Apostrophe in “Shareholders Agreement”?

I’ve previously written about whether to use stockholder or shareholder; see MSDC 12.336 and this blog post. (I say it doesn’t matter which you use.)

Here’s a related issue that’s just as thrilling: should you say shareholders’ agreement, with an apostrophe, or shareholders agreement, without the apostrophe? (Obviously the same debate applies to stockholders’ agreement.) Note that if each agreement is signed by just one shareholder, the apostrophe would move one letter in: shareholder’s agreement.

I think it’s safe to say that the apostrophe makes sense. But it’s a little annoying, as not many contracts use in this manner a title that means “agreement between [collective noun].” That explains why my drastically unscientific search of contracts recently filed on the SEC’s EDGAR system suggest that two out of three contracts of this kind drop the apostrophe.

My search on EDGAR indicates that a third possibility—dropping the s at the end of shareholders—is quite popular. It’s used for contracts signed by more than one shareholder even though, strictly speaking, it suggests that the contract is signed by only one. But if you’re picking the least of three evils—the other two being (1) an anomalous apostrophe and (2) use of the plural in the absence of any connotation of the possessive—this one may be it.

What do you think? I invite you to take a stand on this momentous (not!) issue by casting a vote in the poll below.

About the author

Ken Adams is the leading authority on how to say clearly whatever you want to say in a contract. He’s author of A Manual of Style for Contract Drafting, and he offers online and in-person training around the world. He’s also chief content officer of LegalSifter, Inc., a company that combines artificial intelligence and expertise to assist with review of contracts.