Entrepreneurs and small businesses often get started by pooling capital from friends and family and other associates. Shared ownership in a new business will often lead to friction among members of the ownership group when major business issues arise, as inevitably they will. So an important part of the service we provide for our entrepreneurial and small business clients is putting in place a Shareholder Agreement. These Agreements provide an agreed upon basis to resolve conflict among the owners before it arises. Shareholder Agreements typically define the rights and responsibilities of the shareholder and provide for governance with respect to such things as management and control, transfer of shares, voting and dissolution.
Buy-Sell Agreements set forth the termination mechanism for a shareholder’s interest in the event of death, disability, business deadlock or transfer. These are all critical questions to address up front in order to preserve and protect enterprise value.