Shareholder Agreement - Missouri

SHAREHOLDER AGREEMENT — [CORPORATION NAME], a Missouri corporation

TABLE OF CONTENTS

1. Definitions
2. Purpose & Statutory Authorization
3. Transfer Restrictions
4. Buy-Sell (Triggering Events; Mandatory and Optional Purchase)
5. Valuation & Payment Terms
6. Voting Agreement; Board; Officers
7. Drag-Along & Tag-Along Rights
8. Preemptive Rights
9. Protective Provisions / Supermajority
10. Information Rights
11. Restrictive Covenants
12. Deadlock Resolution
13. Certificate Legend
14. Term & Termination
15. Dispute Resolution & Governing Law
16. General Provisions
17. Signatures
18. Sources & References

RECITALS AND PARTIES

THIS SHAREHOLDER AGREEMENT (this "Agreement") is made and entered into as of [__/__/____] (the "Effective Date") by and among [CORPORATION NAME], a Missouri corporation (the "Corporation"), and the persons listed on the Share Schedule below and who execute this Agreement (each, a "Shareholder" and, collectively, the "Shareholders").

RECITALS

A. The Corporation is a corporation organized and existing under the Missouri General and Business Corporation Law, Mo. Rev. Stat. ch. 351 (the "Act"), having its registered office in [COUNTY] County, Missouri.

B. The Corporation [has elected / shall elect] to be a statutory close corporation under Mo. Rev. Stat. §§ 351.750–351.865 by including in its Articles of Incorporation the statement required by Mo. Rev. Stat. § 351.755 that it is a statutory close corporation, and the Corporation has [50] or fewer shareholders.

C. As of the Effective Date, the authorized capital of the Corporation consists of [____] shares of [CLASS/SERIES] stock, [$____ par value / no par value], of which [____] shares are issued and outstanding and held of record by the Shareholders as set forth in the Share Schedule.

D. The Corporation is a closely-held corporation whose shares are not publicly traded. The Shareholders desire to provide for the management, ownership, and continuity of the Corporation; to restrict the transfer of its shares; to provide an orderly mechanism for the purchase and sale of shares upon certain events; to coordinate the voting of their shares and the composition of the Board; and to otherwise set forth their respective rights and obligations.

E. The persons signing this Agreement constitute ALL of the shareholders of the Corporation as of the Effective Date. The Shareholders intend that this Agreement be, and be enforceable as, a shareholder agreement under Mo. Rev. Stat. § 351.800.

NOW, THEREFORE, in consideration of the mutual covenants and agreements herein and other good and valuable consideration, the receipt and sufficiency of which are acknowledged, the parties agree as follows.

Share Schedule (Ownership as of the Effective Date)

1. DEFINITIONS

For purposes of this Agreement, the following terms have the meanings set forth below. Other terms are defined where they first appear.

"Act" means the Missouri General and Business Corporation Law, Mo. Rev. Stat. ch. 351, including the Statutory Close Corporation Law, §§ 351.750–351.865, as amended.

"Affiliate" means, as to any Person, any other Person that directly or indirectly controls, is controlled by, or is under common control with such Person.

"Agreed Value" has the meaning set forth in Section 5.1.

"Board" means the board of directors of the Corporation (if any; the Corporation may operate without a board under § 351.800 and § 351.805 if its Articles so provide).

"Business Day" means any day other than a Saturday, Sunday, or legal holiday in the State of Missouri.

"Disability" means a Shareholder's inability, by reason of physical or mental illness or injury, to perform substantially all of the duties such Shareholder customarily performs for the Corporation for a continuous period of [____] days or for [____] days in any [twelve (12)]-month period, as determined under Section 4.2(b).

"Fair Market Value" has the meaning set forth in Section 5.2.

"Immediate Family" means, consistent with Mo. Rev. Stat. § 351.765, a Shareholder's spouse, parents, lineal descendants (including adopted children and stepchildren) and the spouse of any lineal descendant, and brothers and sisters, and a trust all of whose beneficiaries are such persons.

"Permitted Transferee" has the meaning set forth in Section 3.3.

"Person" means an individual, corporation, partnership, limited liability company, trust, estate, association, or other entity.

"Purchase Price" means the price determined under Section 5 for shares purchased under this Agreement.

"Shares" means all shares of capital stock of the Corporation now owned or hereafter acquired by a Shareholder, and any security convertible into or carrying a right to subscribe for or acquire such shares.

