B02551 – UNANIMOUS SHAREHOLDER JOINT VENTURE LONG BENCHMARKING KIT 2
B02551
unanimous shareholder agreement with joint venture partner long form benchmarking kit
B02551-1(CFPC/Corporate – 2007)
B02551 – UNANIMOUS SHAREHOLDER JOINT VENTURE LONG BENCHMARKING KIT 2
TABLE OF CONTENTS
PAGE
1INSTRUCTIONS......
2BENCHMARKING GRID......
3BENCHMARK AGREEMENT......
1INSTRUCTIONS
If this is your first attempt at using one of our benchmarking grids we recommend that you consult document no. A00001 for instructions you on how best to use this tool. You will find this document in volume I at pages A00001 to A00001-7 of this collection.
2BENCHMARKING GRID
BENCHMARK AGREEMENT: B02550 / MATCHING PROVISION(S) / VARIATIONS/OBSERVATIONS
IDENTIFICATION AND COORDINATES:
IDENTIFICATION OF PARTIES:
SHAREHOLDERS
CORPORATION
RECITALS
A)Description of the holding
B)Creation of the convention
C)Main intent
D)Secondary intent
E)Liberal construction
F)Terms of the agreement
BENCHMARK AGREEMENT: B02550 / MATCHING PROVISION(S) / VARIATIONS/
OBSERVATIONS
1INTERPRETATION
1.1Definitions
(a)Activities
(b)Agreement
(c)Annual budget
(d)Articles
(e)Book value
(f)By-laws
(g)Change in control
(h)Confidential information
(i)Control
(j)Death
(k)Directors
(l)Disability
(m)Encumber or
encumbrance
(n)Fair market value
(o)Force majeure
(p)Group
(q)Governing statute
(r)Initial public offering
(s)Intellectual property
(t)Legal representatives
(u)Liquidation event
(v)Liquidity committee
(w)Ordinary course of
business
(x)Person
(y)Prime rate
(z)Related person
(aa)Securities
(bb)Share
(cc)Shareholder
(dd)Shareholder-employee
(ee)Subsidiary
(ff)Territory
(gg)Trust
1.2Precedence
(a)Entire agreement
(b)Unanimous shareholder
agreement
1.3Jurisdiction
(a)Governing law
(b)Non-compliance
(i)Severability
(ii)Substitute provision
1.4Miscellaneous
(a)Cumulative rights
(b)Time and dates
(i)Time of the essence
(ii)Computation of time
(iii)Delays
(c)Financial references
(d)References within
agreement
(e)Gender and number
(f)Headings
(g)Presumptions
(h)Knowledge
(i)Approval
(j)GAAP
2PURPOSE
3GOVERNANCE OF THE
CORPORATION
3.1Board of directors
(a)Composition and Quorum
(i)Allocation of seats
(ii)Quorum
(b)Meetings
(i)Frequency
(ii)Notification
(iii)Emergency
(c)Replacement
(d)Proportional
representation
(e)Qualifications
(f)Conflict of interest
(g)Deemed resignation
(h)Liability insurance
3.2Management
(a)Appointment
(b)Eligibility
(i)Shareholders
(ii)Representative of investing
shareholder
(c)Deemed resignation
(i)Shareholders
(ii)Representative of investing
shareholder
3.3Banking
3.4New issue of shares
(a)Pre-emptive right
(i)Notice
(ii)Right to purchase
(iii)Exercise
(iv)Failure to exercise
(v)Assignment by investing
shareholder
(b)Allocation
(i)First allocation
(ii)Second allocation
(iii)Allocation to third parties
(iv)Confirmation
(c)Payment
(d)Exceptions
(e)Expiration
3.5Shareholder information
(a)Disclosure
(b)Access to books and
records
3.6Ratification by shareholders
(a)Unanimous vote
(b)Special majority
3.7Consent by the corporation
3.8Access
4RULES GOVERNING
SHAREHOLDERS
4.1Time contribution
(a)General contribution
(b)Employment agreement
(c)Disability
(i)Continuity of salary
(ii)Date of disability
4.2Financial contribution
(a)Cash calls
(i)Pro rata basis
(ii)Default
(iii)Adjustment and special terms
(A)New issue
(B)Loan to defaulting shareholder
(C)Loan to corporation
(b)Endorsement an personal security
(i)Pro rata basis
(ii)Indemnification
(c)Withdrawal of certain
contributions
(i)Redemption/repayment
(ii)Shareholders’ responsibility
(iii)Insurance proceeds
4.3Profit-sharing
4.4Expenses
4.5Exercise of voting rights
4.6New issue of shares
4.7Business opportunities
4.8Confidential information
(a)Undertaking
(b)Duty to disclose
(c)Exception
4.9Non-competition
(a)Scope
(b)Competing Business
(c)Duration
(d)Penalty
(e)Other remedies
(f)Application
(g)Effect of breach on sale price
(h)Exceptions
(i)Subrogation
(j)Assignment of rights
(k)Representation
4.10Non-solicitation of customers
(a)Undertakings
(b)Penalty
4.11Non-solicitation of staff
(a)Undertaking
(b)Penalty
4.12Cumulative obligations
4.13Intellectual property
4.14No controlling position
(a)Agreement
(b)Sanction
4.15Assignment of shares
4.16Indemnification
(a)“Loss”
(b)Scope
5MUTUAL REPRESENTATIONS
AND WARRANTIES
5.1Status
5.2Authority
5.3Binding agreement
5.4Canadian resident
5.5Canadian status
5.6Nominee
5.7Fundamental provisions
5.8Disclosure
6WITHDRAWAL OF A
SHAREHOLDER
6.1Voluntary withdrawal
6.2Expulsion
(a)Triggering events
(i)Founding shareholders
(ii)Shareholder-employee
