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Alex J.
Alex J., Solicitor
Category: Law
Satisfied Customers: 3840
Experience:  Solicitors 2 years plus PQE
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I have recently separated from my partner who was also

Customer Question

Hi, I have recently separated from my partner who was also my business partner. She has verbally agreed to sell her 50% share of the company to me and also have her name taken off companies house. Is there a legal document I can use to detail our agreement, which we can both sign, so that there can be no change of conditions at a later date?
Any advice would be much appreciated.
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. Formally speaking to transfer shares she just needs to sign a stock transfer form (called a CON40G) and you need to pay stamp duty on the shares if you are paying over £1000 for them. If you want to record the arrangement as a financial settlement then you will also need to sign a share purchase agreement, confirm that the shares are in full and final settlement of any claim she may have against you. How much are you paying as a starting point? Kind regards AJ
Customer: replied 2 years ago.
Hi Alex, thank you for getting back to me so quickly! We haven't agreed a settlement figure as we are going to get the business valued by our accountant and whatever the business is valued at, taking into account our debts etc I will purchase her 50% share.We think the business is worth around £30-40K. By my rough estimations the business is currently £40K in debt. How will this work in terms of her share? It might work out the her 50% share has a negative value?She did leave the business back in September and has since started working for another company (not sure if that makes any difference as to her rights as a director).Thanks
Expert:  Alex J. replied 2 years ago.
Hi, Thank you. She cannot be held personally liable for the company debts unless she guarantees them - if the shares have little to no value due to the company debts then she could just sell them to you for £1. I doubt they will have no value because even with debt the business is still a going concern - does it make a profit?
Customer: replied 2 years ago.
Hi, Yes it makes between 5 to 10K per year, on paper anyway.
Expert:  Alex J. replied 2 years ago.
Hi, Thank you. The business probably does have some small value, but it sounds like the shares will not be valued highly. You could always sell it to her in such a way to say that in return for the shares you are taking off her any future statutory obligation and any responsibility for management of the company. Kind regards AJ