"Statutory Close Corporation Law" means Mo. Rev. Stat. §§ 351.750–351.865.

"Transfer" means any sale, assignment, gift, pledge, hypothecation, encumbrance, or other disposition of Shares or any interest therein, whether voluntary or involuntary, by operation of law or otherwise.

"Triggering Event" has the meaning set forth in Section 4.1.

2. PURPOSE & STATUTORY AUTHORIZATION

2.1 Purpose

The purpose of this Agreement is to promote the Shareholders' mutual interests and the interests of the Corporation by imposing certain restrictions and obligations on the Shareholders and the Shares, and by providing for the continuity, governance, and orderly transfer of ownership of a closely-held Missouri corporation.

2.2 Statutory Basis

This Agreement is entered into under and is intended to be enforceable pursuant to Missouri law, including:

(a) Shareholder agreement (statutory close corporation). Mo. Rev. Stat. § 351.800 provides that all the shareholders of a statutory close corporation may agree in writing to regulate the exercise of the corporate powers and the management of the business and affairs of the corporation, or the relationship among the shareholders. Such an agreement is effective although it (1) eliminates a board of directors; (2) restricts the discretion or powers of the board or authorizes director proxies or weighted voting rights; (3) has the effect of treating the corporation as a partnership; or (4) creates a relationship among the shareholders, or between the shareholders and the corporation, that would otherwise be appropriate only among partners. Where the agreement restricts the discretion or powers of the board, § 351.800(3) relieves the directors of, and imposes on the persons in whom that discretion is vested, the corresponding liability. A provision eliminating the board is effective only if the Articles so state (§ 351.805), and a provision entitling a shareholder to dissolve is effective only if stated in the Articles (§ 351.845). This Agreement is intended to be such a shareholder agreement.

(b) Transfer restrictions. Under Mo. Rev. Stat. § 351.765, an interest in shares of a statutory close corporation may not be voluntarily or involuntarily transferred except as permitted by the Articles or under § 351.770, subject to the enumerated exceptions (transfers to the corporation or same-class holders, to Immediate Family or qualifying trusts, transfers approved in writing by all holders of general voting shares, transfers to an executor/administrator on death or a trustee/receiver in insolvency, certain mergers/exchanges, and pledges without voting rights). Mo. Rev. Stat. § 351.770 establishes a right of first refusal by which a shareholder desiring to transfer must first obtain a written third-party cash offer and offer the shares to the Corporation, which then has 20 days to call a special shareholders' meeting (held within 40 days) to decide whether to purchase all of the offered shares. The transfer restrictions in Section 3 supplement and implement §§ 351.765 and 351.770.

(c) Voting trusts. Mo. Rev. Stat. § 351.246 provides that any number of shareholders may create a voting trust conferring on a trustee the right to vote or otherwise represent their shares, for any period, without regard to the rule against perpetuities. To the extent the Shareholders elect to implement a voting trust, § 351.246 governs and is incorporated by reference. The voting provisions of Section 6 are intended to be enforceable as part of this § 351.800 shareholder agreement and under ordinary Missouri contract law.

2.3 Election of Status; Coordination with Charter Documents

The Shareholders shall cause the Articles of Incorporation to contain (or be amended to contain) the statutory-close-corporation election required by Mo. Rev. Stat. § 351.755, the board-elimination statement required by § 351.805 (if the Board is to be eliminated), and the dissolution-right statement required by § 351.845 (if any shareholder is to have a dissolution right). To the extent any provision of this Agreement departs from default governance, the Shareholders agree to cause corresponding provisions to be adopted in or referenced by the Articles and/or Bylaws and to take all action necessary to give them effect. In the event of a conflict between this Agreement and the Bylaws, the Shareholders shall, as among themselves, be bound by this Agreement and shall vote to conform the Bylaws to this Agreement.

3. TRANSFER RESTRICTIONS

3.1 General Prohibition

Consistent with Mo. Rev. Stat. § 351.765, no Shareholder shall Transfer all or any portion of such Shareholder's Shares except in strict compliance with this Agreement, the Articles, and applicable law. Any purported Transfer in violation of this Agreement shall be void, shall not be recognized on the books of the Corporation, and shall confer no rights upon the purported transferee.

