Stockholder or Shareholder Agreements. Agreements between two or more shareholders providing voting rights, if any, are very important to the formation and operation of small businesses. Shareholder or Member Agreements are similar in many ways to a “premarital agreement” where business partners/shareholders plan for the demise of the partnership, corporation, or other entity. Sometimes the agreement includes creative ways to fund a buy-out through life insurance on the participating owners' lives to ensure that the buy–sell arrangement is well-funded and to guarantee that there will be money when the buy–sell event is triggered.
Common issues that the business law attorneys at our White Plains firm can address in the Agreement include: who can buy a departing partner's or shareholder's share of the business (outsiders or remaining partners/shareholders); When must the remaining partner or shareholder buy the other out of the business, (dispute, death, disability, retirement, departure) and; How to value the company (appraisal, arbitration, accountant, or other method); How will the price will be paid (cash note, etc.); Will a corporate trustee work for the type of business.