How JustAnswer Works:

  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.

Ask Alex J. Your Own Question

Alex J.
Alex J., Solicitor
Category: Law
Satisfied Customers: 3497
Experience:  Solicitors 2 years plus PQE
13113900
Type Your Law Question Here...
Alex J. is online now

Hi, I have a Ltd company that failed to raise the money it

Customer Question

Hi, I have a Ltd company that failed to raise the money it needed to industrialise. This has meant we have had to go out of production and liquidate all assets. We now have no liabilities and a positive cash balance. I wish to close the company down, distribute the cash and move on the majority share holder wants to keep it in hibernation but do nothing proactive with it. We are in stalemate, what do we do?
Submitted: 2 years ago.
Category: Law
Expert:  Alex J. replied 2 years ago.
Hi,

Thank you for your question and welcome.

My name is AJ and I will assist you.

Do you have a shareholders agreement?

Kind regards

AJ
Customer: replied 2 years ago.

yes but there does not seem to be anything definitive

Expert:  Alex J. replied 2 years ago.
Hi,

Thank you.

So the SHA does not have any deadlock provisions etc? Does the SHA have any provisions for the sale of shares e.g transfer notices?

Normally what you would do is either liquidate the company and distribute the cash or declare what is known as a dividend "in specie" and distribute the company assets.

In the circumstance if the company is deadlocked you can either:
1. Try and agree a deal for him to buy your shares:
2. Apply to court for an order to have the company liquidated/dissolved on the basis that this is a partnership that has terminated.

I look forward to hearing from you with more details of the SHA.

Kind regards

AJ
Customer: replied 2 years ago.

There is no deadlock provision.


 


There is a transfer agreement but simply agreeing not to sell or offer to sell shares for 3 years. If there is a sale above 50%, a drag along clause.


 


How do I apply to the court for the company to be dissolved?


 


thanks

Expert:  Alex J. replied 2 years ago.
Hi,

Thank you.

Does the shareholders agreement contain a clause that says "No Partnership"?

If the company is made dormant will it do any damage to the value to the assets?

Kind regards

AJ
Customer: replied 2 years ago.

there is no no partnership clause


 


Yes we have a time limit on our IP, many people are trying to do what we have achieved and it's only a matter of time until somebody does. I want to break free and carry on. I see a very limited time window to be able to do this.

Expert:  Alex J. replied 2 years ago.
Hi,

The grounds for a winding up petition are under S.122 of the Insolvency Act 1986.

The court has a wide discretion to grant a winding up order. The applicable grounds may be under subsection 1(d) if the company has suspended its business.

You would need to apply to the company courts for the court to make such an order.

I look forward to hearing from you.

Kind regards

AJ
Customer: replied 2 years ago.

do you have any idea what something like this would cost


 

Expert:  Alex J. replied 2 years ago.
Hi

Thank you.

The application would probably cost £1-£2k if you used a solicitor.

If it is essentialy that you used the IP have you considered seeing if he will agree to you licensing the IP to a new company then trading with that company alone?

Kind regards

AJ
Customer: replied 2 years ago.

I will try this approach but feel that this is now not possible given the break down in communication.


 


Thank you for you information.


 


Regards


 

Expert:  Alex J. replied 2 years ago.
Hi,

No problem.

I am happy to discuss any of these points further if you wish?

I wish you the best of luck.

Kind regards

AJ
Customer: replied 2 years ago.

I have to face up to the reality of applying to the courts for a winding up petition is the only way forward. I will make one last attempt at trying to resolve a better settlement but I am not hopeful. If i need help to take this forward what do I do?

Expert:  Alex J. replied 2 years ago.
Hi,

Thank you.

If you want to make the claim yourself then you need to file the claim at the Companies Court using a form N1. You will need to prepare a witness statement and collate all your evidence.

The alternative is to use a solicitor. If you contact the the Law Society www.lawsociety.org.uk they will be able to recommend one that deals with company disputes.

It has to be worth trying to get a licence agreed, as far as the other shareholder is concerned it will be money for old rope and will stop the assets going to waste.

Kind regards

AJ

What Customers are Saying:

 
 
 
  • Thank you so much for your help. Your answers were really useful and came back so quickly. Great! Maggie
< Previous | Next >
  • Thank you so much for your help. Your answers were really useful and came back so quickly. Great! Maggie
  • A quick response, a succinct and helpful answer in simple English. I believe I can now confront the counter party with confidence -- worth the 30 bucks! Rick
  • Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help. Mary C.
  • This expert is wonderful. They truly know what they are talking about, and they actually care about you. They really helped put my nerves at ease. Thank you so much!!!! Alex
  • Thank you for all your help. It is nice to know that this service is here for people like myself, who need answers fast and are not sure who to consult. GP
  • I couldn't be more satisfied! This is the site I will always come to when I need a second opinion. Justin
  • Just let me say that this encounter has been entirely professional and most helpful. I liked that I could ask additional questions and get answered in a very short turn around. Esther
 
 
 

Meet The Experts:

 
 
 
  • Jo C.

    Jo C.

    Barrister

    Satisfied Customers:

    30316
    Over 5 years in practice
< Last | Next >
  • http://ww2.justanswer.com/uploads/EM/emus/2015-7-7_192327_bigstockportraitofconfidentfemale.64x64.jpg Jo C.'s Avatar

    Jo C.

    Barrister

    Satisfied Customers:

    30316
    Over 5 years in practice
  • http://ww2.justanswer.com/uploads/BE/benjones/2015-12-1_0437_ennew.64x64.jpg Ben Jones's Avatar

    Ben Jones

    UK Lawyer

    Satisfied Customers:

    11553
    Qualified Solicitor - Please start your question with 'For Ben Jones'
  • http://ww2.justanswer.com/uploads/BU/Buachaill/2012-5-25_211156_barrister5.64x64.jpg Buachaill's Avatar

    Buachaill

    Barrister

    Satisfied Customers:

    1754
    Barrister 17 years experience
  • http://ww2.justanswer.com/uploads/JO/jojobi/2013-3-19_0265_maxlowryphoto.64x64.jpg Max Lowry's Avatar

    Max Lowry

    Advocate

    Satisfied Customers:

    894
    LLB, 10 years post qualification experience
  • http://ww2.justanswer.com/uploads/UK/UKLawyer/2012-4-12_9849_F2.64x64.jpg UK_Lawyer's Avatar

    UK_Lawyer

    Solicitor

    Satisfied Customers:

    750
    I am a qualified solicitor and an expert in UK law.
  • http://ww2.justanswer.com/uploads/KA/Kasare/kasare.64x64.jpg Kasare's Avatar

    Kasare

    Solicitor

    Satisfied Customers:

    402
    Solicitor, 10 yrs plus experience in civil litigation, employment and family law
  • http://ww2.justanswer.com/uploads/OS/osh/2015-7-7_19268_gettyimagesb.64x64.jpg Joshua's Avatar

    Joshua

    Lawyer

    Satisfied Customers:

    8199
    LL.B (Hons), Higher Prof. Dip. Law & Practice