3.2 Right of First Refusal

(a) Offer Notice. A Shareholder who desires to Transfer any Shares (the "Selling Shareholder") shall first obtain a bona fide written offer to purchase the Shares for cash from an eligible third party (as described in § 351.770) and shall deliver written notice (the "Offer Notice") to the Corporation and the other Shareholders. The Offer Notice shall state the offeror's name and address, the number and class/series of Shares offered (the "Offered Shares"), the offering price per Share, and all other material terms.

(b) Corporation's Option. Consistent with Mo. Rev. Stat. § 351.770, within [twenty (20)] days after the Corporation receives the Offer Notice, the Corporation shall call a special shareholders' meeting, to be held not more than [forty (40)] days after the call, to decide whether the Corporation should purchase all (but not less than all) of the Offered Shares. The purchase must be approved by a majority of the votes entitled to be cast, excluding votes in respect of the Offered Shares. The parties may, by this Agreement and the Articles, modify the close-corporation default procedure to provide a more streamlined option exercisable within [thirty (30)] days.

(c) Shareholders' Option. To the extent the Corporation does not elect to purchase all of the Offered Shares, the other Shareholders shall have an additional [thirty (30)] days to elect to purchase the remaining Offered Shares, pro rata in proportion to their respective holdings (with rights of over-allotment among electing Shareholders).

(d) Sale to Third Party. If the Corporation and the Shareholders do not collectively elect to purchase all of the Offered Shares within the option periods, the Selling Shareholder may, within [sixty (60)] days thereafter, Transfer the Offered Shares to the identified eligible third party at a price not less than, and on terms no more favorable to the transferee than, those in the Offer Notice, provided the transferee first executes a joinder agreeing to be bound by this Agreement. Any Shares not so transferred again become subject to this Agreement.

3.3 Permitted Transfers

Consistent with the exceptions in Mo. Rev. Stat. § 351.765(2), the right of first refusal in Section 3.2 shall not apply to, and a Shareholder may make, the following Transfers (each, a "Permitted Transfer"; each transferee, a "Permitted Transferee"), provided the transferee executes a joinder agreeing to be bound by this Agreement and the Shares remain subject hereto:

(a) a Transfer to the Corporation or to another holder of the same class or series of Shares;

(b) a Transfer to a member of the Shareholder's Immediate Family, or to a trust all of whose beneficiaries are members of the Shareholder's Immediate Family;

(c) a Transfer approved in writing by all of the holders of the Corporation's shares having general voting rights;

(d) a Transfer to an executor or administrator upon death, or to a trustee or receiver in a bankruptcy, insolvency, dissolution, or similar proceeding, subject to Section 4;

(e) a Transfer by merger, consolidation, or exchange under §§ 351.410 to 351.459; and

(f) a pledge as collateral for a loan that does not grant the pledgee any voting rights of the pledgor.

3.4 Prohibited Transfers

Except as set forth in Section 3.3, no Shareholder shall pledge, hypothecate, or grant a security interest in any Shares, or Transfer any Shares to a competitor of the Corporation, without the prior written consent of Shareholders holding at least [____]% of the outstanding Shares.

4. BUY-SELL: TRIGGERING EVENTS

4.1 Triggering Events

The occurrence of any of the following with respect to a Shareholder (a "Triggering Event"; such Shareholder, the "Affected Shareholder," or such Shareholder's estate or representative) gives rise to the purchase rights and obligations in this Section 4:

(a) Death of a Shareholder who is an individual;

(b) Disability of a Shareholder who is an individual;

(c) Termination of Employment of a Shareholder who is employed by the Corporation, whether voluntary or involuntary, with or without cause;

(d) Bankruptcy or Insolvency of a Shareholder, including the filing of a voluntary or involuntary petition, an assignment for the benefit of creditors, or the appointment of a receiver;

(e) Divorce of a Shareholder, to the extent any Shares (or marital interest therein) would be awarded to a non-Shareholder spouse;

(f) Involuntary Transfer by operation of law, levy, or attachment; and

(g) Voluntary Withdrawal by a Shareholder who delivers a written notice of intent to withdraw and sell.

