DIY Legal Forms

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Shareholders Agreement to Submit Claims to Arbitration

1. Parties. The undersigned are all of the shareholders of Corporation (Shareholders). Corporation joins in this Agreement to evidence its consent to the submission of its claims to arbitration in accordance with this Agreement.

2. Submission to Arbitration. All claims or disputes specified in Paragraph 3, whether between or among the Shareholders or between or among Corporation and one or more Shareholders, shall be submitted to arbitration in [county, state] before a single Arbitrator, in accordance with the rules then in effect of the American Arbitration Association.

3. Issues Subject to Arbitration. Any claims or disputes relating to the following issues shall be submitted to arbitration as provided in this Agreement:

a. The validity, construction, or alleged breach of this Shareholders Agreement

b. The conduct of the affairs of Corporation, including the authorization, issuance, repurchase, or redemption of shares, the election or removal of officers and directors, the employment and discharge of employees, the sale, lease, mortgage, or pledge of all or any portion of the assets of Corporation, the dissolution, merger, consolidation, or liquidation of Corporation, and any term of or amendment to the certificate of incorporation or the bylaws of Corporation

c. Any sale, transfer, pledge, or other disposition, whether voluntary or involuntary, of any of the shares of Corporation.

d. Any alleged breach of the duties owned by any of the parties to the others, whether under this Agreement or otherwise, including an alleged breach of fiduciary duty

e. Any issues relating to the validity or meaning of this Agreement, including the arbitrability of any claim or dispute

4. Issues Not Subject to Arbitration. The undersigned expressly agree that any claims of disputes relating to the following issues are not subject to arbitration, notwithstanding the provisions of Paragraph 3:

[nature of issues, e.g., stock value]

5. Right to Dissolution. Any Shareholder is entitled to seek a dissolution of Corporation, notwithstanding the provisions of Paragraph 3, if one or more of the following events occur:

[description of events]

6. Remedies. The Arbitrator has the right, in addition to any other relief permitted at law or in equity, to award counsel fees to any party and to grant temporary or permanent injunctive relief. In enforcing or implementing any award, the Arbitrator has the right to vote the shares of the Shareholders. The Shareholders each grant the Arbitrator an irrevocable proxy, coupled with an interest, to vote that Shareholder's shares for this purpose.

7. Final Award. The award rendered by the Arbitrator in any arbitration under this Agreement is final and binding on the parties. Judgment may be entered on such award in any court having competent jurisdiction.

8. Further Assurance. Each party to this Agreement will perform all acts, including the execution and delivery of further documents, as the Arbitrator determines is necessary or desirable to confirm and carry out the terms of the award rendered.





By: [signature]


*** If Required By State Law ***

This Section for Notary:


State of _________

County of ________ [COUNTY]

On [DATE] before me, [NAME OF NOTARY], notary, personally appeared [NAME OF PERSON(S) INVOLVED], personally known to me (or proved to me on the basis of satisfactory evidence) to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.

Witness my hand and official seal.

Signature ________

My commission expires: _____