Incorporation Pro
Member of Corporations Canada
647-945-8873

Login

Lost your password?

Register

0$0.00

No products in the cart.

  • Incorporate
    • Standard Corporation
      • Ontario Corporation
      • BC Corporation
      • Alberta Corporation
      • Federal Corporation
      • Quebec Corporation
      • SK Corporation
      • NB Corporation
      • Manitoba Corporation
      • NL Corporation
      • NS Corporation
      • PEI Corporation
      • Nunavut Corporation
      • NWT Corporation
      • Yukon Corporation
    • Professional Corp
      • Ontario Professional
      • BC Professional
      • Alberta Professional
      • Quebec Professional
      • NB Professional
      • SK Professional
      • MB Professional
      • NL Professional
      • NS Professional
      • Nunavut Professional
      • NWT Professional
      • PEI Professional
      • Yukon Professional
    • Special Corporations
      • Ontario PREC
      • Ontario Co-operative
      • BC PREC
      • BC Co-operative
      • BC Benefit Company
    • Extra Provincial Registration
    • Shelf Corporations
  • Non-Profit
    • Federal Non Profit
    • Ontario Not-for-Profit
    • BC Society
    • Alberta Non Profit
    • Quebec Non Profit
    • NB Non Profit
    • NS Non Profit
    • NL Non Profit
    • PEI Non Profit
    • SK Non Profit
    • Manitoba Non Profit
    • Yukon Non Profit
  • Registry
    • Master Business Licence
    • Sole Proprietorship
    • Trade Name or DBA
    • Partnership
      • General Partnership
      • Limited Partnership (LP)
      • Limited Liability Partnership (LLP)
  • Search
    • NUANS® Report
    • Name Pre Search
    • Corporate Profile Report
    • Company Key
    • Certificate of Status
    • Certificate & Article
    • Other Corporate Records
  • Filing
    • Notice of Change
    • Annual Return
    • Initial Return
    • Dissolution
      • Dissolve a Corporation
      • Dissolve Sole Proprietorship
      • Dissolve an MBL
      • Dissolve a Partnership
      • Dissolve a Trade Name
    • Corp. Name Change
    • Continuance
    • Articles of Amend.
    • Business Update
    • Revive a Corporation
    • Mandatory Filing
  • Trademark
    • Canada Trademark
    • US Trademark
    • EU Trademark
    • Canada TM Renewal
    • Modify an Order
    • TM Amendment
    • TM Search Report
  • Copyright
    • Copyright Registration
    • Copyright Correction
    • Copyright Search
    • Copyright Records
  • Supports
    • CRA & WCB
      • CRA Accounts
      • WCB All Provinces
      • Charity Status
    • Corporate Supplies
      • Minute Book
      • 1 Year Support
      • Corporate Seal
      • Share Certificates
      • Address Service
      • Agent for Service
    • Domain Name
    • Logo Design Service
    • Legal Contracts
    • Accounting Supports
    • Add in Package
    • Service Upgrade
      • Service Speed Queue
      • BC Priority Queue
      • Minutebook Upgrade
      • Customized Article
      • Professional Corp
  • Non-Resident
    • Guidelines
    • Offshore Company
    • LP in Ontario
    • LP in BC
    • LLC in Ontario
    • Extra Provincial
    • Subsidiary Corporation
  • All

