When ownership of a business enterprise find themselves in disagreement on many business issues, the ability of the business to survive is often threatened. Disagreements between owners which prevent the business enterprise from properly functioning is known as “deadlock”.
When deadlock exists between the owners of companies there are a number of options including the wind-up and dissolution of the business enterprise. However, dissolution and windup of a business enterprise does not always make good business sense and may not be in the best interests of the business owners. In these circumstances, seeking the court’s assistance in the appointment of an interim director may be the most appropriate course of action.
An interim director is appointed by Court order or upon an agreement by the factions of ownership who are in disagreement. The interim director will be called upon to attend board meetings (and in the case of limited liability companies, members meetings) and in the event there is a disagreement on what non-ordinary course of business decision is to be made the interim director will cast the deciding vote.
Given the importance of the decision-making role of an interim director, it is important that the integrity, experience and qualifications of the selected interim director be carefully reviewed. Equitable Transitions, Inc. has a well experienced team of professionals who are well qualified and capable of serving as the interim director for business entities suffering from ownership deadlock.