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Hi, Thank you for your question and welcome. My name is ***** ***** I will assist you. Can you confirm this is a limited company? Do you have a shareholders agreement?
Hi, this is a limited company and we do not have a shareholder agreement only the usual articles of the partnership and the docs required by Companies House
Hi, Thank you. Do you know whether the company was incorporated with Model Articles of Association? When was the company incorporated?
It was incorporated 30.09.2011 by the
MODEL ARTICLES FOR PRIVATE COMPANIES LIMITED BY SHARES.
Hi, Thank you. To answer your questions.
1. To pay out profits you need to declare a dividend and this can only be done by an ordinary resolution - which requires a 51% majority of the voting share capital;
2. All things being equal assuming there is no other agreement you could sell the shares to a third but no one is likely to by a 50% stake in a deadlocked company.
The other shareholder only under the model articles will not have pre emption on existing shares.
3. You would need a court order to force the dissolution. This would be on the basis that you have a partnership that has broken down.
What assets does the company have?
about 180.000 GBP
but what happens to the running costs, do I have the rights to cancel them right now? Those are about 15.000 GBP per month
Hi, Thank you. What are the running costs? If they are from contractual obligations you risk exposing the company to creditors?
actually those are freelancers, like designer and an editor that have freelance contracts that can be cancelled immediately
they are basically invoicing us every month for their services with no formal agreement
Hi, Thank you. Yes if you have access to the banking mandate you can insist that the company ceases trading until the dispute is resolved.
Is there any possibility he would buy you out?
I offered the company to him for 130.000 GBP and he refused
he offered me 5000 GBP for the company
Hi, Thank you. There are conceptual problems with suing him in the UK - they are not insurmountable - but you would need permission to serve him with proceedings in Canada.
ok, well I don't really want to do that. I want to dissolve the company in the UK
If he is not going to take you seriously or negotiate - you need to show him you are serious. I would contact the Law Society www.lawsociety.org.uk - ask for a solicitor who has expertise in company disputes.
I would then get the solicitor to write to him and insist he stop all commercial activity and that your limited company is merely a partnership asset and you want to dissolve the partnership and distribute the assets.
Ultimately if he see a letter from a solicitor he is far more likely to take negotiating seriously as it has the added gravitas that you have been advised.
ok, probably that is my only choice right now
I could also hire someone to manage the company on my behalf if it continues and we do not agree right?
It is not really that I want that, but I want to know all my options now
Yes, I would say so, you can get a court order forcing him to distribute the company assets and putting him on notice not to cause the company any more loss.
Hi, Thank you - yes you can hire someone to manage the company.
Shareholders do not have to be directors as well.
GReat thank you for your kind advice
have a nice day
Hi, No problem I wish you the best of luck. Kind regards AJ
Please do not hesitate to contact me if I can assist you any further.
No problem. Kind regards AJ