Alberta Unanimous Shareholder Agreement

Use this Subscription Agreement to issue warrant shares to investors under a Warrant Indenture in the Province of Alberta.

• No offering memorandum or prospectus is being filed in connection with the offering.
• The subscription agreement and payment for the shares is to be tendered by the investor to the offering corporation, in return for the shares.
• The exercise price and the number and kind of securities will be adjusted accordingly, in the event of a subdivision, consolidation, or reclassification of the corporation's shares, or an amalgamation or merger with another corporate entity.
• The subscriber warrants that it will at all relevant times deal with the corporation at arm's length for purposes of the Income Tax Act (Canada).
• The subscriber agrees to abide by the terms of any shareholder agreement already in place.
• This Subscription Agreement is intended for use in the Province of Alberta, Canada. It is available in MS Word format.

Discover the legal and practical issues you need to consider when entering into a shareholder agreement with this Shareholder Agreement Guide and Checklist for Canadian companies.

• Topics in the Guide include:
  • how to avoid misunderstandings between shareholders;
  • distribution of profits;
  • decision-making;
  • exit strategies;
  • employee shareholders;
  • default by a shareholder;
  • disability or death;
  • loss of shareholder control.
• Available as a PDF download.
• This checklist was created for use in Canada.

Review the issues you need to consider when drafting a shareholder agreement for a Canadian corporation with this Unanimous Shareholder Agreement Checklist.

• Topics include:
  • composition of the board of directors,
  • removal of a director or officer,
  • conflict of interest,
  • reservation of directors' powers to shareholders,
  • shareholder meetings,
  • conduct of business,
  • restrictions on share transfers,
  • buy-sell on the death of a shareholder,
  • miscellaneous matters.
• This form is available in MS Word format and is easy to download, edit and print.
• Intended to be used only in Canada.

Prepare a Unanimous Shareholder Agreement for a Canadian corporation with this fully editable template.

• Under this Agreement, one of the shareholders gives the corporation the right to operate a business as a distributor of certain licensed products, and grants the corporation a license to use its trade marks and other proprietary marks in connection with those products.
• Other provisions of the Agreement include:
  • restrictions on the sale and transfer of shares,
  • business of the corporation to be conducted by the directors,
  • shareholder loans to be repaid on a proportional basis,
  • annual valuation of shares, based on the net book value of the company's tangible assets,
  • shares of a deceased shareholder to be repurchased for cancellation by the company,
  • departing shareholders have a put option,
  • non-competition provisions,
  • buy-sell provisions for selling the interest of a departing shareholder.
• Available in MS Word format.
• Governed by Canadian laws and intended to be used only in Canada.

Should your company shareholder agreement include a shotgun clause? This article discusses these types of provisions from an owner-manager's perspective.

What is a "shotgun clause"?

A 'shotgun clause' or 'buy-sell clause' is a clause in a shareholder agreement which provides that if a shareholder wants to pull their investment out of the company, they can force the other shareholders to buy their shares.

Benefits and risks of a shotgun provision

The selling shareholder sets the price and the terms of sale, and the remaining shareholder(s) decide whether to accept the sale on that basis. In theory, a shotgun clause provides a fair mechanism for shareholder departure, due to the fact that the seller does not know whether or not the price and terms will be accepted. Therefore they must be reasonable in setting the price and terms.

In practice, however, a selling shareholder often tries to use the shotgun clause to their advantage, which can result in the receiving shareholder(s) turning to arbitration or the courts to settle the matter.

Practical limitations of shotgun clauses

The article discusses the limitations on shotgun clauses, and how to use them properly in your shareholder agreement.

Alternative methods of shareholder breakups

The writer discusses other methods of no-fault corporate divorce that can be used instead of a shotgun provision, such as drag-along, tag-along clauses, right of first refusal options, and auction or bidding processes.

Author Credit

This article was written by Phil Thompson, business lawyer and corporate counsel in Ontario, Canada.

Learn about the types of events which trigger a sale of shares under a Unanimous Shareholder Agreement, and the methods used to implement the sale.

• Triggering events include:
  • right of first refusal;
  • default buy-sell;
  • shotgun or forced sale;
  • transfer on death.
• Available as a PDF download.