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Alex J.
Alex J., Solicitor
Category: Law
Satisfied Customers: 3775
Experience:  Solicitors 2 years plus PQE
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I am currently one of 3 directors in a railway construction

Resolved Question:

hi
I am currently one of 3 directors in a railway construction company ,
I am thinking of resigning and pursuing other projects , I recently put in 36 k ,to help the cash flow ,we have rolling contracts & have just signed a 2 year contract worth 800k ,
how do I estimate a fair figure for them to buy me out ?
thank you Gary
Submitted: 2 years ago.
Category: Law
Expert:  Alex J. replied 2 years ago.
Hi,
Thank you for your question and welcome.
My name is ***** ***** I will assist you.
Do you have a shareholders agreement?
How many shares do you own?
Is the £36k listed as a debt in the company accounts?
Does the company have any assets?
Kind regards
AJ
Customer: replied 2 years ago.

Hi,

unfortunately I have limited information regarding the accounts and will have to confirm how the £36K has being registered. I believe we have a share holders agreement with each of us having 33 shares.

In terms of assets we have 2 vans which are approximately around 5 years old, the usual office equipment 8 desktops, 8 laptops, printer/scanners.

regards

Gary

Expert:  Alex J. replied 2 years ago.
Hi,
Thank you.
The first point to consider is:
1. Do you want to just agree one settlement figure to leave in respect of all claims; or
2. Do you want your £36k back and then be paid a further sum for your shares?
What you have to accept is if the company has cash flow problems what ever you are paid either for your shares or repayment of the £36k (assuming it is a loan and not share capital) it will likely be in installments - therefore I would insist at the very least the company gives a debenture as security for the money you are owed until you are repaid in full.
In terms of valuing it the fairest way is to go to the company account and agree with him a set of principles on which all the company shares will be valued. If your £36k is a loan then this obviously devalues the company's net assets and therefore you have to decide with the others whether you want to include this as part of the valuation?
I look forward to hearing from you.
Kind regards
AJ
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