David Herzog Legal

A share represents a shareholder’s ownership in a corporation. This can either be evidenced by a paper certificate or an entry in the corporation’s books.

Authorized shares are the number of shares your corporation is authorized to issue. You do not have to issue all of your authorized shares, and frequently it can be a mistake to do so. Authorized shares merely sit on the corporate books as shares available to issue. If you need to issue more shares than […]

Directors are the individuals who direct or guide the corporation with respect to its overall business model and, well, direction. The board sets policy and votes on major or extraordinary decisions. Shareholders elect directors, and directors elect officers. The “board” is the entirety of all of the directors.

A Shareholders Agreement, if written correctly, will a) limit each shareholder’s ability to transfer his/her/their/its shares in a corporation, b) provide for certain voting rights or limitations on voting rights, and c) give the corporation and each shareholder the option to purchase the shares of a deceased or withdrawing shareholder. Its purpose is to minimize […]

Well, without it, you could easily be engaged in litigation down the road. By way of example, without an agreement in place, the shares of a deceased shareholder will vest in that shareholder’s heirs, who will then be able to review the corporation’s books and vote. If that person doesn’t understand what’s best for the […]

Frequently a Buy-Sell Agreement is the name used for a Shareholders Agreement in a corporation. Sometimes, though, a Buy-Sell Agreement only refers to that part of a Shareholders Agreement that provides for the remaining shareholders to purchase a deceased or withdrawing shareholders’ shares. Though a solid first step, ideally your corporation would be protected by […]