Unlike mandatory documents like bylaws or articles of incorporation, shareholder agreements are not technically required by Montana law. But shareholder agreements can be very beneficial for small corporations, and often include a number of common features. For example, they can: specify what happens in the event of the death or retirement of a shareholder; create rights and obligations for buying and selling shares; and give shareholders rights to approve any new shareholders. Although shareholder agreements may have some content in common, each agreement is unique to the shareholders who form it.
Shareholder agreements can be particularly helpful for small and family-owned businesses because they clearly set out duties and rights - ideally avoiding confusion or disagreement among families and close business associates. They can also be coordinated with estate planning documents, allowing families to smoothly determine business succession in the event that a family-member shareholder becomes ill or dies.