A shareholders’ agreement at outset can avoid messy litigation later
A recent case underscores why it’s crucial to understand what each party’s expectations are and what pre-existing business relationships they bring to the table when drafting a shareholders’ agreement, Toronto business lawyer Anton Katz tells AdvocateDaily.com.
The Commercial List matter involved an applicant and two respondents who were founders and equal shareholders in a business. Prior to being dismissed by his two co-founders, the applicant was the primary point of contact for a client who represented more than half of the company’s revenue. This client grew out of a relationship he had developed over 14 years preceding the founding of the company.