Great White North VC blogger, Rick Segal (on my blogroll forever), has a must read post for start-ups issuing shares .

Here is the most important advice:

Shareholders agreement, minority rights and voting trusts are things you need to learn about before you give out the first share of your company.

The most important thing you can do is create a voting trust/minority shareholders agreement for all these 100 share or 1000 share things you will likely do in exchange for services or cash. Most people that help a start up are generally doing it to help you, to be nice, not looking for the retirement investment. They are taking a bit of a flyer on you. Toward that end, those people are about as passive as you can get. They should have no problem signing up for a structure that basically has them along for the ride. I’m not a lawyer so in non-legal terms you need to have an agreement in place that accomplishes these objectives:
• Prevents you chasing around the globe for shareholder signatures.
• Puts the minority shareholders in a voting trust
• Has a specific agreement that clearly identifies the rights/privileges of the minority shareholders.

Thanks Rick.