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What the Florida statutes say about shareholder agreements

In business, a dispute between owners may be devastating to the company. Although mediation, arbitration and litigation are three ways people attempt to resolve their issues to their own satisfaction, some problems may be avoided through a successful shareholder agreement. We at Welbaum Guernsey are familiar with the state laws that govern these documents, and often provide advice to those seeking to create such an agreement.

To be authorized by law, Florida statutes state that a shareholder agreement requires the approval and signature of all of the corporation’s current shareholders. This could be written at any time, although it may be included in the bylaws or articles of incorporation at the founding of the company. A corporation that has not yet issued shares may still have a shareholder agreement created by those who incorporate the company. The document may later be amended if the current shareholders are all in accord about the change. Provisions may be included that allow exceptions.

A person who buys shares has the right to be informed of any shareholder agreement, and this information may be included on the statement or certificate received before or at the time of the purchase. Otherwise, he or she has the right to cancel the purchase.

The shareholder agreement may be ended or may be deemed ineffective only under certain circumstances. For example, all the shareholders might approve of the decision to terminate it. Or, it may no longer be effective if the corporation’s shares are listed on a securities exchange registered with the U.S. Securities and Exchange Commission. For more information about business transactions, please visit our web page.

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