Disputes between business partners are common. Often, partners who were once on good terms suddenly find themselves embroiled in a serious conflict. One way to help avoid such situations—or to resolve them amicably—is through a shareholder agreement. However, conflict resolution isn’t the only purpose of shareholder agreements. Rather, shareholder agreements serve many purposes, and they are an important component of several types of business structures. For assistance drafting a shareholder agreement, please contact our experienced Florida corporate and business law attorney.
What Is a Shareholder Agreement?
A shareholder agreement is a legal contract that guides a company’s operations. When a dispute arises between two or more business partners, a shareholder agreement can be invaluable. This important document can address several key issues, including:
- Conflict of interest rules
- Shareholder obligations
- How to transfer rights and shares
- Dispute resolution options
- Buy/sell provisions
- Voting rights
- Director or officer restrictions, qualifications, compensation, appointment, and removal
- Stock dividends
- Corporate distributions
- Corporate powers
- Authority to break deadlocks
- Corporate dissolution
Who is Included in a Shareholder Agreement?
A shareholder agreement is an agreement between all of the shareholders in a business. Any person who owns stock in a company is considered a shareholder. However, not all shareholders are equal. A majority shareholder is a person who owns over 50% of a business’s stock, while a minority shareholder owns under this amount.
Types of Shareholder Agreements in Florida
Florida law recognizes two types of shareholder agreements: voting agreements and standard shareholder agreements.
Voting Agreement
Florida law authorizes parties to enter into voting agreements. This type of written agreement determines how shareholders will vote their shares. A common type of voting agreement is one that includes the predetermined dissolution of a corporation, which requires shareholders to vote for dissolution at a predetermined time.
Standard Agreement
Standard shareholder agreements provide guidelines for how a business will operate. As opposed to corporate bylaws, a standard shareholder agreement details the relationship among shareholders and their rights and responsibilities.
Why Draft a Shareholder Agreement?
There are many benefits to executing a shareholder agreement in Florida. For one, a well-drafted shareholder agreement in Florida can help prevent disputes between parties. This is particularly important for companies with no majority shareholders. In addition, a shareholder agreement can help maintain a business’s continuity by addressing the addition of new shareholders, the selling or transferring of shares, the governing structure of the company, and the procedures required to address unpredictable situations. Finally, shareholder agreements are confidential, providing a degree of privacy to company shareholders.
Contact a Florida Corporate and Business Law Attorney
If you need assistance drafting a shareholder agreement in Florida, you need an experienced Florida corporate and business law attorney on your side. At the distinguished Florida law firm of Gueronniere, P.A., we are passionate about helping business owners with their legal needs. When you come to us for help, experienced corporate and business law attorney Grace de law Gueronniere will review your situation, develop a plan of action, and take the steps necessary to ensure that you and your business remain protected. Whether you need help drafting a shareholder agreement, or you simply need general business law advice, we are here to help. Please contact us today to arrange an initial consultation with our knowledgeable Florida corporate and business law attorney.