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Ash
Ash, Solicitor
Category: Law
Satisfied Customers: 10916
Experience:  Solicitor with 5+ years experience
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Hi I am the sole director of a company and a minority shareholder.

Resolved Question:

Hi
I am the sole director of a company and a minority shareholder. The majority shareholder was meant to be a director but due to his financial issues we decided to go with the above set up. He is employed as a consultant to provide business development services. However he works part time at it! Despite my constantly discussing with him the need to put more effort in. I recently refused to pay for a business trip because we cannot afford the outlay, he has now questioned my stewardship of the company and now wants to see the accounts in full at short notice. The relationship is breaking down clearly can you advise how I manage the situation or extract myself from the business ?
Submitted: 3 years ago.
Category: Law
Expert:  Ash replied 3 years ago.

Alex Watts :

Hello my name is XXXXX XXXXX I will help you with this. Please note that I am a working Solicitor and may be on and offline as I have to attend Court and meet with clients, even at weekends. As such you may not get an instant response when you reply as this is not an ‘on demand’ live service, but rest assured I will be giving your question my immediate attention upon return. There is no need to wait here, you will get an email when I reply.

Alex Watts :

Is there a Shareholders agreement please?

Customer:

I wish I created one but he prevaricated and prevaricated over the agreement. i do have an email with some agreements.

Alex Watts :

What is it you want to be able to achieve please?

Customer:

Hi

Alex Watts :

I need to step out but will be online in 30 mins?

Customer:

Naturally I would like to make it work but I cannot be in a position of being bullied and controlled by the majority shareholder . So I suppose I am asking how to extract myself ? Also If I set the company up which I did. But didn't actually issue shares to the shareholder what is the position ?

Customer:

ok Thanks

Alex Watts : Have you valued the business please?
Customer:

no we are 6 months into business

Alex Watts : Ok. Do you want out or to stay?
Alex Watts : He can't just demand accounts, he can only have them once a year at The AGM
Alex Watts : Unless it was agreed otherwise he could.
Alex Watts : But then there is no shareholder agreement.
Customer:

I would like to stay but can't see how this would work my preference would be to remove him

Customer:

however I feel an exit is the ebts option unless I want a difficult situation

Alex Watts : What do the articles say about removal? Could you buy him out?
Customer:

no articles and no way i can buy him out

Alex Watts : Ok. So you want him out or you out?
Customer:

me out

Alex Watts : If that is the case you can resign as director. The company needs at least one Director so onesill
Alex Watts : so one will have to be appointed.
Alex Watts : What you need to do is tender your resignation to the shareholder.
Alex Watts : It is then for the company to seek and appoint another director.
Customer:

Hi

Customer:

Is it the responsibility of the majority shareholder or both shareholders ?

Customer:

Is it my responsibility to remove myself at companies house

Customer:

regards XXXXX XXXXX do share have to be literally issued to be valid

Alex Watts : Normally it would be in the articles.
Alex Watts : But you can resign and remove yourself from companies house.
Alex Watts : you don't need a physical share certificate for it to be valid.
Alex Watts : You can give up your shares if you wish.
Alex Watts : Can I clarify anything for you about this today please?
Customer:

many thanks

Ash, Solicitor
Category: Law
Satisfied Customers: 10916
Experience: Solicitor with 5+ years experience
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