With the exception of a sole proprietorship, small businesses often have more than one “owner.” Business owned as a partnership or a corporation with shareholders may have many “owners.” In the beginning, partners or shareholders typically see eye-to-eye on management styles, marketing, business operations, finances, or otherwise, but as time goes on and challenges to the business may arise, partners or shareholders could find themselves in disagreements about the future management of the business. Stresses at the management level can affect all facets of the business.
A good shareholder or partnership agreement at the start of the business formation process is an important tool to settling disputes before they ever arise, and could often save the business from closure or insolvency due to protracted legal battles and shareholder disputes. However, when disputes do arise, it is important to understand each parties’ rights and obligations to the business, protective procedures to take and build into the business structure, and negotiate or mediate any disputes that have arisen so as to keep the future of the business’ sustainability in the forefront.
At Schmeltzer & Bostic, we can assist you with the various issues that may arise while running your small business, including partnership and shareholder disputes, assistance in developing protective procedures into your business structure, helping you to understand the rights and duties of the partners or minority and majority shareholders, and negotiations to resolve disputes should they arise.