The Shareholders' Agreement: An Essential Tool for Securities Holders

The shareholders' agreement (pacte d'associés, or pacte d'actionnaires depending on the corporate form involved) ranks among the most structuring documents in the life of a company. Discreet, flexible, and highly customizable, it organizes the relationships between securities holders well beyond what the bylaws provide for. At Equisafe, where we support the tokenization of financial securities on EVM blockchains within a framework compliant with the requirements of the AMF (the French financial markets authority) and the MiCA regulation, we observe every day just how much the quality of this agreement determines the smoothness of capital operations.

What is a shareholders' agreement?

The shareholders' agreement is a private deed (acte sous seing privé) concluded between the partners or shareholders of a single company. Its purpose is to frame and define the relationships between the signatories, supplementing the bylaws with more granular, often confidential, commitments.

Each agreement has its own particularities regarding the allocation of shares, powers, and obligations. These variations arise directly from the negotiations conducted between the parties and from their willingness to include or exclude certain clauses. No two agreements are alike: each reflects the balance of power and the ambitions of the project at a given moment.

The contractual choices generally reflect the nature of the signatory partners: founders, financial investors, business angels, or employees holding an equity stake. Partners of different kinds may coexist within the same company. The agreement then offers an effective mechanism for establishing provisions applicable to certain categories of partners, granting specific rights or obligations and creating genuine orders of priority.

The agreement functions as a convention appended to the bylaws, without being able to contradict them. The bylaws retain superior legal value: the agreement applies only between the signatory partners and remains, in principle, unenforceable against third parties. This hierarchy is essential to understand, because a clause of the agreement that contravened the bylaws would be deprived of effect.

Did you know? When a company's securities are tokenized, the agreement retains its full legal value. Representing securities as tokens on an EVM blockchain does not alter the nature of the attached rights and obligations: it simply makes their traceability, the monitoring of the register, and the execution of certain clauses easier, as we will see below.

The agreement: a discreet ally serving partners and shareholders

The law generally requires the publication of the bylaws, but not that of the shareholders' agreement for unlisted companies. It is precisely this confidentiality that makes it a tool of choice: the parties can set out strategic commitments without exposing them to competitors, clients, or future partners.

The content of the agreement, applicable exclusively to the signatory parties, cannot in principle be disclosed to third parties. Moreover, if the agreement is not enforceable against third parties, the latter likewise cannot avail themselves of it. This legal watertightness protects the autonomy of the signatories' will.

This discretion does not, however, dispense with great rigor: an agreement poorly coordinated with the bylaws or with actual capital operations quickly loses its effectiveness. The centralized, time-stamped management of the capital, such as a tokenization platform enables, provides valuable support here in ensuring that securities movements remain consistent with the commitments made.

The structural elements of the shareholders' agreement

Although subject to the free assessment of the parties and to their specific needs, the majority of agreements are organized around four categories of clauses. The parties enjoy almost total freedom of negotiation regarding the inclusion, exclusion, or content of these provisions.

Each category governs a particular aspect of the relationships, rights, and commitments of the partners within the company.

First category: the fundamental clauses

The first group brings together the provisions deemed fundamental to the validity of the agreement. These clauses allow the agreement to be validly constituted, frame its application over time, and specify the company's governance.

They notably include:

• Term clauses
• Accession clauses
• Confidentiality clauses
• Non-compete clauses
• Exclusivity clauses
• Clauses governing departures
• Clauses relating to functions, the supervisory body, and the ad hoc committee, where applicable

Particular attention must be paid to the term clause: an agreement concluded for an indefinite term may be unilaterally terminated by any signatory, which weakens the entire negotiated balance. Tying the agreement's term to an objective event, such as the exit of an investor, provides greater security for the parties.

Second category: voting rights

The second category concerns the voting rights of the signatories. Considered the principal means of expression for partners and shareholders, the voting right is an essential prerogative that calls for rigorous arrangements.

