Often, clients ask about how to create an agreement template. They have questions how to create the agreement or whether it’s a good idea to create or not, are some doubts that they usually have. These templates are used very commonly as a legal/formal document as a written proof of a start-up between companies or business and its founders/owners. This is created for the safety for both the parties, incase, some issues come up later.
The shareholders agreement template is also called founder documents because shareholders of the company are also technically the founders of the company. Hence, it is also named that.
How to select the best?
- Coverage of all the issues- Information about company rules must be added in such templates, no matter how long it becomes. Points about management and control should be covered in details. If they fall short, there will be a compromise in the quality. You can either create a separate page to summarize the points and then continue with a detailed one, or simply use words that make the shareholders understand easily.
- Usage of plain and simple English- The use of words that are hard to understand and legal jargons must be avoided. Nowadays, usage of such language can lead to a downfall in the quality of such documents. Simple words which are easy to edit is preferable. Correlation between the paragraphs should be maintained.
- Price- Price gives a good idea about the quality. A free template may not be properly written. They are generally of bad quality. Price shows the knowledge of the person who creates the document. There is cost involved in creating a good shareholder agreement document.Maintaining it is another story. Free templates need credit card and personal information. By drawing your own agreement, with or without a lawyer/solicitor, you are already saving money. The horror of creating your own agreement leads to using free templates which always have poor quality.
- Author- The academic qualification of the author and his whereabouts should be known. This might seem ignorable, but knowing about the author of the document is crucial information. A lot of problems regarding the selling of documents happen.
- Last update- You have to be sure about the updates of the agreement. There may be times when new laws are created or amendment in Company’s act has taken place. This usually happens every two years. Hence, while downloading a template, search for recent updates or addition of new laws.
- Technology- There are a couple of law tech companies that offer shareholder agreement templates. But technology isn’t of a proper quality. The reason being, shareholding documents are very personal to some. They don’t give the same quality as it gives in a customized self-edited document. The main issues may be covered by the software but it still lacks in it.
A shareholders template providers offer a last and final review service by using lawyers or using outsourced panel firms. Reviewing gives an assurance.