Shareholder Agreement Hk

We focus our questions and comments on the goal of creating a relevant document that offers a structured approach to the life – and crisis – of the company until the next turning point/shareholders` agreement. Trading partners often share common and/or complementary competences, which justifies their cooperation at the outset. But what if such partners want to share or develop parallel activities? Shareholder agreements may include non-competition and non-debauchery clauses that set out in advance the limits within which shareholders may engage in competitive activities. Unless special provisions prevent it, majority shareholders can generally decide (legally) to dilute minority shareholders by issuing additional shares of the company. Dilution protection rights reduce the effectiveness of such a “scheme” by requiring the company to first offer existing shareholders all newly issued shares in relation to their existing shares. In exchange, we explain and discuss the usual clauses and their many variants (for tailor-made shareholder agreements) or what our proposed option is for the situation of your company. In this sense, it is important for a lawyer to establish a written agreement covering areas such as indemnification, exit clauses, roles and responsibilities. » Investor protection: Investors take a risk for their investment, as they may not recover the funds they have invested in the company and therefore often require shareholders to agree on certain provisions to protect their position. For example, they may require that the company`s performance objectives be met within a set period of time and, if those objectives are not met, the investor has the option of demanding certain measures or having the opportunity to take control of the business. These provisions are often found in a shareholders` agreement.

In the case of simplified shareholder agreements, our usual processing time for the first project is 5 working days from the first working meeting or if all the requested information has been provided. It is likely that a shareholders` agreement with different categories of members and intensive negotiations on the rights and obligations of each will take a few more days. Shareholder agreements are not necessarily intended to regulate all day-to-day operations of the underlying business, but rather govern the relationship between shareholders with respect to certain key issues. In this regard, when new shareholders come together to launch or continue a project, it is important to discuss and understand both the expectations of the other parties and the underlying company, to ensure that they are “on the same side”. As such, shareholder agreements may be complete or limited depending on the nature of the relationship between shareholders, the nature of the activity concerned and the participation structure of the company concerned. Typical provisions contained in shareholders` agreements are as follows: shareholders` contracts supplement a company`s articles of association. . .

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