Good Leaver/Bad Leaver Shareholder Agreement - New Share Issue

This Basic Shareholder Agreement - New Share Issue with leaver provisions added is based on our basic shareholder agreement but has incorporated good leaver/bad leaver provisions within the body of the agreement.

Good leaver and bad leaver provisions for employee shareholders

The good leaver/bad leaver clause relates to any shareholder who is also an employee of the company and who subsequently leaves the company’s employment.

Whether the employee shareholder is obliged to offer his/her shares for sale to the other shareholders on departure will depend on the circumstances and whether he/she is classified as a good leaver or a bad leaver.

How the agreement defines good leavers and bad leavers

• A good leaver is defined as anyone who leaves the company’s employment through retirement, disability, redundancy or unfair dismissal.
• Good leavers have the option, but not the obligation, to sell their shares on departure.
• A bad leaver is defined in this agreement as anyone who is not considered to be a good leaver.
• A bad leaver is obliged to sell his shares on exit to the other shareholders.

The definitions can be altered as required to suit the circumstances that need to be achieved.

Standalone clause also available

Our good leaver/bad leaver clause can also be accessed here as a standalone document.

Other features of this agreement

• The agreement anticipates new shares being issued.
• A clause relating to restrictions on the shareholders (such as anti-solicitation and anti-competition) has been added.
• An optional anti-corruption clause has been added.

Good Leaver/Bad Leaver Shareholder Agreement - New Share Issue is part of Corporate. Just £38.50 + VAT provides unlimited downloads from Corporate for 1 year.