Glossary · People and paperwork
Shareholder Agreements
In short
A contract among shareholders of a corporation that governs their relationship, rights, and responsibilities, often including restrictions on share transfers. Buyers need to understand who controls the company and any limitations on future sales.
What it means in a deal
These agreements are crucial in a stock purchase, outlining voting rights, buy-sell provisions, and often non-compete clauses for selling shareholders. Scrutinize these for any clauses that could impact your control or future exit. Make sure all selling shareholders are party to the agreement or that it is properly terminated.
Related terms
Common questions about Shareholder Agreements
- What specific conditions trigger affiliation due to contractual relationships or franchise agreements?
- What are the key distinctions between cross-purchase and entity-purchase buy-sell agreements?
- How does the SBA review franchise agreements for compliance if there are unusual clauses regarding termination or transfer?
- How does the SBA determine if a franchisor has "control" over a franchisee for affiliation purposes, beyond standard agreements?
Defined by CapBench SBA Intelligence — plain-English definitions for business buyers, lenders, advisors, and AI agents, grounded in public SBA rules and records. Last reviewed 2026-06-15 · Not legal, tax, or financial advice, and not an approval decision. Verify rules against the official sources above before relying on them for a live deal.
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