What happens to your shares if you get divorced? What happens to your company and your stock if you pass away? What if you become ill or incapacitated? Will the shareholders buy and sell the shares or will the shares go to your next of kin?
As a shareholder in a small or family-owned business, it is important to plan for the future today. Without an agreement in place, a divorce could result in your ex-spouse owning 50 percent of your shares. The death of a fellow shareholder could result in his or her parents, children or spouse taking an active role in running the business.
At Jacobs & Dodds, we can advise you on your options and help you protect your business interests. We have more than 30 years of experience providing guidance to small-business owners in California.
For answers to your questions about the issues that affect your business, now and in anticipation of the future, contact an experienced Orange County shareholder agreement lawyer at our law firm. We offer free initial consultations.
Lawyers Drafting Buy/Sell Agreements in Irvine
In California, shareholder agreements are often referred to as buy/sell agreements. This is because they outline the circumstances in which shares will be bought and sold between shareholders. Without this type of agreement, a shareholder's share will become subject to the laws of divorce or probate.
For example, California is a community property state. If a shareholder with a 50 percent interest gets a divorce, his or her spouse will own 25 percent of the shares and be entitled to 25 percent of the profits from the business every year. This may not be the result you and your partner intended when you started the business.
A shareholder agreement, which must be signed by the spouse to be effective, can give you greater control over the future of your business. In addition to providing direction in a divorce, the shareholder agreement can also cover death, illness, incapacitation and other unexpected events.
Contact Our Attorneys
Contact Jacobs & Dodds for a free consultation with an experienced business law and transactions attorney or to speak with an experienced Orange County, California, trial lawyer from our business litigation firm.
Free initial consultations • Phone calls always free • Extensive trial experience • Located next to John Wayne-Orange County Airport