Shareholders
In a corporate environment, a quick rule of thumb is that shareholders should not receive any "special" benefits without the inclusion of the employees in the firm. On the other hand, owning a corporation may provide the opportunity to plan your financial affairs differently than individuals who do not own a corporation.
Where several shareholders own a corporation, it is extremely important to have a shareholder agreement, that details what will happen in the event of disagreement, death, disability. Several types of structures are available in the form of buy-sell provisions and shareholders should take care to be aware of these options.
Shareholder agreements should be reviewed periodically to insure that they are still current and that subsequently developed legal documents do not create conflicting instruction.
Key Man
The term generally refers to the importance of an activity performed by an individual. Options are available to provide benefits to key persons in the firm. Often the firm will wish to take out life insurance on this individual to protect against financial loss in the event of his/her death. The key man may be a shareholder, but he may also be an employee with no share holding.
A complete review of the corporate and employment structure should be undertaken from time to time to protect the interests of all parties
