Corporate contract: main features + contract template

The concept of a corporate contract appeared for the first time in Ukrainian legislation in the Law of Ukraine "On Limited and Additional Liability Companies".

Yes, according to Art. 7 of the Law "On limited and additional liability companies" , the contract under which the members of the company undertake to exercise their rights and powers in a certain way or refrain from exercising them (hereinafter - the corporate contract ) is free of charge and is made in writing. A corporate agreement that does not meet these requirements is null and void . The party to the corporate agreement can also be the company itself and third parties.

The date of conclusion and term of validity of the corporate agreement are determined in the agreement.

A corporate agreement may provide for conditions or a procedure for determining the conditions under which a participant has the right or obligation to buy or sell a share in the authorized capital (part thereof), as well as determine the cases when such a right or obligation arises.

The corporate agreement, which establishes the obligation of the participants to ensure voting in accordance with the instructions of the management bodies of the company, is null and void.

The content of the corporate agreement is not subject to disclosure and is confidential, unless otherwise established by law or contract. A corporate agreement, to which the state, territorial community, state or communal enterprise or legal entity, in the authorized capital of which 25 percent or more is directly or indirectly owned by the state or territorial community, is a party, shall be made public within 10 days from the moment of its conclusion by placing it on the website of the relevant body state power, local self-government body.

A contract concluded by a party to a corporate contract for breach of such corporate contract is null and void if the other party to the contract knew or should have known about such a breach.

In addition to the mentioned Law , the corporate agreement is also regulated by the Law of Ukraine "On Business Societies" .

Thus, the Law of Ukraine "On Business Societies" was supplemented by Art. 51-1 with the entry into force of the Law of Ukraine "On Amendments to Certain Legislative Acts of Ukraine Regarding Corporate Contracts".

Yes, according to Art. 51-1 of the Law "On Business Companies" (agreement on the realization of the rights of participants (founders) of a limited liability company), the contract on the realization of the rights of participants (founders) of a limited liability company shall be recognized as an agreement on the specifics of the realization of the rights of participants (founders) of a limited liability company . According to the agreement on the realization of the rights of the participants (founders) of the limited liability company, its parties undertake to implement in the manner provided by such an agreement the rights granted to the participants (founders) of the limited liability company, and/or to refrain from the implementation of the specified rights. The agreement on the realization of the rights of the participants (founders) of a limited liability company may stipulate the obligation of its parties to vote in the manner specified by such an agreement at the general meeting of the participants (founders) of the limited liability company, to agree on the acquisition or disposal of a share at a predetermined price and /or in the event of the occurrence of the circumstances specified in the contract, refrain from alienating the shares until the occurrence of the circumstances specified in the contract, as well as take other actions related to the management of the limited liability company, its termination or the separation of a new legal entity from it. The contract on the realization of the rights of the participants (founders) of the limited liability company may provide for the conditions or the procedure for determining the conditions on which the participant of the company - a party to the contract is entitled or obliged to purchase or sell shares in the authorized capital of the company, and determine the cases (which may or may not depend depend on the actions of the parties) when such a right or obligation arises.

The agreement on the realization of the rights of the participants (founders) of the limited liability company is concluded in writing. The authenticity of the signatures of the participants (founders) of the limited liability company - natural persons on such a contract is certified in accordance with the established procedure. The date of entry into force of the agreement on the realization of the rights of the participants (founders) of the limited liability company is determined by this agreement. The contract on the realization of the rights of the participants (founders) of the limited liability company is concluded for a specified period or indefinitely.

The subject of an agreement on the realization of the rights of participants (founders) of a limited liability company cannot be the obligation of the parties to this agreement to vote in accordance with the instructions of the management bodies of the limited liability company, in respect of whose shares this agreement is concluded, except in cases where the party to the agreement is a person who at the same time is a member of the management body of such a company.

The terms of the contract on the realization of the rights of the participants (founders) of the limited liability company, which contradict the requirements of the third part of this article, are null and void.

The contract on the realization of the rights of the participants (founders) of the limited liability company is binding only for its parties.

An agreement concluded by a party to an agreement on the realization of the rights of participants (founders) of a limited liability company for violation of this agreement can be declared invalid by the court at the request of an interested party to an agreement on the implementation of the rights of participants (founders) of a limited liability company only if it is proven that that the other party to the contract knew or should have known about the restrictions stipulated by the contract on the realization of the rights of the participants (founders) of the limited liability company.

Information on the conclusion of an agreement on the realization of the rights of participants (founders) of a limited liability company is notified to such a company by one of the parties to the agreement within three working days from the date of its conclusion. In such a notification, the term of validity and the parties to such an agreement must be specified, and other information may be specified at the request of the parties to the agreement.

Unless otherwise established by law or the contract on the realization of the rights of the participants (founders) of the limited liability company, information on the content of the contract on the realization of the rights of the participants (founders) of the limited liability company is not subject to disclosure and is confidential.

Violation of the agreement on the realization of the rights of the participants (founders) of the limited liability company cannot be the basis for invalidating the decisions of the bodies of the limited liability company.

In the event of a violation of the contract on the realization of the rights of the participants (founders) of the limited liability company, which stipulates the obligation of the party to this contract to purchase or sell a share in the authorized capital of this company at a predetermined price and/or in the event of the occurrence of the circumstances specified in the contract, the interested party of the contract may file a lawsuit for the enforcement of this obligation by obliging the party to the contract to exercise the rights of the participants (founders) of the limited liability company to purchase (sell) a share on the terms specified by this contract.

The agreement on the realization of the rights of the participants (founders) of the limited liability company may provide for methods of ensuring the fulfillment of obligations arising from this agreement, and measures of civil liability for non-fulfillment or improper fulfillment of such obligations.

Creditors of the company may enter into an agreement with the members of the limited liability company, according to which the members of the company, in order to ensure the legally protected interest of such third parties, undertake to exercise their corporate rights in the manner provided for in such an agreement, or refrain from (refuse) their exercise, in that including voting in the manner provided by such an agreement at the general meeting of members of a limited liability company, agreeing to perform other actions related to the management of such a company, to purchase or sell shares in its authorized capital at a certain price or on the condition that the circumstances specified in the agreement occur or refrain from alienating shares until the circumstances specified in the contract occur. The general provisions on the contract on the realization of the rights of the participants (founders) of the limited liability company shall apply to the specified contract, unless otherwise established by law or does not follow from the essence of the relations of the parties.

You can create a Corporate Agreement in the Instaco constructor by following the link . To create, you only need to enter the necessary data in the designer.