4.2 Mandatory and Optional Purchase

(a) Death. Upon the death of a Shareholder, the Corporation [shall (mandatory) / may (optional)] purchase, and the deceased Shareholder's estate shall sell, all of the deceased Shareholder's Shares at the Purchase Price determined under Section 5. To the extent the Corporation does not purchase all such Shares, the surviving Shareholders [shall / may] purchase the balance pro rata. This contractual buy-sell is in addition to, and may supersede where elected, any compulsory-purchase right under §§ 351.780–351.790 (which apply only if the Articles so provide); per § 351.780(6), those sections do not prohibit any other agreement providing for the purchase of shares upon death.

(b) Disability. Disability shall be determined by a licensed physician selected by the Corporation (or, if the Affected Shareholder disputes the determination, by a third physician jointly selected by the Corporation's and the Shareholder's physicians). Upon a determination of Disability, the purchase mechanics in Section 4.2(a) apply.

(c) Termination of Employment. Upon Termination of Employment of a Shareholder, the Corporation and the other Shareholders shall have the option (and, if the parties so elect by completing the bracketed term, the obligation) to purchase the terminated Shareholder's Shares. The parties shall complete: purchase is [mandatory / optional]; in the case of termination [for cause], the Purchase Price shall be [Fair Market Value / __% of Fair Market Value / Agreed Value].

(d) Bankruptcy, Divorce, Involuntary Transfer, Voluntary Withdrawal. Upon any such Triggering Event, the Corporation (first) and the other Shareholders (second) shall have the option to purchase all of the Affected Shareholder's Shares (or the Shares subject to the involuntary transfer or divorce award) at the Purchase Price determined under Section 5. A non-Shareholder spouse or transferee is bound only to the extent applicable law and an enforceable joinder or restriction so provide. Under 11 U.S.C. § 541(c)(1), nothing in this Agreement excludes the ownership interest from a bankruptcy estate, binds a bankruptcy trustee beyond applicable law, or limits a trustee's statutory powers.

4.3 Closing

The closing of any purchase under this Section shall occur within [sixty (60)] days after the later of the Triggering Event or the final determination of the Purchase Price, at the Corporation's principal office. At closing, the seller shall deliver the certificates (or transfer instructions for uncertificated shares) duly endorsed, free of liens, and the buyer shall deliver the consideration in accordance with Section 5.3.

5. VALUATION & PAYMENT TERMS

5.1 Agreed Value

The Shareholders [may] establish an agreed value per Share (the "Agreed Value") by executing a Certificate of Agreed Value attached as Exhibit A, to be reviewed and updated at least annually. If a Certificate of Agreed Value has been executed within [twenty-four (24)] months before a Triggering Event, the Agreed Value shall be the Purchase Price.

5.2 Formula / Appraisal (Fair Market Value)

If no current Agreed Value exists, the Purchase Price shall be the "Fair Market Value" of the Shares, determined as follows (the parties shall select one method):

(a) Formula. [Describe formula — e.g., [____] times trailing twelve-month EBITDA, less indebtedness, multiplied by the selling percentage]; or

(b) Appraisal. Fair Market Value shall be determined by an independent appraiser. The Corporation and the seller shall each select one qualified appraiser within [fifteen (15)] days; if the two appraisals are within [ten percent (10%)] of each other, the Fair Market Value is their average; otherwise, the two appraisers shall select a third, whose determination (within the range of the first two) is binding. The appraisal shall [apply / not apply] minority and marketability discounts.

5.3 Payment Terms

(a) Cash / Insurance Proceeds. At closing, the buyer shall pay [____]% of the Purchase Price in cash, including any life-insurance proceeds applied under Section 5.4.

(b) Promissory Note. The balance shall be evidenced by a promissory note payable in [____] equal [monthly / quarterly / annual] installments over [____] years, bearing interest at [the applicable federal rate / ____% per annum], secured by a pledge of the purchased Shares, with the right to prepay without penalty. Any purchase by the Corporation is subject to the distribution limitations of Mo. Rev. Stat. § 351.220.

5.4 Life-Insurance Funding

(a) The Corporation [and/or the Shareholders] may purchase and maintain life-insurance policies on the lives of the Shareholders to fund the purchase obligations on death. The Corporation shall be the [owner and beneficiary] of such policies.

(b) The policies and beneficiaries are listed on Exhibit B. Upon a Shareholder's death, the proceeds shall be applied first to the Purchase Price for that Shareholder's Shares. Proceeds exceeding the Purchase Price shall belong to the Corporation.

(c) A Shareholder whose Shares are purchased (or such Shareholder's estate) shall have the option to purchase any policy on such Shareholder's life for its interpolated terminal reserve (cash surrender) value.

