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What types of shareholder agreements are illegal?

April 26, 2017agreements illegal shareholder types

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What types of shareholder agreements are illegal?

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While shareholders are permitted to contract with each other on how they will vote their shares, certain contractual goals are not permitted. If a shareholder agreement contemplates fraud on another shareholder, it will be void and illegal. Shareholders owe each other a fiduciary duty, thus shareholder agreements must be for the benefit of all shareholders. Similarly, shareholder agreements that have an illegal act as the purpose are void and illegal. Copyright © 2008 FindLaw, a Thomson Reuters business DISCLAIMER: This site and any information contained herein are intended for informational purposes only and should not be construed as legal advice. Seek competent counsel for advice on any legal matter.