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Stock Agreement
I need a stock agreement for a private company issuing shares to a new investor, detailing the number of shares, price per share, and vesting schedule. The agreement should include provisions for transfer restrictions, rights of first refusal, and compliance with Austrian corporate laws.
What is a Stock Agreement?
A Stock Agreement sets out the rules and conditions for buying, selling, or transferring company shares in Austria. It protects both shareholders and the company by clearly defining key terms like share prices, transfer restrictions, and voting rights under Austrian corporate law (Aktiengesetz).
These agreements play a vital role in Austrian businesses, especially for startups and family-owned companies. They help prevent unwanted third-party acquisitions, establish exit procedures, and outline shareholder obligations. Most Austrian Stock Agreements include specific provisions for pre-emptive rights (Vorerwerbsrecht) and tag-along rights to safeguard minority shareholders.
When should you use a Stock Agreement?
Create a Stock Agreement when starting a new company in Austria or bringing in new shareholders. This agreement becomes essential during major ownership changes, like when selling shares to investors, transferring ownership to family members, or setting up employee stock options under Austrian corporate regulations.
The timing matters most when planning significant company changes: mergers, acquisitions, or restructuring efforts. Austrian businesses particularly need these agreements before accepting venture capital, launching an IPO, or establishing succession plans for family enterprises. Having clear stock terms in place helps avoid costly disputes and protects both majority and minority shareholder interests.
What are the different types of Stock Agreement?
- Phantom Stock Agreement: Creates synthetic equity rights without actual share ownership, popular for employee incentives in Austrian startups
- Stock Transfer Agreement: Handles direct share transfers between parties, common in M&A and succession planning
- Shares Agreement: Comprehensive framework for managing shareholder rights and obligations under Austrian law
- Employee Stock Option Agreement: Grants employees future rights to purchase company shares at set prices
- Profit Split Agreement: Defines how company profits are distributed among shareholders, often used in partnerships
Who should typically use a Stock Agreement?
- Company Founders: Establish initial Stock Agreements when forming Austrian corporations, setting core ownership structures and rights
- Corporate Lawyers: Draft and review agreements to ensure compliance with Austrian corporate law and protect client interests
- Board Members: Approve and oversee stock-related decisions, especially for publicly traded companies
- Shareholders: Both majority and minority owners bound by the agreement's terms for share transfers and voting rights
- Investment Firms: Negotiate specific terms when investing in Austrian companies, often requiring special rights or protections
- Company Secretaries: Maintain and update stock records, ensuring proper documentation of ownership changes
How do you write a Stock Agreement?
- Company Details: Gather current articles of association, shareholder registry, and corporate registration documents
- Share Structure: Document total shares, classes, existing rights, and current ownership percentages
- Transfer Terms: Define price calculation methods, payment terms, and any transfer restrictions
- Voting Rights: Outline decision-making processes and majority requirements under Austrian law
- Exit Provisions: Specify procedures for share sales, tag-along rights, and drag-along rights
- Digital Template: Use our platform to generate a customized Stock Agreement that meets Austrian legal requirements
- Internal Review: Have key stakeholders verify all terms before finalizing the agreement
What should be included in a Stock Agreement?
- Parties and Recitals: Full legal names, addresses, and roles of all shareholders and the company
- Share Details: Clear description of share classes, numbers, and nominal values per Austrian law
- Transfer Mechanics: Procedures for selling shares, including pre-emptive rights and valuation methods
- Voting Rights: Decision thresholds and procedures aligned with Aktiengesetz requirements
- Drag-Along Rights: Terms for majority shareholders to force minority participation in sales
- Tag-Along Rights: Protection for minority shareholders during ownership changes
- Dispute Resolution: Austrian jurisdiction clause and mediation procedures
- Termination Terms: Clear conditions for agreement modification or termination
What's the difference between a Stock Agreement and a Stock Purchase Agreement?
A Stock Agreement differs significantly from a Stock Purchase Agreement in Austrian corporate law. While both deal with company shares, they serve distinct purposes and apply in different scenarios.
- Scope and Duration: Stock Agreements provide ongoing governance rules for all shareholders, while Stock Purchase Agreements only cover a single transaction
- Legal Framework: Stock Agreements align with Austrian corporate governance requirements (Aktiengesetz), whereas Purchase Agreements focus on commercial transaction law
- Content Focus: Stock Agreements include voting rights, transfer restrictions, and shareholder obligations; Purchase Agreements detail price, payment terms, and warranties for one specific sale
- Party Involvement: Stock Agreements bind all shareholders continuously; Purchase Agreements only involve the buyer and seller for a specific transaction
- Modification Rules: Stock Agreements typically require majority shareholder approval to modify; Purchase Agreements are complete once the transaction closes
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