6. VOTING AGREEMENT; BOARD; OFFICERS

6.1 Voting Agreement

Each Shareholder agrees to vote all Shares now or hereafter owned by such Shareholder, and to take all other action within such Shareholder's control (including executing written consents under the Act), so as to give effect to the provisions of this Section 6. This Section is intended to be enforceable as part of the § 351.800 shareholder agreement and under Missouri contract law, and the Shareholders may implement it through a voting trust under Mo. Rev. Stat. § 351.246.

6.2 Board Composition (If a Board Is Retained)

(a) If the Corporation retains a Board, the Board shall consist of [____] directors.

(b) Each Shareholder (or group of Shareholders) holding at least [____]% of the outstanding Shares shall be entitled to designate [one (1)] director, and the Shareholders shall vote their Shares to elect each such designee. A designating Shareholder may remove and replace its designee at any time, and the Shareholders shall vote accordingly.

(c) A vacancy created by a designated director shall be filled only by the Shareholder entitled to designate that director.

6.3 Management Without a Board (If Elected)

If the Articles eliminate the Board under § 351.805, the business and affairs of the Corporation shall be managed by the Shareholders as provided in this Agreement, who shall have the powers and the corresponding liabilities of directors under § 351.800(3), and references in this Agreement to the "Board" shall be read to refer to the Shareholders acting in that capacity.

6.4 Officers

The Shareholders shall cause the appointment of the following officers (or persons performing equivalent functions), who shall serve until removed in accordance with this Agreement or the Bylaws: [President / CEO: ____; Secretary: ____; Treasurer/CFO: ____].

6.5 Cumulative Voting

Under Mo. Rev. Stat. § 351.245(3), shareholders have the right to cumulate votes in electing directors unless the Articles or Bylaws provide otherwise. The Shareholders agree to vote so as to implement the designation rights in Section 6.2, and the Articles or Bylaws [shall / shall not] eliminate cumulative voting.

7. DRAG-ALONG & TAG-ALONG RIGHTS

7.1 Drag-Along

If Shareholders holding at least [____]% of the outstanding Shares (the "Dragging Shareholders") approve a bona fide arm's-length sale of the Corporation (whether by sale of shares, merger, or sale of substantially all assets) to an unaffiliated third party, the Dragging Shareholders may require each other Shareholder to (a) vote all Shares in favor of the transaction, (b) sell the same proportion of Shares on the same per-share terms, and (c) execute reasonable transaction documents, provided that no Shareholder shall be required to give representations other than as to title, authority, and ownership, and that liability shall be several (not joint) and capped at the proceeds received.

7.2 Tag-Along

If one or more Shareholders (the "Transferring Shareholders") propose to Transfer, in one transaction or a series, Shares representing more than [____]% of the outstanding Shares to a third party (other than a Permitted Transfer), each other Shareholder may elect to participate in the sale on the same terms, selling a pro rata portion of its Shares. The Transferring Shareholders shall give at least [twenty (20)] days' written notice of the proposed sale, and each electing Shareholder shall respond within [ten (10)] days.

8. PREEMPTIVE RIGHTS

8.1 Grant

Except for Exempt Issuances, before the Corporation issues any new Shares or securities convertible into Shares, it shall offer each Shareholder the right to purchase such Shareholder's pro rata portion (based on then-current ownership) on the same price and terms, so as to maintain such Shareholder's percentage ownership.

8.2 Procedure

The Corporation shall deliver written notice of the proposed issuance describing the securities, price, and terms. Each Shareholder shall have [twenty (20)] days to elect to exercise its preemptive right. Shares not subscribed for may be issued to the proposed purchaser within [ninety (90)] days on terms no more favorable than those offered to the Shareholders.

8.3 Exempt Issuances

"Exempt Issuances" means issuances (a) under a board- or shareholder-approved equity-incentive plan, (b) upon conversion or exercise of outstanding securities, (c) in connection with a bona fide acquisition or strategic transaction approved under Section 9, or (d) approved by Shareholders holding at least [____]% of the outstanding Shares.

