Shareholder, Unitholder and Partnership Agreements

We provide business structuring advice and prepare shareholder's agreements, unitholder's agreements and partnership agreements for clients in the Sutherland Shire and greater Sydney area. 

 

Having a shareholder, unitholder, or partnership agreement in place for your company, unit trust, or business partnership is an important step for any new business, whether new or existing. These agreements play a pivotal role in governing the dynamics between involved parties both during the course of their business relationship and in the event of its termination.

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Shareholder, unitholder, or partnership agreements establish the groundwork for decision-making processes within the business or company and sets rules for a business partner's departure, whether voluntary or involuntary. Their terms not only mitigates the potential for conflicts but also reduces associated costs and uncertainties for all parties involved.

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Although ideally established at the onset of your business relationship, these agreements can also be executed at later stages of the business lifecycle.

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Your shareholder or unitholder agreement should include terms about:

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• The shareholders or unitholders rights to appoint directors to the company;

• The types of decisions that can be made by directors and whether those decisions must be made unanimously, by majority vote or individually;

• The types of decisions that can be made by shareholders or unitholders and whether those decisions must be made unanimously or by majority vote;

• Paying capital into the company or providing a shareholder loan;

• The process for selling and purchasing shares in the company or units in the trust, including how the shares or units may be valued;

• Restrictions on transferring shares or units to third parties;

• The transfer of shares or units on the death of a shareholder, unitholder or a key person of a corporate shareholder/unitholder;

• Non-compete and non-solicitation restraints applicable to the company directors and/or shareholders/unitholders;

• Confidentiality obligations; and

• Dispute resolution procedures.

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Your partnership agreement should include terms about:

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• How the profits and losses from the business will be shared;

• The role and responsibilities of each partner;

• Daily management issues for the business, such as payment for expenses, accounting records, insurance and employment matters;

• Admitting new partners into the partnership;

• Removing partners from the partnership;

• Whether assets brought in by each person are individual assets or assets of the partnership;

• How a partner may exit the partnership; and

• Dispute resolution procedures.

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Call or email us today to discuss your business structuring needs, and download our Business Legal Essentials Guide.