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Family Business Shareholders Agreement
"I need a Family Business Shareholders Agreement for our third-generation manufacturing business, where ownership will be transferred to five family branches by March 2025, with provisions for a newly established Family Council and clear dispute resolution mechanisms."
1. Parties: Identifies all shareholders, including family members and any non-family shareholders, and the company itself
2. Background: Sets out the context of the family business, its history, and the purpose of the agreement
3. Definitions and Interpretation: Defines key terms including 'Family Members', 'Family Group', 'Business', and other relevant terms
4. Business of the Company: Describes the nature of the business and any restrictions on business activities
5. Management and Decision Making: Details the management structure, board composition, and decision-making processes
6. Family Council: Establishes the Family Council structure, its composition, and role in business governance
7. Share Rights and Restrictions: Details the rights attached to shares and restrictions on their transfer
8. Share Transfer Provisions: Sets out the process for transferring shares, including pre-emption rights and family-first provisions
9. Succession Planning: Outlines the succession planning framework and transition of ownership/management
10. Dividend Policy: Establishes the approach to dividend distributions and reinvestment
11. Employment of Family Members: Sets conditions and policies for family member employment in the business
12. Dispute Resolution: Details the process for resolving disputes between family members/shareholders
13. Confidentiality: Defines confidentiality obligations regarding business and family matters
14. Duration and Termination: Specifies the term of the agreement and circumstances for termination
1. Family Member Loans: Used when family members provide loans to the business, detailing terms and repayment conditions
2. Incapacity Provisions: Include when specific provisions for managing shares in case of shareholder incapacity are needed
3. Next Generation Involvement: Used when specific provisions for involving younger family members in the business are required
4. Family Values and Ethics: Include when the family wants to embed specific values or ethical principles in business operations
5. External Directors: Used when non-family directors are or may be appointed to the board
6. Intellectual Property Rights: Include when family members contribute intellectual property to the business
7. Family Member Exit Strategy: Used when specific provisions for family members wishing to exit the business are needed
8. Corporate Social Responsibility: Include when the family business has specific commitments to social responsibility
1. Schedule 1: Details of Shareholders: List of all shareholders, their shareholdings, and family relationships
2. Schedule 2: Share Rights: Detailed description of different share classes and associated rights
3. Schedule 3: Reserved Matters: List of decisions requiring special majority or family council approval
4. Schedule 4: Family Employment Policy: Detailed policies regarding employment of family members
5. Schedule 5: Valuation Methodology: Agreed method for valuing shares for transfer purposes
6. Schedule 6: Family Council Charter: Detailed rules governing the Family Council operation
7. Schedule 7: Deed of Adherence: Template for new shareholders to sign up to the agreement
8. Schedule 8: Family Constitution: Core family values, vision, and governance principles
Authors
Retail
Manufacturing
Agriculture
Hospitality
Construction
Professional Services
Food and Beverage
Real Estate
Technology
Healthcare
Transport and Logistics
Wholesale Distribution
Automotive
Education Services
Legal
Corporate Governance
Family Office
Board of Directors
Family Council
Executive Management
Human Resources
Finance
Compliance
Strategic Planning
Succession Planning
Risk Management
CEO
Managing Director
Family Council Chair
Board Director
Company Secretary
Chief Financial Officer
Family Office Manager
Succession Planning Manager
Corporate Governance Officer
Head of Family Business
General Counsel
Business Development Director
HR Director
Family Business Advisor
Wealth Manager
Next Generation Program Director
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