9. PROTECTIVE PROVISIONS / SUPERMAJORITY

Notwithstanding any contrary provision of the Bylaws, the Corporation shall not take any of the following actions without the approval of Shareholders holding at least [____]% of the outstanding Shares (or the unanimous consent where indicated):

(a) amending the Articles of Incorporation or Bylaws (including any amendment affecting statutory-close-corporation status);

(b) issuing additional Shares or securities (other than Exempt Issuances) or creating a new class or series;

(c) declaring or paying any dividend or distribution other than pro rata;

(d) merging, consolidating, converting, or selling all or substantially all assets;

(e) dissolving, liquidating, or filing for bankruptcy;

(f) incurring indebtedness in excess of [$____] or granting liens on material assets;

(g) entering into any transaction with a Shareholder, director, officer, or Affiliate other than on arm's-length terms;

(h) materially changing the nature of the Corporation's business; and

(i) approving annual compensation of any officer in excess of [$____].

The parties may, consistent with Mo. Rev. Stat. § 351.265, also establish greater quorum or voting requirements in the Articles of Incorporation or Bylaws.

10. INFORMATION RIGHTS

The Corporation shall deliver to each Shareholder: (a) annual financial statements within [one hundred twenty (120)] days after fiscal year-end; (b) quarterly unaudited statements within [forty-five (45)] days after each fiscal quarter; and (c) upon [five (5)] Business Days' notice, reasonable access during normal business hours to the books and records the Corporation is required to maintain, consistent with the shareholder inspection rights under Mo. Rev. Stat. § 351.215, subject to a confidentiality undertaking and any proper-purpose limitations. Upon written request and without charge, the Corporation shall provide copies of provisions that restrict transfer or affect voting or other rights of shareholders, as required by Mo. Rev. Stat. § 351.760(5).

11. RESTRICTIVE COVENANTS

11.1 Non-Competition

During the period each Shareholder owns Shares and for [two (2)] years thereafter, no Shareholder who is also an employee, officer, or director shall, within [geographic area], directly or indirectly engage in or own an interest in any business that competes with the Corporation, except for passive ownership of less than [two percent (2%)] of a publicly traded company. The parties intend this covenant, given in connection with each Shareholder's equity interest, to be reasonable and enforceable under Missouri common law and, where applicable, Mo. Rev. Stat. § 431.202.

11.2 Non-Solicitation

During the same period, no such Shareholder shall solicit (a) any employee or contractor of the Corporation to terminate their relationship, or (b) any customer or supplier to cease or reduce business with the Corporation.

11.3 Confidentiality

Each Shareholder shall hold in confidence all confidential and proprietary information and trade secrets of the Corporation and shall not use or disclose them except for the benefit of the Corporation, both during and after the period of share ownership.

11.4 Remedies; Reformation

The Shareholders acknowledge that breach of this Section would cause irreparable harm and agree that the Corporation shall be entitled to injunctive relief in addition to other remedies. If any covenant is held overbroad, the parties request that a Missouri court modify or "blue-pencil" it to the maximum enforceable scope.

12. DEADLOCK RESOLUTION

12.1 Deadlock Defined

A "Deadlock" exists if the Board (or the Shareholders managing the Corporation) or the Shareholders are unable, after [two (2)] properly noticed meetings held at least [fifteen (15)] days apart, to reach the vote required to act on a material matter, and the inability materially impairs the Corporation's business.

12.2 Escalation; Mediation

Upon a Deadlock, the matter shall first be referred to the senior representatives of the disputing Shareholders for good-faith negotiation for [thirty (30)] days, and then, if unresolved, to non-binding mediation under Section 15.

12.3 Buy-Sell Shotgun

If a Deadlock remains unresolved [sixty (60)] days after mediation begins, any Shareholder (or 50% group) (the "Offeror") may deliver a written notice to the other (the "Offeree") stating a price per Share. The Offeree shall, within [thirty (30)] days, elect either (a) to sell all of its Shares to the Offeror at that price, or (b) to buy all of the Offeror's Shares at that same price. Failure to elect within the period shall be deemed an election to sell. The resulting purchase shall close under Section 4.3 and be paid under Section 5.3.

12.4 Other Remedies

The buy-sell procedure is in addition to, and not in lieu of, the parties' statutory rights. A statutory close corporation may, under Mo. Rev. Stat. § 351.845, provide in its Articles that one or more shareholders (or a specified number/percentage) may dissolve the Corporation at will or on a specified event; and a deadlocked or oppressed shareholder may seek relief under Mo. Rev. Stat. §§ 351.494 (judicial dissolution) and 351.850 (ordinary and extraordinary relief for statutory close corporations, including buy-out).

