All businesses are subject to unexpected issues and circumstances that simply cannot be anticipated. For this reason, it is critical for a business to have a clear and comprehensive ownership agreement to cover potential disputes over management and disagreements among owners, details on transfer restrictions and clear directions for possible purchase or sale events related to the business.
On any intake form when gathering information about a client’s business, an important first question is whether or not there is an ownership agreement. The type of agreement depends on the type of entity. For a corporation, it would be a shareholders or stockholders agreement. For a limited liability company (LLC), an operating agreement or a limited liability company agreement. For a partnership (general or limited), a partnership agreement. This article uses the generic “ownership agreement.”