(c)Purchase price
(d)Formalities
(e)Resignation
6.3Put option
(a)Application
(i)Request for purchase
(ii)Purchase
(b)Terms of payment
(i)Initial payment
(ii)Balance of price
(iii)Interest
(iv)Due date
(v)Pre-payment
(vi)Acceleration of payment
(vii)Restrictions on use of
corporate funds
(viii)Reimbursement and
discharge
(ix)Promissory note
(x)Fees and disbursements
(xi)Joint liability
(c)Failure to purchase
(i)Interest
(ii)Control
(d)Sale or liquidation
(i)Application
(ii)Liquidity committee
(iii)Cooperation of the
shareholders
(iv)Power of attorney
(v)Waiver
6.4Terms and conditions applicable to
any sale
(a)Application of the
agreement
(b)Release, discharge and
indemnification
(c)Resale or re-issuance of shares
(i)Remittance of profit
(ii)Notification by corporation
(iii)Conditional registration
(d)Application of sale provisions
(e)Obligations of selling shareholder
(f)Deliveries to selling
shareholder
(g)Repayment of
indebtedness
(h)Payment of purchase price
6.5Pre-authorized transfers
(a)Assignee
(i)Personal holding
corporation
(ii)Trust
(b)Condition precedent
(c)Assignor’s status
6.6Acquisition of shares by the
corporation
7TAKE-OVER PROPOSAL
7.1Terms and conditions
(a)Undertaking
(b)Required content
7.2Procedure
(a)Application
(b)Notice of acceptance and
disclosure of the offer
(c)Reply
(d)Deemed acceptance
(e)Sale to authorized
purchaser
(f)Amendment of offer
8DEATH OF A SHAREHOLDER
8.1Notice of death
8.2Choice of investing shareholder
9FINANCING
9.1Life insurance
(a)Policy
(b)Additional terms of policy
9.2Balance
9.3Consent of shareholders
9.4Duties and obligations of the
corporation
(a)Prohibition
(b)Additional protection
(i)Undertaking
(ii)Presumption
(c)Death of a shareholder
(i)Collection
(ii)Annulment of policy
9.5Transfer of policies
(a)Change of owner/
beneficiary
(b)Inter vivos sale
(c)Termination of the
agreement
9.6Disclosure
9.7Excess coverage
9.8Election
10VALUATION OF SHARES
10.1General rule
(i)Voluntary sale
(ii)Expulsion
(iii)Sale upon death
10.2Justification of separate values
10.3Determination of the initial value
10.4Determination of the current value
(a)Reassessment by the
shareholders
(b)Dissent
10.5Alternative value determination
(a)Application
(b)Evaluator
(i)Auditor
(ii)Time limit
(c)Arbitration
(i)Request of shareholder
(ii)Time limit
(iii)Costs
10.6Prohibition
10.7Administrative reassessment
(i)Responsibility of
purchasing shareholders
(ii)Options
11ESCROW AGENT
12SPECIAL PROVISIONS
12.1 Assignment
(a)Prohibition
(b)Effect of breach
(c)Exception
12.2Suspension of rights
12.3Force majeure
(a)No default
(b)Duty
13GENERAL PROVISIONS
13.1Notices
13.2Dispute resolution
(a)Mediation
(i)Undertaking
(ii)Confidentiality
(iii)Failure
(b)Arbitration
(i)Jurisdiction
(ii)Notification
(iii)Response
(iv)Nomination of third arbiter
(v)Hearing
(vi)Decision
(vii)Rules
(viii)Powers
13.3Choice of venue
13.4Counterparts
13.5Amendment
13.6Waiver of rights
13.7Electronic transmission
14TERMINATION
14.1End of existence
14.2Winding-up
(a)Appointment of a
liquidator
(b)Duties of the liquidator
(c)Settlement of accounts
(d)Compensation of the
liquidator
15EFFECTIVE DATE
16DURATION
16.1Initial and extended term
16.2Continued effect
17SCOPE
SCHEDULES
«A» EXCERPT OF A
RESOLUTION BY A
CORPORATE
SHAREHOLDER
«B» EXCERPT OF A
RESOLUTION OF THE
CORPORATION
1.1(l)DISABILITY INSURANCE
POLICY
1.1(cc)INTERVENTION BY AN
INTERESTED THIRD
PARTY
3.1(h)DIRECTORS AND
OFFICERS INSURANCE
4.3SALARIES AND BENEFITS
10.1(A)VALUE OF THE CLASS “…”
SHARES
10.1(B)VALUE UPON DEATH OF A
SHAREHOLDER OF THE
CLASS “…” SHARES
LIST OF DEFICIENCIES
1.Unauthorized signing party13.Lack of consent2.Incapable signing party14.Ambivalent wording
3.Conflict with principal agreement15.Wrong party
4.Conflict with subordinate agreement16.Wrong coordinates
5.Conflict with other article17.Wrong date
6.Non compliance with appropriate law 18.Typo
7.Non compliance with statute19.Spelling Error
8.Incomprehensible clause20.Poor construction of sentence
9.Incomplete clause21.Wrong reference to schedule
10.Impossible to perform obligation22.Wrong reference to article
11.Undertaking subject to impossible condition23.Inversion
12.Undertaking subject to discretionary condition24.Unratified modification of text (no initials)
3BENCHMARK AGREEMENT
The benchmark agreement referred to in the benchmarking grid is located in volume I at pages B02550-1 to B02550-75 of this collection. We recommend that you attach a copy of the benchmark agreement to simplify your workflow when executing your review.
B02551-1(CFPC/Corporate – 2008-1)