A shareholder agreement is a critical document for any privately owned business with more than one owner. It should govern many key issues including board composition, decision making, share transfers, exits, and dispute resolution. These topics are often the most challenging circumstances in the life of a company and its decision-makers and owners. While AI generated agreements and online templates may seem like a quick and inexpensive option and often ‘look right’ to the untrained eye, they are generic by design. The issue is not how they read, but what they fail to account for. They are written without any reference to what’s going on in the business, the shareholders’ objectives, circumstances and risk appetite (which typically vary), and how the law applies in practice. A closer analysis often identifies inaccuracies, inconsistences and questions of enforceability, but by that time the damage may have already been done. Take for example, shareholders who rely on an AI generated agreement that lacks a workable exit and valuation mechanism. When one shareholder wants out, the uncertainty leads to disputes, delays, and significant legal costs far exceeding the cost of having the agreement properly drafted at the outset. The same scenario can also apply if a shareholder leaves with clients or valuable intellectual property and the generic AI restraint clause is unenforceable. A suitably skilled and experienced lawyer should ensure that your shareholder agreement is tailored, enforceable, and aligned with your commercial objectives; reducing risk and protecting value when it matters most. More than simply compiling standard clauses, that requires an understanding of the individual business, the relationships between its owners, and the risks that need to be managed. If you are considering documenting or updating a shareholder agreement, our Corporate & Commercial team would be pleased to assist.