Copy signature in the Shareholder Agreement

Aug 6th, 2022
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When an individual executes a deed, their signature must be witnessed. A party to a deed cannot be a witness to another signature to that deed.
A shareholders agreement is no different from any other form of contract and so can become binding on shareholders because it has been agreed to by all of them either orally, in writing (but not formally signed) or by conduct.
Since a shareholders agreement establishes the relationship between the shareholders, without one, you are exposing both shareholders and the company to potential future conflict. This is particularly true in situations where the voting shares in a company are held equally (50% each) by just two people or companies.
Sign to make it legal Print a copy of the Shareholders Agreement for each shareholder and one for the company directors. All shareholders should sign each copy of the Agreement. Each signature must be witnessed. The chosen company director(s) must also sign each copy on behalf of the company.
In the absence of this in an agreement, disputes will generally go on for longer, will need to be resolved through litigation, which can be costly and time-consuming. Shareholders rights: Standard articles come with only one class of share which carries equal rights.
Go to court. If all else fails and a breakthrough cannot be achieved in any other way, the shareholders could refer the matter to the court to resolve the dispute or potentially order a winding up of the company. This is a costly option, and some cases can take years to get to trial.
So shareholder agreements can be signed as a normal agreement and not as a deed and still be legally binding. However some companies choose to sign their shareholder agreement as a deed for a number of reasons.
As this is a contract between shareholders, only the parties to the agreement can be bound by its terms. This means that in the event of any disputes, the provisions and other remedies set out in the shareholders agreement cannot be enforced against any shareholder who has not signed up to it.

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