13. CERTIFICATE LEGEND

Each certificate representing Shares shall bear the following conspicuous legend, which incorporates the statutory-close-corporation status notice required by Mo. Rev. Stat. § 351.760(1) (and, for uncertificated shares, the written notice required by § 351.760(2)):

THE RIGHTS OF SHAREHOLDERS IN A STATUTORY CLOSE CORPORATION MAY DIFFER MATERIALLY FROM THE RIGHTS OF SHAREHOLDERS IN OTHER CORPORATIONS. COPIES OF THE ARTICLES OF INCORPORATION AND BYLAWS, SHAREHOLDERS' AGREEMENTS, AND OTHER DOCUMENTS, ANY OF WHICH MAY RESTRICT TRANSFERS AND AFFECT VOTING AND OTHER RIGHTS, MAY BE OBTAINED BY A SHAREHOLDER ON WRITTEN REQUEST TO THE CORPORATION.

THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE TRANSFER RESTRICTIONS (MO. REV. STAT. §§ 351.765, 351.770), VOTING AGREEMENT, AND OTHER TERMS OF A SHAREHOLDER AGREEMENT DATED [__/__/____] ENTERED INTO UNDER MO. REV. STAT. § 351.800, AND MAY NOT BE TRANSFERRED EXCEPT IN COMPLIANCE WITH THAT AGREEMENT. THE SHARES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 OR ANY STATE SECURITIES LAW AND MAY NOT BE TRANSFERRED ABSENT REGISTRATION OR AN EXEMPTION THEREFROM.

Under Mo. Rev. Stat. § 351.760(3)–(4), the § 351.760 notice satisfies the close-corporation requirement that notice of share-transfer restrictions be given, and a person claiming an interest in shares of a corporation that has complied with the notice requirement is bound by the documents referred to in the notice.

14. TERM & TERMINATION

14.1 Term

This Agreement becomes effective on the Effective Date and continues until terminated under Section 14.2.

14.2 Termination

This Agreement terminates upon the earliest of: (a) the written agreement of all Shareholders; (b) the dissolution, bankruptcy, or liquidation of the Corporation; (c) a single Shareholder coming to own all outstanding Shares; (d) the termination of the Corporation's statutory-close-corporation status under §§ 351.825–351.840; or (e) the closing of an initial public offering or listing of the Corporation's shares on a national securities exchange.

14.3 Effect of Termination

Termination does not affect rights or obligations that accrued before termination, including any closing of a purchase already triggered. The confidentiality obligations of Section 11.3 survive termination.

14.4 Amendment

This Agreement may be amended only by a writing signed by all Shareholders, as required for a § 351.800 shareholder agreement by Mo. Rev. Stat. § 351.800(6), unless this Agreement expressly provides for amendment by a lesser percentage as to a specified matter. The parties may specify that certain provisions require unanimous consent.

15. DISPUTE RESOLUTION & GOVERNING LAW

15.1 Governing Law

This Agreement is governed by and construed in accordance with the laws of the State of Missouri, without regard to conflict-of-laws principles, and the internal affairs of the Corporation are governed by the Act.

15.2 Mediation

Before commencing arbitration or litigation (other than for injunctive relief), the parties shall attempt in good faith to resolve any dispute through non-binding mediation administered by [mediation provider] in [County] County, Missouri.

15.3 Arbitration

Any dispute not resolved by mediation shall be finally resolved by binding arbitration administered by the [American Arbitration Association] under its Commercial Arbitration Rules, before [one (1) / three (3)] arbitrator(s), seated in [City], Missouri. Judgment on the award may be entered in any court of competent jurisdiction.

15.4 Forum; Injunctive Relief

Notwithstanding Section 15.3, any party may seek temporary or preliminary injunctive relief or specific performance (including to enforce Sections 3, 6, and 11) from the state or federal courts located in [County] County, Missouri, to which the parties submit to jurisdiction and venue.

15.5 Attorneys' Fees

The prevailing party in any proceeding to enforce this Agreement is entitled to recover reasonable attorneys' fees and costs.

15.6 Jury Trial Waiver

EACH PARTY KNOWINGLY AND VOLUNTARILY WAIVES ANY RIGHT TO TRIAL BY JURY IN ANY PROCEEDING ARISING OUT OF THIS AGREEMENT NOT SUBJECT TO ARBITRATION.

