Generate your own legal
Shareholders Agreement
document online now and run your company properly.


2
5 Minutes to complete      Pay R599 online      Customised legal document emailed to you.

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Frequently Asked Questions

What are Authorised Shares?

Every Company needs to initially make a number of Shares available to the current and future Shareholders, these are called Authorised Shares.  The maximum amount of Authorised Shares is normally 1000.

What are Issued Shares?

Issued shares is a term that refers to the number of Authorised Shares of a corporation which have been allocated and are subsequently held by Shareholders.  You will need to record the number of Issued Shares when completing our Online Interview.

What Shareholders' Information do I need for this Shareholders Agreement?

You will need to enter the details of all the Shareholders in the Company when completing our Online Interview.  We will need the following information:

  • Full Name (Required)
  • Number of Shares (Required)
  • Identity Number (can be added later)
  • Physical Address (can be added later)

What are Pre-emptive Rights?

A Pre-emptive Right is a privilege for existing Shareholders of a Company that grants them the right to purchase the Shares in the company that another Shareholder wants to sell before those particular shares are made available for purchase to third parties (people outside the company).  It is like a Right of First Refusal for existing Shareholders.  Pre-emptive rights provide certainly to existing Shareholders.

iLawyer’s Shareholders Agreement includes Pre-emptive Rights and sets out the procedure to be followed if a Shareholder wishes to sell the whole or a part of their Shares.

What is a "Buy and Sell" clause / agreement?

A Buy and Sell Agreement is used to reallocate shares of a company if the owner of those Shares dies.

If a Shareholder dies, the remaining Shareholders are REQUIRED to buy the Shares from the deceased Shareholder’s Estate.

The intention is for the remaining Shareholder(s) to buy the Deceased Shareholder’s Shares from the deceased Shareholder’s Estate at a “fair market price” and for the Heirs of the Deceased Shareholder to receive the proceeds of the sale of Shares.

It is recommended that the Shareholders obtain and maintain a LIFE INSURANCE POLICY that will cover the value of the shares of the Company. The policy will be triggered if a Shareholder dies; the policy should payout proportionality to the deceased Shareholder’s Shareholding.

What is a "Come Along" clause?

A “Come Along” clause provides that if the majority Shareholder(s) of the Company sells their Shares, and the third party buying the shares wishes to acquire the remaining Shares in the Company, the minority Shareholder(s) are forced to join the deal.  The minority Shareholder(s) will receive the same deal as the majority.

Who is a "Tag Alone" clause?

A “Tag Along” clause provides that if the majority Shareholder(s) of the Company sells their Shares, the remaining minority Shareholder(s) have the right to join the deal and to sell their Shares at the same terms and conditions as the majority Shareholder(s), and the new owner MUST purchase those interests as well.

This right protects minority Shareholder(s) from being potentially forced to sell their shares for less than the majority Shareholder(s) (as, after the deal, they likely would have no ability to outvote the new owner(s) who would have majority control).

Can I transfer my Shares to a Trust?

iLawyer’s Shareholders Agreement allows you to add a clause that permits the Shareholders of the Company to transfer their Shares to a Trust provided that the transferring Shareholder is a Trustee in the Trust.

 

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