Regaining Money and leaving

[Encryption]

Hello,

I am in need of advice. I naively went into business with 3 other directors / colleagues. I was set the task to handle the front end, which is quite successful.

However I have gone into the business with no common sense, I know it is a stupid thing to do! But lets move forward

I personally put around £5000+ into the company, long story short. I want to leave. I own 24.5% I was told by the our finance team that that if I put it into the business as a Directors Loan it could be paid back as a "Long Term Plan" this would remove the need to take out a bank loan.

As I want to leave, as soon as possible. Can I sell my shares and reclaim my invested money? With ease.

I have limited business knowledge and realise that this got in my situation. Is there any advice I can proceed with?

Many thanks,

 

[Lancelot]

You can sell your shares but bear in mind that they are shares in an unquoted business and it may not be as easy to as it seems to sell them because there is no active market.

Offer the shares to the other shareholders or ask the company to buy them back.

Bear in mind that there may be capital tax implications.

 

[Encryption]

Thanks for the advice. Is there any legal implications of selling my share (specific paperwork; other directors consent/signature). Also am I able to sell my shares of a custom choice.

Or

Am I able to become a silent partner, with my shares being the ONLY involvement. If I am a silent partner is it hard to implement?

Ideas guys / girls?

Thanks

 

[Lancelot]

You can do both.

If you sell the shares you are doing it on a free market so you and the other part are free to set the price. No consent from other directors is required because the shares are your property and you are free to do whatever you wish with them.

You don't need to be actively involved in the business. You just go to AGMs and get your dividend. You should also make arrangements over the repayment of the loan to you as soon as possible.

 

[GGGSurrey]

No consent from other directors is required because the shares are your property and you are free to do whatever you wish with them.

Unless a shareholder's agreement says otherwise...

 

[JulianHobbs]

It is possible that the legal paperwok, shareholders agreement in particular, contains a precise procedure for when a shareholder wants to exit the business (for example the share must be offered to existing shareholders before being sold externally). The shareholders agreement can also contain guidance on how the shares being sold are to be valued.

Therefore, thoroughly check the legal documents, including any shareholders agreement and articles of assocation to check for provisions surrounding the procedue of when a shareholder wants to dispose of his shares.

Julian Hobbs,
Chartered Accountant
www.julianhobbs.com

 

[Encryption]

Much appreciated for the help.

On return to the company headquarters I have found that quotes from my finance director, that is is illegal to "Remove the shares agreement from the building", with your advice I believe this to be a lie.

I plan to leave the company soon, however without any physical documentation in my hand (share documents). I am unsure of what my following tactical moves are. With only a signature on my business bank card, I have now got doubts whether I have any shares, (due to me needing to sign a shares document initially, would it not?).

If I decide to announce my resignation leave from the board at our AGM can I pursue any legal avenues? I have thoughts that I may in an intentional situation, forces upon from day one (nov 2010)....

--------------------

Why isn't business simple nowadays, as usual thanks for the fast response.

 

[Lancelot]

By the looks of it, the situation is quite complex. I would recommend that you get some advice from a solicitor.

 

[BobBuilder]

............illegal to "Remove the shares agreement from the building", with your advice I believe this to be a lie.

But academic if you have a photocopier or a camera