Document background
The Private Company Shareholder Agreement is a fundamental document for privately held companies in Canada, typically implemented either at company formation or when new shareholders join an existing corporation. It serves as a binding contract between shareholders, establishing their rights, responsibilities, and relationships while ensuring compliance with Canadian federal or provincial corporate law. This agreement is essential for preventing and resolving potential conflicts, protecting minority shareholder rights, establishing share transfer mechanisms, and defining corporate governance structures. It should be customized to address specific company needs while maintaining consistency with relevant jurisdiction requirements, whether under the Canada Business Corporations Act or provincial legislation. The document becomes particularly important when companies have multiple shareholders, family-owned businesses seeking formalization, or when implementing succession planning.
