Skip to content
Jurado & Associates, P.A. Business Law, Probate, Real Estate Law, Immigration, Litigation (305) 921-0976
  • TeamExpand
    • Romy B. Jurado, Esq.
    • Diana L. Collazos, Esq.
  • BusinessExpand
    • Litigation
    • Intellectual Property
    • Employment Contracts
    • Corporate Bylaws
    • Operating Agreements
    • business Registration
    • Asset Purchase Agreements
    • Commercial Leases
    • Noncompete Agreements
  • ImmigrationExpand
    • PERM
    • E-2
    • H-1B
    • EB-5
    • L-1
    • EB-2 / NIW
    • Treaty Visa Countries
  • Real EstateExpand
    • FIRPTA Withholding
    • Title Services
    • Post-Closing Services
    • Deeds and Title Documents
    • Pre-construction Properties
    • Short-Sale and Wholesale Properties
    • Real Estate Closings (Commercial and Residential)
  • ProbateExpand
    • Summary Administration
    • Formal Administration
    • Ancillary Administration
    • Creditor Rights
    • Estate Planning
    • Wills
    • Trusts
  • Blog
  • Contact
  • EnglishEnglishExpand
    • EspañolEspañol
✆ 3059210976
Phone (305) 921-0976
Jurado & Associates, P.A. Business Law, Probate, Real Estate Law, Immigration, Litigation (305) 921-0976

Shareholder Agreement

When Should Your Draft Your Shareholder Agreement?

Shareholder Agreement

Shareholder agreements should be drafted when the corporation is first formed, but they can be profitably be revised at various points along the trajectory of the corporation, as different challenges arise. Different provisions in shareholder agreements become more important during different phases of the company’s life cycle.

Initially, the founders of the company may be most interested in the shareholder agreement’s transfer restrictions and mechanisms for resolving deadlock. They may want to be sure that their partners will not sell stock to an outsider without their approval. They may want to know what happens when triggering events such as a divorce, death or disability occur.

Investments and Shareholder Agreements

As the company grows, it may receive investments from private equity or venture capital. The entities making such investments are generally very concerned  about the control they will have over the corporation. They may insist on a shareholder agreement that spells out structure of the board, appointment of officers, and information rights, as well as transfer restrictions, preemptive rights, and mechanisms for resolving deadlock. They may want preferred stock or debt instruments rather than common stock, to maximize flexibility and profit.

Even if the company does not receive investments from private equity or venture capital, the owners may want a shareholder agreement as they begin thinking about successor ownership and management of their business. As the partners begin to do estate planning, they may become more concerned about buy-out rights and transfer to heirs. They may become more concerned about needs for liquidity or for income for a surviving spouse.

S-Election and Shareholder Agreements

When a company makes an S-election or changes its structure in other ways, a shareholder agreement is important to make sure that any transfer will preserve the requirements of the new structure. For instance, a transfer by a shareholder to a corporation or a limited liability company could ruin an S-election.

In any event, a shareholders agreement should be executed before there is a falling out among the owners. If there are no agreements about composition of the board of directors, a founder may be voted off the board by a coalition of disaffected founders. Without buy-sell mechanisms triggered by a shareholder no longer working actively in the business, a shareholder may even go to work for a competitor yet keep her shares, including all the rights to information which accompany such shares.

Shareholder Agreement Questions? Call (305) 921-0976 or Romy@juradolawfirm.com

Call (305) 921-0976 or Message Us

Leave this field blank
  • Team
    • Romy B. Jurado, Esq.
    • Diana L. Collazos, Esq.
  • Business
    • Litigation
    • Intellectual Property
    • Employment Contracts
    • Corporate Bylaws
    • Operating Agreements
    • business Registration
    • Asset Purchase Agreements
    • Commercial Leases
    • Noncompete Agreements
  • Immigration
    • PERM
    • E-2
    • H-1B
    • EB-5
    • L-1
    • EB-2 / NIW
    • Treaty Visa Countries
  • Real Estate
    • FIRPTA Withholding
    • Title Services
    • Post-Closing Services
    • Deeds and Title Documents
    • Pre-construction Properties
    • Short-Sale and Wholesale Properties
    • Real Estate Closings (Commercial and Residential)
  • Probate
    • Summary Administration
    • Formal Administration
    • Ancillary Administration
    • Creditor Rights
    • Estate Planning
    • Wills
    • Trusts
  • Blog
  • Contact
  • EnglishEnglish
    • EspañolEspañol

Connect With Us

  • Facebook
  • Twitter
  • Instagram
  • Pinterest
  • LinkedIn
  • YouTube
Facebook Linkedin Twitter YouTube Instagram Phone Email

  • 10800 Biscayne Boulevard
    Suite 850
    Miami, Florida 33161
  • (305) 921-0976
  • info@juradolawfirm.com

Navigation

  • Home
  • About
  • Blog
  • Our Team
  • Contact

Quick Links

  • Litigation
  • Probate Law
  • Business Lawyer
  • Trademark Lawyer
  • Real Estate Law

Recent Posts

  • Can You Lose a Trademark If You Don’t Protect It? March 27, 2023
  • How to Buy a Small Business in Florida March 24, 2023
Search

© 2023 Jurado & Associates, P.A. Business Law, Probate, Real Estate Law, Immigration, Litigation (305) 921-0976

  • Team
    • Romy B. Jurado, Esq.
    • Diana L. Collazos, Esq.
  • Business
    • Litigation
    • Intellectual Property
    • Employment Contracts
    • Corporate Bylaws
    • Operating Agreements
    • business Registration
    • Asset Purchase Agreements
    • Commercial Leases
    • Noncompete Agreements
  • Immigration
    • PERM
    • E-2
    • H-1B
    • EB-5
    • L-1
    • EB-2 / NIW
    • Treaty Visa Countries
  • Real Estate
    • FIRPTA Withholding
    • Title Services
    • Post-Closing Services
    • Deeds and Title Documents
    • Pre-construction Properties
    • Short-Sale and Wholesale Properties
    • Real Estate Closings (Commercial and Residential)
  • Probate
    • Summary Administration
    • Formal Administration
    • Ancillary Administration
    • Creditor Rights
    • Estate Planning
    • Wills
    • Trusts
  • Blog
  • Contact
  • EnglishEnglish
    • EspañolEspañol
Phone (305) 921-0976Email info@juradolawfirm.com

10800 Biscayne Boulevard
Suite 850
Miami, Florida 33161

Search