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Call Option Shareholders Agreement

Call Option Shareholders Agreement Generator for Australia

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Key Requirements PROMPT example:

Call Option Shareholders Agreement

"I need a Call Option Shareholders Agreement for our tech startup where a venture capital investor will have the option to purchase an additional 25% shareholding at a pre-agreed valuation, exercisable until March 2025, with standard anti-dilution and board appointment rights."

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Document background
A Call Option Shareholders Agreement is a crucial document in Australian corporate transactions and business planning. It is typically used when parties want to establish future share acquisition rights, whether for investment staging, succession planning, or strategic corporate arrangements. The agreement grants one or more parties (option holders) the right, but not the obligation, to purchase shares from existing shareholders at predetermined terms within a specified timeframe. This document is particularly valuable in scenarios involving staged investments, employee share schemes, business succession planning, or strategic partnerships. It must comply with Australian corporate law requirements, including the Corporations Act 2001 (Cth) and ASIC regulations, and typically includes detailed provisions on option terms, exercise mechanisms, completion procedures, and shareholder rights.
Suggested Sections

1. Parties: Identification of all parties to the agreement including the company, option grantor(s), and option holder(s)

2. Background: Context of the agreement, existing shareholding structure, and purpose of the call option arrangement

3. Definitions and Interpretation: Definitions of key terms and interpretation rules for the agreement

4. Grant of Call Option: Terms of the call option grant, including number of shares subject to option and any conditions precedent

5. Option Period: Duration of the option, including commencement and expiry dates

6. Exercise Price: Specification of the price at which the option can be exercised and payment terms

7. Exercise Procedure: Process and requirements for exercising the option, including notice requirements

8. Completion of Share Transfer: Procedures for completing the share transfer upon option exercise

9. Representations and Warranties: Standard warranties regarding share ownership, authority to grant option, and other relevant matters

10. Share Rights: Rights attached to the shares subject to the option during the option period

11. Confidentiality: Obligations regarding confidential information

12. Notices: Requirements for giving formal notices under the agreement

13. General Provisions: Standard boilerplate clauses including governing law, jurisdiction, and entire agreement

Optional Sections

1. Tag-Along Rights: Include when other shareholders should have the right to participate in any share sale resulting from option exercise

2. Drag-Along Rights: Include when option holder should have the right to force other shareholders to sell their shares upon option exercise

3. Security Interest: Include when the option or shares are subject to any security interests

4. Pre-emptive Rights: Include when existing shareholders should have first right of refusal on shares post-option exercise

5. Change of Control Provisions: Include when option exercise triggers or is affected by change of control events

6. Foreign Investment Conditions: Include when foreign investment approval is required for option exercise

7. Multiple Option Holders: Include when there are multiple option holders with specific rights and priorities

8. Anti-dilution Provisions: Include to protect option holder's rights in case of share capital reorganization

Suggested Schedules

1. Option Details: Detailed specification of shares subject to option, including class, number, and current ownership

2. Form of Option Exercise Notice: Template notice for exercising the option

3. Deed of Accession: Form of deed for option holder to become party to existing shareholders agreement upon exercise

4. Share Certificate Details: Copy or details of relevant share certificates

5. Existing Shareholders Agreement: Copy or key terms of any existing shareholders agreement affecting the optioned shares

6. Company Constitution: Copy of the company's constitution or relevant extracts

7. Calculation of Exercise Price: If applicable, methodology and formula for calculating the exercise price

8. Required Regulatory Approvals: List of required regulatory approvals and conditions for option exercise

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Linkedin in social icon imageX social icon image
alex.den.21@genieai.co
Relevant legal definitions
Agreed Value
ASIC
Business Day
Call Option
Call Option Fee
Completion
Completion Date
Corporations Act
Dispose
Encumbrance
Exercise Notice
Exercise Period
Exercise Price
Event of Default
Fair Market Value
Financial Year
Government Agency
GST
Insolvency Event
Material Adverse Change
Notice
Option Shares
Option Period
Permitted Encumbrance
Related Body Corporate
Related Party
Representative
Security Interest
Share
Share Capital
Shareholders Agreement
Subsidiary
Tax
Third Party Rights
Transfer
Valuation
Voting Rights
Working Day
Clauses
Interpretation
Definitions
Grant of Option
Option Period
Option Exercise
Exercise Price
Completion Requirements
Share Transfer
Representations and Warranties
Pre-emptive Rights
Tag-Along Rights
Drag-Along Rights
Share Rights
Voting Rights
Dividend Rights
Share Certificates
Board Composition
Management Rights
Information Rights
Confidentiality
Non-Competition
Anti-Dilution
Default
Termination
Assignment
Further Assurance
Costs
Notices
Governing Law
Dispute Resolution
Force Majeure
Severability
Entire Agreement
Amendment
Waiver
Third Party Rights
Relevant Industries

Financial Services

Private Equity

Venture Capital

Professional Services

Technology

Mining and Resources

Real Estate

Manufacturing

Healthcare

Retail

Agriculture

Family Business

Startups and Scale-ups

Relevant Teams

Legal

Corporate Finance

Mergers & Acquisitions

Investment

Compliance

Company Secretariat

Board of Directors

Executive Management

Corporate Development

Treasury

Relevant Roles

Chief Executive Officer

Chief Financial Officer

Chief Legal Officer

General Counsel

Corporate Lawyer

Investment Director

Business Development Manager

Company Secretary

Corporate Advisory Director

Mergers & Acquisitions Manager

Private Equity Manager

Venture Capital Associate

Investment Banker

Financial Controller

Board Director

Managing Director

Compliance Officer

Industries
Corporations Act 2001 (Cth): Primary legislation governing company operations, share transfers, shareholders' rights and obligations, and corporate governance requirements in Australia
Australian Securities and Investments Commission Act 2001: Regulates financial services and markets, including the trading of securities and options
Income Tax Assessment Act 1997: Governs the tax implications of share transfers and option exercises, including capital gains tax considerations
Competition and Consumer Act 2010: Contains the Australian Consumer Law and regulates fair trading practices, which may be relevant to share option arrangements
ASX Listing Rules: If the company is listed, these rules govern various aspects of share trading and disclosure requirements
Contract Law (Common Law and Equity): General principles of contract formation, interpretation, and enforcement that apply to shareholders agreements
Personal Property Securities Act 2009: May be relevant if shares or options are used as security interests
Foreign Acquisitions and Takeovers Act 1975: Relevant if foreign investors are involved in the option agreement
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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