Shareholders Agreement Template Word Nz

SHAREHOLDERS AGREEMENT

1. DOCUMENT PREAMBLE & RECITALS

THIS SHAREHOLDERS AGREEMENT (the "Agreement") is entered into and made effective as of this [Day] day of [Month], [Year] (the "Effective Date"), by and among:

1. [Company Name], a company incorporated under the laws of New Zealand having its registered office at [Registered Office Address] (hereinafter referred to as the "Company");
2. [Shareholder 1 Legal Name], residing at [Shareholder 1 Residential Address] (hereinafter referred to as "Shareholder 1"); and
3. [Shareholder 2 Legal Name], residing at [Shareholder 2 Residential Address] (hereinafter referred to as "Shareholder 2").

(Shareholder 1 and Shareholder 2 are hereinafter collectively referred to as the "Shareholders" and individually as a "Shareholder").

RECITALS

A. The Company was incorporated in New Zealand on [Incorporation Date] under the Companies Act 1993 with a total number of [Total Number of Authorized Shares] authorized shares, of which [Number of Issued Shares] ordinary shares are currently issued and outstanding.

B. The Shareholders are the legal and beneficial owners of the issued ordinary shares of the Company in the respective proportions set forth in Schedule A attached hereto.

C. The Parties desire to enter into this Agreement to govern their respective rights, duties, and obligations as shareholders, to provide for the sound management and operation of the Company, and to establish mechanisms for the transfer of shares and the resolution of disputes in accordance with New Zealand law.

NOW, THEREFORE, in consideration of the mutual covenants, promises, and conditions contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties covenant and agree as follows:

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2. OPERATIONAL DEFINITIONS

For the purposes of this Agreement, except as otherwise expressly provided or unless the context otherwise requires, the following terms shall have the meanings ascribed to them below:

1. "Act" means the Companies Act 1993 (NZ), as amended from time to time.
2. "Board" means the board of directors of the Company constituted from time to time in accordance with this Agreement and the Act.
3. "Business Day" means a day (other than a Saturday, Sunday, or public holiday) on which registered banks are open for general banking business in [City, e.g., Auckland], New Zealand.
4. "Fair Market Value" means the fair market value of the Shares as determined jointly in writing by the Shareholders, or, in the absence of such agreement within [Number] Business Days, as determined by an independent chartered accountant appointed jointly by the disputing parties or, failing agreement on such appointment, by the President for the time being of the New Zealand Institute of Chartered Accountants.
5. "Good Leaver" means a Shareholder who ceases to be an employee, director, or shareholder of the Company by reason of death, permanent disability, retirement at or after normal retirement age, or dismissal by the Company without cause.
6. "Bad Leaver" means a Shareholder who ceases to be an employee, director, or shareholder of the Company by reason of summary dismissal for cause, material breach of this Agreement, fraud, dishonesty, or voluntary resignation without the written consent of the Board prior to [Date/Milestone].
7. "Majority Shareholders" means Shareholders holding at least [Percentage, e.g., 75] percent of the voting rights attached to the issued shares of the Company.
8. "Offer Notice" means a written notice given by a transferring Shareholder offering to sell their Shares to the remaining Shareholders pursuant to Clause 3.
9. "Shares" means all classes of shares in the capital of the Company issued to and held by the Shareholders from time to time.
10. "Transfer" means any sale, assignment, pledge, encumbrance, gift, bequest, alienation, or other disposition of any Shares, whether voluntarily, involuntarily, by operation of law, or otherwise.

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3. SUBSTANTIVE TERMS & OBLIGATIONS

3.1 Governance and Board Composition

1. The Board shall consist of up to [Number] directors. Each Shareholder holding not less than [Percentage] percent of the Shares shall have the right to nominate one (1) director to the Board by written notice to the Company.
2. Quorum for meetings of the Board shall require at least [Number] directors present in person or via approved telecommunication links, representing the distinct nomination rights of the Shareholders.

3.2 Capital Contributions and Funding

1. The Shareholders shall contribute capital to the Company in proportion to their respective shareholdings as set out in Schedule A, totaling [Dollar Amount] New Zealand Dollars (NZD), payable on or before the Effective Date.
2. If the Company requires additional working capital, the Board may call upon the Shareholders to provide shareholder advances or subscribe for further Shares in proportion to their existing shareholdings. No Shareholder shall be mandated to provide personal guarantees for third-party debt without unanimous written consent.

3.3 Restrictions on Transfer of Shares

1. General Prohibition: No Shareholder shall Transfer any Shares except in strict compliance with the Act, the Constitution of the Company, and the provisions of this Agreement. Any purported Transfer in violation hereof shall be null and void ab initio.
2. Right of First Refusal:
   • If a Shareholder (the "Transferor") wishes to Transfer any Shares, they shall first deliver an Offer Notice to the Company and the non-transferring Shareholders.
   • The Offer Notice shall state the number of Shares offered, the cash price per share, and the terms of the proposed Transfer.
   • The non-transferring Shareholders shall have the option, exercisable within [Number, e.g., 30] Business Days of receipt of the Offer Notice, to purchase all (but not less than all) of the offered Shares pro rata to their existing shareholdings.
3. Tag-Along Rights: If a Majority Shareholder proposes to Transfer a controlling interest ([Percentage, e.g., 50+ ] percent) to an independent third-party purchaser, the minority Shareholders shall have the absolute right to require the third-party purchaser to acquire their Shares on the same terms and conditions.
4. Drag-Along Rights: If Shareholders holding not less than [Percentage, e.g., 75] percent of the Shares (the "Selling Shareholders") accept a bona fide arm's-length offer from a third-party purchaser to acquire 100% of the Company, the Selling Shareholders may require all other Shareholders to Transfer all of their Shares to that third party on the same terms and conditions.