Shareholder Agreement

  • Home
  • Others
  • Shareholder Agreement

Step 1 of 13 - Corporate Details

7%
  • Corporation Details

  • We have our own Legal team who will prepare the Shareholder Agreement. We have made it very simple and easy. All you need to do is, filling out this step by step form, pay and submit. Our specialist will review your submitted information, will contact you if anything is missing.
  •  Built for Alberta
    Different provinces have different rules and regulations. Your Shareholder Agreement will be customized for Alberta
  •  Built for British Columbia
    Different provinces have different rules and regulations. Your Shareholder Agreement will be customized for British Columbia.
  •  Built for Manitoba
    Different provinces have different rules and regulations. Your Shareholder Agreement will be customized for Manitoba
  •  Built for New Brunswick
    Different provinces have different rules and regulations. Your Shareholder Agreement will be customized for New Brunswick.
  •  Built for Newfoundland and Labrador
    Different provinces have different rules and regulations. Your Shareholder Agreement will be customized for Newfoundland and Labrador.
  •  Built for the Northwest Territories
    Different provinces/territories have different rules and regulations. Your Shareholder Agreement will be customized for the Northwest Territories.
  •  Built for Nova Scotia
    Different provinces have different rules and regulations. Your Shareholder Agreement will be customized for Nova Scotia.
  •  Built for Nunavut
    Different provinces/territories have different rules and regulations. Your Shareholder Agreement will be customized for Nunavut.
  •  Built for Ontario
    Different provinces have different rules and regulations. Your Shareholder Agreement will be customized for Ontario.
  •  Built for Prince Edward Island
    Different provinces have different rules and regulations. Your Shareholder Agreement will be customized for Prince Edward Island.
  •  Built for Quebec
    Different provinces have different rules and regulations. Your Shareholder Agreement will be customized for Quebec.
  •  Built for Saskatchewan
    Different provinces have different rules and regulations. Your Shareholder Agreement will be customized for Saskatchewan.
  •  Built for the Yukon Territory
    Different provinces/territories have different rules and regulations. Your Shareholder Agreement will be customized for the Yukon Territory.
  • General Guidelines

  • What is a close corporation?
    A close corporation usually has the following characteristics:
    • A corporation that is owned by a limited number of shareholders (1 - 35)
    • Shareholders are generally active in the affairs of the corporation
    • There is no ready market for the sale of corporate shares
  • Shareholder Details

  • Second shareholder

  • Third shareholder

  • Fourth shareholder

  • Fifth shareholder

  • General Guidelines

  • Who are the parties to the Shareholder Agreement?
    -The parties to a Shareholder Agreement are the shareholders of the corporation.
    -Ideally, all shareholders will participate in the Shareholder Agreement.
  • Shareholder Details

  • Warranties
  • Share Ownership

  • Second shareholder

  • Third shareholder

  • Fourth shareholder

  • Fifth shareholder

  • General Guidelines

  • Why do we need a list of shareholders?
    This warranty confirms for the shareholders how many shares have been issued and who owns those shares.
  • Why do we need shareholders to warrant that they are the beneficial owners of their shares?
    -When a shareholder warrants that they are the beneficial owner of their shares, this means that no other person has an interest in those shares nor are they held in trust for someone else.
    -This warranty provides additional assurance to other shareholders and creditors regarding who really owns and controls the corporation.
  • Directors of Corporation

  • Shareholders Will Vote to Elect Directors

  • What are the names of your designated directors?
  • Date Format: MM slash DD slash YYYY
  • Second director

  • Date Format: MM slash DD slash YYYY
  • Third director

  • Date Format: MM slash DD slash YYYY
  • Fourth director

  • Date Format: MM slash DD slash YYYY
  • Fifth director

  • Date Format: MM slash DD slash YYYY
  • General Guidelines

  • Why would I want the Shareholder Agreement to provide direction on director selection?
    -It is important to have fair representation on the board of directors for both majority shareholders and minority shareholders.
    -It should be noted that all directors have a duty to act in the best interest of the corporation no matter how they were elected.
  • Alternate Directors

  • What are the names of your alternate directors? (In order of preference)
  • Second alternate director

  • What are the names of your Second alternate director? (In order of preference)
  • Third alternate director

  • What are the names of your Third alternate director? (In order of preference)
  • Fourth alternate director

  • What are the names of your Fourth alternate director? (In order of preference)
  • Fifth alternate director

  • What are the names of your Fifth alternate director? (In order of preference)
  • Officers of the Corporation

  • General Guidelines

  • Why would I want to specify the officers of the company?
    -Specifying the officers of the corporation may prevent subsequent shareholders from firing your officers even if they acquire a majority share or control of the board of directors. This may provide a level of managerial consistency to the company.
    -However, for the same reason, specifying the officers may also prevent the company from attracting new investors who want to install their own management team to run the corporation.
  • Management of the Corporation

  • Capital and Assets
  • Shares and New Share Issues
  • Additional Management Clauses
  • General Guidelines

