Syndicate Legal Advisory Services prepares custom shareholders’ agreements for corporations in any U.S. state, whether as the original agreement adopted at or after formation, as an agreement for an existing corporation whose shareholders have been operating without one, as the shareholders’ agreement component of a financing or founder arrangement, or as an amendment or restatement of an agreement already in force. A shareholders’ agreement is the contract among the shareholders — and usually the corporation — that governs their relationship with one another in ways the charter and bylaws cannot: who sits on the board and how major decisions are made, how and to whom shares may be transferred, what happens when a shareholder dies, leaves, or wants out, how new capital is raised and existing shareholders are protected from dilution, and how disputes and deadlocks are resolved. For a closely held corporation it is the single most important governance document; for a venture-backed corporation its provisions are usually divided among the investor-rights, voting, and right-of-first-refusal and co-sale agreements, which this engagement can prepare as one integrated agreement or as separate documents. Working from the client’s answers to a structured intake and from the corporation’s charter, bylaws, and capitalization records, we draft the agreement written for the shareholders’ specific circumstances and consistent with the charter, the governing statute, and the corporation’s other agreements, together with the approvals, legends, and records that make it effective. State filing fees, where a related charter amendment is required, and other third-party charges are not included in the flat fee and are the sole responsibility of the client.
Scope of work includes:
Objective planning and intake — a structured intake and written summary confirming the corporation’s type, state, and tax classification; the shareholders, their classes and holdings, their roles as directors, officers, or employees, and their family and estate circumstances; the governance objectives — board composition and designation rights, the matters requiring shareholder or supermajority approval, and the protection of minority holders; the transfer and exit objectives — the permitted transfers, the right of first refusal or first offer, co-sale and drag-along rights, and the buy-sell events, valuation, and funding; the capital-raising objectives — pre-emptive rights, anti-dilution protection, and the treatment of future financings; the dividend and distribution policy; the information and inspection rights beyond what the statute provides; the employment-related provisions for shareholder-employees; the dispute-resolution and deadlock mechanisms; whether the corporation will be a party; the term and termination events; and the S-corporation eligibility safeguards where that election is in place.
Review of existing documents — review of the charter and bylaws, the capitalization table and stock ledger, any existing shareholders’, voting, buy-sell, investor-rights, or employment agreements, the equity incentive plan and award agreements, prior consents, and the statute’s provisions on shareholders’ agreements (including the close-corporation or statutory shareholders’-agreement provisions that allow the agreement to override the bylaws or dispense with a board), with a written summary of the provisions the agreement must conform to or that must be amended to accommodate it and the gaps or conflicts in the existing arrangements.
Custom shareholders’ agreement — drafting of the agreement in full, addressing: the parties, the shares subject to the agreement, and after-acquired shares; governance — the size and composition of the board, the designation rights of founders, investors, or classes, the removal and replacement of designees, the voting covenants, the officers and their authority, the matters requiring shareholder, supermajority, or specified-holder approval (a sale, merger, or dissolution; charter or bylaw amendments; new classes of stock or issuances above a threshold; debt, capital expenditures, or related-party transactions above a threshold; changes in the business; hiring or compensation of senior officers; and the like), the quorum and meeting mechanics, and the deadlock-resolution procedure (mediation, a casting vote, a shotgun buy-sell, or dissolution); transfers — the general restriction, the permitted transfers and joinders, the right of first refusal or first offer with its notice, election, allocation, and closing mechanics, the co-sale or tag-along right, and the drag-along right with its conditions and minority protections; buy-sell — the triggering events (death, disability, retirement, termination of employment with or without cause, divorce, bankruptcy, involuntary transfer, and breach), the mandatory or optional purchase for each, the valuation method and the annual agreed-value certificate, the payment terms and promissory note, the insurance funding, and the closing mechanics; capital — pre-emptive rights on new issuances and the exempted issuances, anti-dilution protection where agreed, capital-call or guaranty obligations where the shareholders assume them, and the dividend policy and tax-distribution covenant for an S corporation; information rights — financial statements, budgets, and inspection; the covenants of shareholder-employees — confidentiality, non-competition and non-solicitation where enforceable, and assignment of inventions; the S-corporation safeguards — eligible-holder and single-class restrictions and the consent to the election and its continuation; the legend and the corporation’s covenant to refuse non-compliant transfers; representations; the term, termination on a qualified public offering, sale, or other specified event, and the survival of provisions; specific performance and remedies; and the amendment, waiver, notice, governing-law, and dispute-resolution provisions, with the spousal consent and the provisions binding estates, trustees, and successors.
Separate agreements (where the venture format is used) — the investor-rights agreement (registration rights, information rights, pre-emptive rights, and covenants), the voting agreement (board designation and drag-along), and the right of first refusal and co-sale agreement, drafted as a consistent set with the certificate of designation and stock purchase agreement, coordinated with the firm’s related services.
Approvals and conforming documents — the board resolutions approving the corporation’s execution of the agreement and the legend, the shareholder consents where required, the spousal consents and joinders, the updated stock ledger with the legend notation and reissued certificates where used, the conforming amendments to the charter or bylaws where the agreement requires them (coordinated with the firm’s amendment services), the insurance and funding documents for the buy-sell provisions, and the notifications to lenders, insurers, and the transfer agent whose consent or notice the agreement requires.
Deliverable: a complete, indexed shareholders’ agreement file (electronic and hard copy) containing the written summary of the review, the executed shareholders’ agreement (or the integrated set of investor-rights, voting, and ROFR/co-sale agreements), the approvals, spousal consents, and joinders, the conforming documents and updated ledger, the funding documents where included, and the compliance calendar, with a signature-ready version of each document for execution by the shareholders, their spouses, and the corporation.