3.4 Representations and Warranties

Each Shareholder severally represents and warrants to each other Shareholder and to the Company that:

1. They have the full legal capacity, power, and authority to enter into and perform their obligations under this Agreement.
2. The execution and delivery of this Agreement do not violate any existing contracts, court orders, or statutory provisions binding upon them.
3. Their respective Shares are owned free and clear of any liens, encumbrances, security interests, or third-party claims.

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4. DEFAULT, TERMINATION, AND REMEDIES

4.1 Events of Default

An Event of Default shall occur if any Shareholder (the "Defaulting Shareholder"):

1. Commits a material breach of any term, covenant, or obligation contained in this Agreement or the Constitution of the Company and fails to remedy such breach within thirty (30) Business Days of receiving written notice from a non-defaulting Shareholder specifying the breach and demanding its remedy.
2. Becomes insolvent, enters into statutory management, is placed into liquidation (other than a voluntary solvent liquidation for reconstruction or amalgamation), or makes any assignment for the benefit of creditors.
3. Is classified as a Bad Leaver pursuant to the provisions of Clause 2.

4.2 Remedies Upon Default

Upon the occurrence of an Event of Default and the expiry of the applicable cure period:

1. The non-defaulting Shareholders may, by written notice to the Defaulting Shareholder, elect to purchase all of the Defaulting Shareholder’s Shares at a purchase price equal to [Percentage, e.g., 75] percent of the Fair Market Value (in the case of a Bad Leaver) or 100% of the Fair Market Value (in the case of a Good Leaver or general default).
2. The Defaulting Shareholder shall automatically forfeit all voting rights attached to their Shares and any right to receive dividends declared thereafter until the completion of the compulsory Transfer of their Shares under this Clause.
3. The non-defaulting Parties reserve all other legal and equitable remedies available under New Zealand law, including specific performance and claims for damages.

4.3 Termination

This Agreement shall terminate automatically upon the occurrence of any of the following events:

1. The formal winding up, liquidation, or dissolution of the Company.
2. The listing of the Company’s shares on a recognized stock exchange (IPO).
3. The written agreement of all surviving Shareholders to terminate this Agreement.

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5. BOILERPLATE LEGAL PROVISIONS

1. Severability: If any provision of this Agreement is held to be invalid, illegal, or unenforceable by a court of competent jurisdiction, such provision shall be severed to the minimum extent necessary, and the remaining provisions shall remain in full force and effect.
2. Entire Agreement: This Agreement, together with the Schedules hereto and the Constitution of the Company, constitutes the entire agreement and understanding between the Parties relating to the subject matter hereof and supersedes all prior oral or written negotiations, commitments, or agreements.
3. Force Majeure: No Party shall be liable for any failure to perform its obligations under this Agreement if such failure results from acts of God, war, civil unrest, pandemic, government restrictions, or any other cause beyond the reasonable control of the affected Party, provided that prompt written notice is given to all other Parties.
4. Governing Law and Jurisdiction: This Agreement shall be governed by, construed, and enforced in accordance with the substantive laws of New Zealand. The Parties irrevocably submit to the non-exclusive jurisdiction of the courts of New Zealand.
5. Dispute Resolution:
   • In the event of any dispute arising out of or relating to this Agreement, the disputing Parties shall first attempt in good faith to resolve the dispute through senior management negotiation or mediation.
   • If the dispute is not resolved within twenty (20) Business Days of commencement of discussions, the dispute shall be referred to and finally resolved by arbitration in [City, e.g., Wellington], New Zealand, under the arbitration rules of the Arbitrators' and Mediators' Institute of New Zealand (AMINZ).

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6. FORMAL EXECUTION BLOCK

IN WITNESS WHEREOF, the Parties hereto have executed this Shareholders Agreement by their duly authorized representatives as of the Effective Date written above.

THE COMPANY:

[Company Name]

[Signature of Authorized Signatory]
Name: [Signatory Name]
Title: [Signatory Title, e.g., Director]
Date: [Date]

Witness Signature: [Witness Signature]
Witness Name: [Witness Name]
Witness Address: [Witness Address]

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SHAREHOLDER 1:

[Shareholder 1 Legal Name]

[Signature of Shareholder 1]
Date: [Date]

Witness Signature: [Witness Signature]
Witness Name: [Witness Name]
Witness Address: [Witness Address]

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SHAREHOLDER 2:

[Shareholder 2 Legal Name]

[Signature of Shareholder 2]
Date: [Date]

Witness Signature: [Witness Signature]
Witness Name: [Witness Name]
Witness Address: [Witness Address]

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SCHEDULE A: SHAREHOLDING STRUCTURE