Partnership & Shareholder Agreements
In forming a partnership or in small “close corporation,” one of the first and most important things that the business partners should do is put together a good partnership or shareholder agreement, and/or a buy-sell agreement. This should be done before money is exchanged, before a lease signed, and before the joint venture commences – or at least as soon as possible after that.
If the business is profitable, the operations transparent, and the partners/shareholders fair to each other, the agreement will remain invisible and in the background -- for such an agreement should not replace good and open communication.
However, if any of these elements are missing, the agreement can be used to short-circuit disputes by acting as a touchstone, spelling out the rights, duties and responsibilities of each of the involved parties.
In addition, in the event possible removal/buy-out of a partner or shareholder (due to disagreement, death or disability) or cessation of the joint venture, the agreement can help to avoid costly litigation by addressing the steps necessary to dissolve the business entity.
If you have a question about your legal rights, or wish to speak to an attorney about your situation, please call us today at 510-663-9240, or contact us online to discuss your legal rights.