  • Who will manage the company?
    -Generally, the directors will make most of the decisions affecting the management of the company.
    -However, selecting specific management issues in the Shareholder Agreement preserves the right of the shareholders to maintain control over issues vital to the corporation.
    -You should identify all those items over which the shareholders should maintain control.
  • Why auditor for the corporation?
    An auditor is a qualified accountant who performs a systematic examination of the accounting records of a corporation in order to ensure accuracy and compliance with established accounting policies and procedures.
  • Why Financial assistance?
    -Financial assistance refers to any gift of money, loan or guarantee of a loan that the corporation might provide to any shareholder, officer, director, or employee.
    -This type of assistance would typically be expressly forbidden in the corporate bylaws or in the articles of incorporation. This does not include wages, salaries, benefits, or bonuses.
    -This includes shareholders, officers, directors and employees.
  • Why Capital expenditures?
    -A capital expenditure is money spent to acquire or upgrade physical assets such as buildings and machinery.
    -Requiring shareholder approval of large capital expenditures will protect the shareholders' investment from the poor judgment of an officer or employee.
    -The amount of the limit will depend upon the size and resources of your corporation as well as the shareholders' confidence in its management.
  • Why Security interests?
    -A security interest is an interest in corporate property that is granted to a creditor. This is normally used to obtain a loan that the creditor would not be willing to give without some sort of security. A security interest may also be created by an operation of law to ensure the performance of the obligation where a debtor has defaulted on a debt.
    -If corporate property is encumbered it means that an interest in the property is granted to another party as security for the fulfillment of some obligation.
  • Why corporate asset?
    A corporate asset is any property owned by the corporation. This includes, but is not limited to, money, real estate, and equipment.
  • Why Redemption of shares?
    Share redemption is when the corporation purchases its own shares from the market or from a shareholder.
  • Why Issue of shares?
    -Issuing shares is where a corporation places shares for sale either on the open market or privately to individuals.
    -Corporations will sometimes issue shares for non-monetary considerations when they are trying to attract top level professionals and skilled workers to the corporation or when they are trying to raise capital to purchase property.
  • Duration of the Agreement

  • Date Format: MM slash DD slash YYYY
  • Date Format: MM slash DD slash YYYY
  • General Guidelines

  • When should my Shareholder Agreement end?
    -The Shareholder Agreement can end when all shareholders agree to end it, or on a specific date. The option to end it 'by shareholder agreement' should only be used in the following circumstance:
    • Where there are a relatively small number of shareholders;
    • Where the Corporation is not thinking of taking on new shareholder, and
    • Where the shareholders have a good working relationship.
    -Even one disgruntled shareholder could cause significant problems for the corporation by refusing to terminate the agreement, even where it would be in the best interest of the corporation to do so.
    -If there are a relatively large number of shareholders, or where the corporation is trying to increase the number of shareholders, or if the potential exists for conflict among the shareholders, then the Shareholder Agreement should have a specific end date.
  • Other

  • Capital Requirements of the Corporation
  • Preemptive Rights
  • Restrictions on Transfer of Shares
  • General Guidelines

  • What is the difference between a shareholder loan and a purchase of Shares?
    -When a shareholder purchases shares, the shareholder increases their equity in the company.
    -When a shareholder makes a Shareholder Loan to the company, it is a personal debt owed to the shareholder by the company, as though both were private individuals. That debt must be repaid, but it does not increase the shareholder's equity in the company.
  • What are pre-emptive rights?
    -Pre-emptive rights give existing shareholders the right to buy any newly issued shares from the corporation before shares are offered to outside (third) parties. This protects existing shareholders by allowing them to retain their percentage of ownership in the company.
    -Disadvantages of pre-emptive rights are that they may cause long delays in the sale of shares, and that they may discourage sophisticated institutional investors from investing because the third party investors may get a smaller proportionate share of the corporation than they might want if the pre-emptive rights are exercised.
  • Other

  • Valuation of Shares
  • General Guidelines

  • What is a valuation clause and why do I need it?
    -A valuation clause provides a method to determine the value of the corporation's shares. This process will be needed when a shareholder wants to sell his or her shares or when a shareholder dies and the other shareholders want to buy those shares.
    -Since most small corporations are private (not traded on a public stock exchange), the share value can be hard to determine without a predetermined method. Having this clause will reduce the uncertainty and disagreements that can occur.
  • Why would I need a professional valuator?
    -Shares that are not publicly traded on a stock market are hard to valuate because they are not easily convertible to cash.
    -Valuating the shares yourself may lead to a large over-or-under valuation. Either mistake can be detrimental to the company and to all affected shareholders.
    -A professional will give a more accurate valuation that is fair to all shareholders. However, you must consider the additional expense of a professional valuator.
  • Other

