Shareholder And Operating Agreements

It is critical when forming or carrying on a business with more than one owner that the rights and obligations of partners in the business are clearly delineated in a written document. The relationships between business partners in a corporation are governed by a Shareholder Agreement or, in the case of a limited liability company, an Operating Agreement. A Shareholder or Operating Agreement sets forth the manner in which business decisions may be made amongst business partners, the manner of distributing the profits and losses of the business and other rules of business governance. In many instances, the terms of a Shareholder Agreement or Operating Agreement will dictate how certain business disputes are resolved, and numerous expensive and contentious lawsuits have taken place which could have otherwise been avoided had the partners in the business taken the vital step of negotiating their rights and obligations into an agreement beforehand. Weiss Zarett Brofman Sonnenklar & Levy, P.C., has extensive experience with issues of corporate governance and the drafting of Shareholder and Operating Agreements in both health care-related business and other business entities.