These clauses notably allow:

• Establishing a reinforced right to information or to consultation
• Providing specific arrangements for certain particular decisions
• Directing the vote of a group of shareholders
• Granting a right of veto to certain partners

These provisions are particularly sensitive: a voting commitment must never result in permanently depriving a partner of the right to participate in collective decisions, on pain of nullity. The dematerialization of the register and the time-stamped convening of meetings simplify, in practice, the implementation of these clauses and their traceability.

Third category: the financial aspect

The third group organizes the financial aspect of holding securities and the pecuniary consequences that flow from it. These clauses revolve primarily around the allocation of profits and the distribution, or non-distribution, of dividends. They may also aim to stabilize the company's equity, for example through reinvestment commitments or partner current account (comptes courants d'associés) mechanisms.

In a tokenized environment, the distribution of financial flows, such as dividends, can be tracked in an automated and auditable manner, strengthening transparency toward all securities holders.

Fourth category: the terms of transfer of securities

The fourth category provides for the terms of transfer of securities and their effects, particularly with regard to the balance of capital and control of the shareholding. It is often the densest and most negotiated part of the agreement.

It notably includes:

• Approval clauses (clauses d'agrément)
• Anti-dilution clauses
• Preemption clauses
• Vesting clauses
• Liquidity clauses
• Forced-sale clauses (drag along)
• Joint-exit clauses (tag along)
• Change-of-control clauses
• Right-to-follow clauses (droit de suite)
• Withdrawal clauses
• Buy-back clauses
• Buy or sell clauses
• Good leaver or bad leaver clauses
• Investment-priority clauses
• Standstill clauses
• Clauses limiting holdings

These transfer clauses are the ones that benefit most directly from tokenization. The conditions of approval, preemption, or blocking of transfers can be reflected at the level of register management, so that no securities movement takes place outside the framework provided by the agreement. This articulation between law and technology considerably reduces the risk of non-compliant transfers and secures control of the shareholding.

Drafting rigor: an indispensable quality for an effective agreement

Intended to govern particular situations between different types of shareholders and partners, within a company that has its own rules, the agreement must demonstrate great precision. An ambiguous agreement generates litigation; a clear agreement prevents deadlocks.

Preliminary checks

It is first necessary to ensure that the fundamental clauses, essential to the validity of the agreement, comply with legal requirements, in particular as regards its term of implementation and the regime applicable to the company.

Generally speaking, the shareholders' agreement must not pursue an unlawful cause, such as an abuse of majority or minority. It must consistently remain aligned with the corporate interest (intérêt social), whatever the circumstances of its conclusion or execution.

If the agreement were to cause harm through its drafting or through the breach of its terms, this could justify the payment of damages and, in certain cases, its judicial rescission. The legal security of the operation therefore depends as much on the quality of the written text as on its proper execution over time.

Consistency and compatibility

It is essential to ensure consistency and compatibility between the clauses, particularly when they alternately confer rights on shareholders of different natures. The proper implementation of the agreement depends on the proportionality and purpose of the clauses: these must articulate clearly, without contradicting or neutralizing one another.

A frequent difficulty stems from the coexistence of several generations of agreements as financing rounds succeed one another. Maintaining a single, up-to-date document, coordinated with the bylaws and the securities register, avoids contradictions and gray areas.

What Equisafe brings: from the written agreement to secure execution

The shareholders' agreement remains a legal instrument. But its operational value depends on the fidelity with which it is executed day to day. This is where Equisafe comes in.

• Tokenization of securities on EVM blockchains. Financial securities are represented as tokens, providing a single, traceable, and auditable register of holders and their movements.
• Native regulatory compliance. Our infrastructure is designed in compliance with the requirements of the AMF and the MiCA regulation, so that tokenization and securities operations take place within a controlled framework.
• Institutional-grade security. The management of securities and transfers relies on high security standards, indispensable for founders and investors alike.
• Execution aligned with the agreement. Transfer, approval, and preemption rules are reflected in register management, limiting the risks of non-compliant transfers and facilitating financial distributions.

Ultimately, the shareholders' agreement remains a flexible and discreet tool which, when rigorously established, allows the signatories to optimize their stake and to avoid deadlock situations detrimental to the company. Combined with a compliant and secure tokenization infrastructure, it becomes a living instrument, executed faithfully throughout the life of the capital.