Corporate Shareholder Agreement

Corporate Shareholder Agreement

This Corporate Shareholder Agreement (the "Agreement") is made and entered into as of by and between Corporation Name: , a corporation organized under the laws of , with its principal office at (the "Corporation"), and Shareholder Name: , residing or having an address at (the "Shareholder"). The Corporation and the Shareholder are each a "Party" and collectively the "Parties."

Recitals

WHEREAS, the Corporation is duly organized and authorized to issue shares of its capital stock and the Shareholder is the record and beneficial owner of certain issued shares as set forth on the Corporation's register; and

WHEREAS, the Parties desire to set forth their respective rights and obligations with respect to ownership, transfer, governance, and management of the Corporation, and to provide for certain restrictions on transfer and procedures for the resolution of disputes among shareholders; and

WHEREAS, the Parties deem it advisable and in their best interests to reduce such understanding into this written Agreement.

NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

1. Definitions

For purposes of this Agreement, the following terms shall have the meanings set forth below:

"Shares" means all issued and outstanding shares of capital stock of the Corporation held by the Shareholder as of the Effective Date and thereafter acquired unless otherwise specified.

"Affiliate" means, with respect to any Person, any other Person directly or indirectly controlling, controlled by, or under common control with such Person.

2. Share Ownership; Registration

2.1 Share Register. The Corporation shall maintain a register of Shareholders and shall record the name and address of the Shareholder and the number and class of Shares held by the Shareholder. Shareholder agrees to furnish to the Corporation all information reasonably requested to maintain accurate records.

2.2 Transfer Restrictions. Except as provided in this Agreement, the Shareholder shall not sell, assign, pledge, encumber, or otherwise transfer any Shares without complying with the preemptive and consent procedures set forth in Section 4. Any purported transfer in violation of this Section shall be null and void and of no force or effect.

3. Representations and Warranties

3.1 By the Corporation. The Corporation represents and warrants that (a) it is duly organized and validly existing under the laws of the state of incorporation identified above; (b) it has the corporate power and authority to execute and deliver this Agreement and to perform its obligations; and (c) the execution, delivery and performance of this Agreement by the Corporation has been duly authorized by all necessary corporate action.

3.2 By the Shareholder. The Shareholder represents and warrants that (a) the Shareholder has good and marketable title to the Shares free and clear of any lien, encumbrance or restriction except as set forth in this Agreement; (b) this Agreement constitutes a valid and binding obligation of the Shareholder enforceable in accordance with its terms; and (c) the Shareholder has full power and authority to enter into and perform this Agreement.

4. Right of First Refusal and Preemptive Rights

4.1 Right of First Refusal. If the Shareholder receives a bona fide offer from a third party to purchase any Shares and the Shareholder desires to accept such offer, the Shareholder shall give written notice to the Corporation specifying the terms of the proposed sale. The Corporation shall have the right, for a period of thirty (30) days following receipt of such notice, to purchase the offered Shares on the same terms and conditions.

4.2 Preemptive Rights. In the event the Corporation proposes to issue additional shares of the same class as the Shares, the Shareholder shall have the option to subscribe for such new issuance in proportion to the Shareholder's percentage ownership, subject to such reasonable procedures and timelines as the Board of Directors may establish.

5. Tag-Along and Drag-Along Rights

5.1 Tag-Along. If one or more shareholders propose to transfer a controlling interest in the Corporation to a third party, the Shareholder shall have the right to include all or a proportionate part of the Shareholder's Shares in such sale on the same terms and conditions.

5.2 Drag-Along. If holders of a majority of the outstanding voting shares (the "Selling Majority") approve a sale or merger that would transfer control of the Corporation, the Selling Majority may require the Shareholder to sell a proportionate number of Shares on the same terms and conditions as approved by the Selling Majority, provided that such sale is fair and commercially reasonable.

6. Governance and Voting

6.1 Board Composition. The Shareholder shall be entitled to nominate and vote for directors in accordance with the Shareholder's percentage ownership and any separate agreement of the Parties. The Corporation shall cause the Board of Directors to consider such nominations in good faith.

6.2 Reserved Matters. Notwithstanding any other provision, the following actions shall require the approval of the holders of at least a specified majority of the voting power: (a) amendment of the certificate of incorporation or bylaws that adversely affects Shareholder rights; (b) issuance of additional classes of stock junior to or on parity with the Shares; (c) sale, lease or other disposition of all or substantially all of the Corporation's assets; and (d) authorization of indebtedness in excess of an agreed threshold.

7. Dividends and Distributions

Dividends shall be declared and paid at the discretion of the Board of Directors, subject to compliance with applicable law and the Corporation's governing documents. The Corporation shall not declare or pay dividends if such action would violate statutory capital maintenance rules or materially impair the Corporation's ability to meet obligations as they mature.

8. Confidentiality

Each Party shall keep confidential and shall not disclose to any third party any non-public information received from the other Party concerning the business, finances, plans, or operations of the other Party, except as required by law or as necessary to enforce rights under this Agreement. Confidential information shall remain subject to this obligation for a period of five (5) years after disclosure or for such longer period as required by law.

9. Indemnification

Each Party shall indemnify, defend and hold harmless the other Party and its officers, directors and agents against any and all losses, liabilities, claims, damages, and expenses (including reasonable attorneys' fees) arising out of any breach by the indemnifying Party of any representation, warranty or covenant contained in this Agreement, except to the extent such losses arise from the gross negligence or willful misconduct of the indemnified Party.

10. Term; Termination

This Agreement shall commence on the Effective Date and shall continue in effect until terminated by written agreement of the Parties or upon dissolution of the Corporation. Termination shall not relieve any Party of liability for obligations accrued prior to termination or for provisions that by their nature survive termination.

11. Notices

All notices, demands or other communications required or permitted hereunder shall be in writing and shall be deemed to have been duly given when delivered personally, sent by nationally recognized overnight courier, or mailed by certified mail, return receipt requested, to the addresses set forth below (or to such other address as a Party may designate by notice to the other Party).

12. Amendments, Waiver and Counterparts

No amendment, modification, or waiver of any provision of this Agreement shall be effective unless set forth in a written instrument signed by the Parties. No waiver shall constitute a continuing waiver unless expressly stated. This Agreement may be executed in counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same instrument.

13. Governing Law; Venue

This Agreement shall be governed by and construed in accordance with the laws of the state specified below without regard to principles of conflicts of law. The Parties submit to the exclusive jurisdiction of the state and federal courts located in the specified jurisdiction for any dispute arising out of or relating to this Agreement.

14. Entire Agreement; Severability

This Agreement constitutes the entire agreement and understanding between the Parties with respect to the subject matter hereof and supersedes all prior and contemporaneous agreements, understandings, negotiations and discussions, whether oral or written. If any provision of this Agreement is held to be invalid, illegal or unenforceable, the remaining provisions shall remain in full force and effect and shall be interpreted so as to effectuate the original intent of the Parties to the fullest extent permitted by law.

15. Miscellaneous

15.1 Assignment. Neither Party may assign its rights or delegate its obligations under this Agreement without the prior written consent of the other Party, except that the Corporation may assign to an Affiliate in connection with a merger, consolidation or sale of substantially all of its assets.

15.2 Remedies. The Parties acknowledge that monetary damages may be inadequate to remedy a breach of this Agreement and that the non-breaching Party shall be entitled to seek injunctive relief and other equitable remedies in addition to any other remedies available at law or in equity.

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