16. GENERAL PROVISIONS

16.1 Specific Performance

The parties agree that the Shares are unique, that monetary damages are inadequate for breach of this Agreement, and that the non-breaching parties are entitled to specific performance.

16.2 Further Assurances

Each party shall execute such further documents and take such further actions as may be reasonably necessary to carry out this Agreement, including effecting and maintaining the statutory-close-corporation election under § 351.755.

16.3 Notices

All notices shall be in writing and delivered personally, by nationally recognized overnight courier, or by certified mail (return receipt requested) to the addresses on Exhibit C, and are effective upon receipt (or refusal).

16.4 Successors and Assigns; Joinder

This Agreement binds and inures to the benefit of the parties and their respective heirs, personal representatives, successors, and permitted assigns. No Person shall acquire Shares unless such Person first executes a joinder agreeing to be bound by this Agreement.

16.5 Severability

If any provision is held invalid or unenforceable, it shall be reformed to the minimum extent necessary, and the remaining provisions shall remain in full force and effect.

16.6 Entire Agreement

This Agreement, together with its Exhibits, constitutes the entire agreement among the parties regarding its subject matter and supersedes all prior understandings.

16.7 Counterparts; Electronic Signatures

This Agreement may be executed in counterparts and by electronic signature, each of which is deemed an original and all of which together constitute one instrument.

16.8 No Third-Party Beneficiaries

Except as expressly provided, this Agreement is solely for the benefit of the parties and their permitted successors and assigns.

17. SIGNATURES

IN WITNESS WHEREOF, the parties have executed this Shareholder Agreement as of the Effective Date.

THE CORPORATION:

[CORPORATION NAME], a Missouri corporation

By: [________________________________]

Name: [____________________]

Title: [____________________]

Date: [__/__/____]

THE SHAREHOLDERS:

[________________________________]
Name: [____________________]
Date: [__/__/____]

[________________________________]
Name: [____________________]
Date: [__/__/____]

[________________________________]
Name: [____________________]
Date: [__/__/____]

18. SOURCES & REFERENCES

• Missouri General and Business Corporation Law, Mo. Rev. Stat. ch. 351.
• Missouri Statutory Close Corporation Law, Mo. Rev. Stat. §§ 351.750–351.865.
• Mo. Rev. Stat. § 351.755 — Definition; election of statutory-close-corporation status (50 or fewer shareholders; two-thirds approval; qualifications of shareholders).
• Mo. Rev. Stat. § 351.800 — Shareholder agreements (all shareholders may regulate corporate powers/management; effective although it eliminates the board, restricts board discretion, authorizes director proxies/weighted voting, or treats the corporation as a partnership; director-liability shift; unanimous amendment unless otherwise provided).
• Mo. Rev. Stat. § 351.805 — Articles statement required to eliminate the board of directors.
• Mo. Rev. Stat. § 351.760 — Notice of statutory close corporation status on issued/uncertificated shares; binding effect; free copies on request.
• Mo. Rev. Stat. § 351.765 — Share transfer prohibition (and enumerated exceptions).
• Mo. Rev. Stat. § 351.770 — Share transfer after first refusal by the corporation (ROFR procedure; 20-day call / 40-day meeting; majority-of-disinterested vote).
• Mo. Rev. Stat. §§ 351.780–351.790 — Compulsory purchase of shares after death of a shareholder (applies only if the Articles so provide; § 351.785 sets the exercise procedure).
• Mo. Rev. Stat. § 351.845 — Shareholder option to dissolve a statutory close corporation (if stated in the Articles).
• Mo. Rev. Stat. § 351.850 — Ordinary and extraordinary relief (including buy-out) for statutory close corporations.
• Mo. Rev. Stat. § 351.246 — Shareholders may create a voting trust (any period; no rule against perpetuities).
• Mo. Rev. Stat. § 351.245(3) — Cumulative voting for directors (default).
• Mo. Rev. Stat. § 351.305 — Preemptive rights (may be limited or denied by the Articles).
• Mo. Rev. Stat. § 351.220 — Distributions / limitations relevant to corporate share purchases.
• Mo. Rev. Stat. § 351.215 — Shareholder inspection of corporate records.
• Mo. Rev. Stat. § 351.494 — Judicial dissolution.
• Mo. Rev. Stat. § 431.202 — Validity of certain non-compete / non-solicitation agreements.