  • Dividends
  • Death or Incapacity of a Shareholde
  • Conflict of Interest
    • Non-compete Clause
    • Non-solicitation Clause
  • General Guidelines

  • What is a non-compete clause?
    -A non-compete clause prohibits shareholders from competing with the corporation while they are owners in the corporation and for a short period after they have left the corporation.
    -In a small corporation, customers deal closely with the shareholder. A non-compete clause prevents an influential shareholder or former shareholder from attracting customers away from the corporation.
    -A shareholder that leaves the corporation may also possess confidential information that can be used to compete against the corporation.
  • What is a non-solicitation clause?
    -A non-solicitation clause prevents shareholders or former shareholders from inducing other shareholders, directors, officers or employees to leave the corporation or to compete against it.
    -This clause prevents an influential shareholder from stealing key employees.
  • Other

  • Dispute Resolution
  • General Guidelines

  • What is the difference between mediation and arbitration?
    -Mediation is a process by which a neutral third party, the mediator, assists the conflicting parties in negotiating an agreement regarding the issue in conflict.
    -Arbitration is a process by which the conflicting parties present their conflict to a neutral third party who decides on how to resolve the issue.
  • When would the use of a mediator or arbitrator to settle disputes be beneficial?
    -A mediator or arbitrator should be used when the parties are at a deadlock over an issue. Mediation and arbitration are superior processes when there is a long term relationship involved and the survival of the business relationship is desirable.
    -If the dispute is not resolved and goes to court, a judge may decide on a compromise that is not desirable to either party, possibly to dissolve the company. But, if both parties agree to choose a neutral third party mediator or arbitrator to resolve the dispute, the business relationship may be able to continue successfully.
  • Why a shotgun clause?
    -A shotgun clause provides an escape mechanism for shareholders if there is a serious dispute that cannot be resolved.
    -In a shotgun provision, one shareholder may offer to buy the other shareholder's shares for a certain price. A shotgun clause stipulates that the other shareholder may either sell his/her shares at that price, or buy the offering shareholder's shares at that same price. This process provides incentive for the offering shareholder to name a fair price.
    -However, if shareholders have unequal financial resources or if one shareholder would not be able to manage the company by his or herself, one shareholder could be at an advantage and offer an unfairly low price. For that reason, the shotgun clause favours shareholders with stronger financial resources, and greater ability to run the company by his or herself.
  • Why right of first refusal clause?
    -A right of first refusal requires that when an existing shareholder wants to sell his shares, all shares must first be offered to existing shareholders on a pro rata basis.
    -A right of first refusal allows the existing shareholders to retain their percentage stake in the corporation. It also helps protect existing shareholders from unwelcome new shareholders.
    -If the existing shareholders cannot afford to buy the shares, the shares may still be sold to the third party.
  • Why a tag-along clause?
    -A tag-along clause (also called "piggyback" rights) protects minority shareholders in the event of a third party buyout.
    -If a majority shareholder sells his/her shares to a third party, the minority shareholder will have the right to become part of the transaction and sell his/her shares to the same third party purchaser at the same price and on similar terms.
    -Thus, the third party, if they wish to purchase the shares, must be prepared to purchase ALL of the outstanding shares.
  • Signing Details

  • Date Format: MM slash DD slash YYYY
  • Price: $ 299.00 CAD
  • {all_fields}
Our Offices
  • Toronto: 200-55 Village Centre Pl, Mississauga
  • Montréal: 710-5455 De Gaspe Ave
  • Vancouver: 1248-13351 Commerce Pkwy, Richmond
  • Edmonton: 16143 142 St NW
  • Winnipeg: 1800-201 Portage Ave.
  • Fax Number: 647 945 8872
  • Email: info@incorporationpro.ca
Our Phone Numbers
  • Ontario: 647 945 8873 (8am-8pm EST)
  • Québec: 438 558 2300 (8am-8pm EST)
  • BC: 604 283 2027 (5am-5pm PST)
  • Alberta: 780 851 2820 (6am-6pm MST)
  • Manitoba: 204 202 7866 (7am-7pm CST)
  • All Other: 1 888 675 1412 (8am-8pm EST)
Our Policies

DISCLAIMER
TERMS & CONDITIONS

  • About Us
  • Why Us?
  • FAQs
  • Career
  • Order Tracking

COPYRIGHT 2022 © Incorp Pro. All rights reserved.