DeveloperBloke
25th February 2009, 21:04
Hi there
I am after some advice please.
we have spent 4 years developing some software. last year we received investment from a company
They are the major share holder in our business . hindsight is an amazing thing and we realise now that they were not what they said they were, basically lied during the investment talks and could not deliver on nearly all areas they were responsible for.
on the board is myself, my two business partners and two directors from the company that invested in us. they are an established sales and training company. We are a software development company. We are all full directors (not non exec or other types)
Their accountant also manages our company accounts.
We requested accounts to be sent to us for January. We receive a management charge of about 1500 a month. For january, this has been increased to 72k!!, more for February!!
we called their accountant and have asked what this is for, and he says that the cost of th sales people has been moved from the sales and training company into our technology company! This has never been approved by us the directors at a board meeting, or even discussed. One of their directors on our board simply decided to do this!
is this legal? wouldnt something like this have to be first be discussed at the board level, then voted on? we would ever agree to move this cost into our business, this 72k has meant that we had a 40k loss for February! we have a pretty good turnover and because we only have a staff of four, very low overheads. we have also got a lot of clients using our software so we have an excellent net profit each month. well we did anyhow!
this has left me and my two business partners bemused, untrusting and absolutely livid! being that there is 5 directors, two of thier people, and me and my two business partners, are we able to vote against decisions like this? can we vote them off the board? we are amazed that this has been done as without me and my two business partners, there is no business! do their directors have the power to pass decisions without consulting the board, or us?
I would be extremely grateful for any advice on this matter, this has left us extremely worried , potentially destroying our business which we have all spent 4 years working very hard to get it where it is.
many thanks
Dev bloke
I am after some advice please.
we have spent 4 years developing some software. last year we received investment from a company
They are the major share holder in our business . hindsight is an amazing thing and we realise now that they were not what they said they were, basically lied during the investment talks and could not deliver on nearly all areas they were responsible for.
on the board is myself, my two business partners and two directors from the company that invested in us. they are an established sales and training company. We are a software development company. We are all full directors (not non exec or other types)
Their accountant also manages our company accounts.
We requested accounts to be sent to us for January. We receive a management charge of about 1500 a month. For january, this has been increased to 72k!!, more for February!!
we called their accountant and have asked what this is for, and he says that the cost of th sales people has been moved from the sales and training company into our technology company! This has never been approved by us the directors at a board meeting, or even discussed. One of their directors on our board simply decided to do this!
is this legal? wouldnt something like this have to be first be discussed at the board level, then voted on? we would ever agree to move this cost into our business, this 72k has meant that we had a 40k loss for February! we have a pretty good turnover and because we only have a staff of four, very low overheads. we have also got a lot of clients using our software so we have an excellent net profit each month. well we did anyhow!
this has left me and my two business partners bemused, untrusting and absolutely livid! being that there is 5 directors, two of thier people, and me and my two business partners, are we able to vote against decisions like this? can we vote them off the board? we are amazed that this has been done as without me and my two business partners, there is no business! do their directors have the power to pass decisions without consulting the board, or us?
I would be extremely grateful for any advice on this matter, this has left us extremely worried , potentially destroying our business which we have all spent 4 years working very hard to get it where it is.
many thanks
Dev bloke