating the dispute resolution, and the forum for the resolution of the dispute.
Pre-emptive rights: A key clause in a shareholder agreement is the right of current shareholders to buy any newly issued shares before it is opened up to third parties. This clause helps protect existing shareholders from losing their share value.
A shareholders agreement (SHA) is a contract between a companys shareholders and often the company itself. A SHA specifies shareholders rights and obligations, regulates the management of the company, ownership of shares, privileges, voting and various protective provisions for shareholders.
Key Terms Parties. Each shareholder will ideally be a party to the contract. Company Background. This term indicates the company in question and information on its share capital. Definitions. Business of the Company. Shareholder Obligations. Dividend Policy. Transfer of Shares. Issue of New Shares.

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