A shareholders` agreement is different from a corporate incorporation, although the two documents have many things in common. Under the Corporations Act 2001, a company incorporation is mandatory, while a shareholders` agreement is not. However, a shareholders` agreement is a valuable document that can help define the different rights and obligations of shareholders and clarify many details about how the company will operate. A shareholders` agreement is a contract between certain or all shareholders of a company. In many cases, the company is also a party to the agreement. Given the diversity of forms that companies can take, shareholder agreements can also vary considerably. Some of the details that may be included in this document are as follows: The Corporations Act 2001 (Commonwealth) governs the operation of businesses in Australia. Once the agreement is prepared, each party can obtain a copy of the agreement so that they can read it. If each party agrees with the agreement, it can sign it and have its signatures attested by an independent adult person.
A guide that helps you: How to choose the best legal structure for your business Each party can keep a copy of the agreement for their own recordings. In order to ensure that this shareholders` agreement is compatible with the incorporation of the company, it is good to review the constitution of the company before the conclusion of this agreement. Many parts of this agreement deal with information that is also dealt with in the company`s constitution. If they are not carefully examined, there may be conflicts or contradictions between the two documents….