Ltd Company Woes
Discussion
3 of us set up a plc company in October 2022.
Had a very slow start and one of the other directors tried to do a quick bucks deal that went wrong resulting in us losing money. As a result, we had a fallout and he was asked to resign as a director which he did in January.
He originally had 45% of the shares and today we got an email saying that although he resigned as a director, it doesn’t affect his 45% ownership of the company and that that the confirmation statement we posted on companies house is invalid.
I’m obviously worried about this and wondered if anybody could give me some insight into this.
Not appointing noted an accountant yet as I wanted to keep costs at a minimum.
Tia for help
Had a very slow start and one of the other directors tried to do a quick bucks deal that went wrong resulting in us losing money. As a result, we had a fallout and he was asked to resign as a director which he did in January.
He originally had 45% of the shares and today we got an email saying that although he resigned as a director, it doesn’t affect his 45% ownership of the company and that that the confirmation statement we posted on companies house is invalid.
I’m obviously worried about this and wondered if anybody could give me some insight into this.
Not appointing noted an accountant yet as I wanted to keep costs at a minimum.
Tia for help
Easiest thing would be to close that business and start again, but not if it has assets or cash.
If you and other shareholder are in agreement you can effectively dilute him out by granting yourselves more shares in the company and playing silly games like that, so his position isn’t massively strong IMO, but he may think it is.
Buying him out is quick and easy if he’s reasonable.
Would need more details to work out best way fwd, but whatever- sort this sooner rather than later, more value in the business the worse the problem gets!
If you and other shareholder are in agreement you can effectively dilute him out by granting yourselves more shares in the company and playing silly games like that, so his position isn’t massively strong IMO, but he may think it is.
Buying him out is quick and easy if he’s reasonable.
Would need more details to work out best way fwd, but whatever- sort this sooner rather than later, more value in the business the worse the problem gets!
stuthe
said:
said: Easiest thing would be to close that business and start again, but not if it has assets or cash.
If you and other shareholder are in agreement you can effectively dilute him out by granting yourselves more shares in the company and playing silly games like that, so his position isn’t massively strong IMO, but he may think it is.
Buying him out is quick and easy if he’s reasonable.
Would need more details to work out best way fwd, but whatever- sort this sooner rather than later, more value in the business the worse the problem gets!
Yep or B shares which are entitled to a dividend and not the A shares etcIf you and other shareholder are in agreement you can effectively dilute him out by granting yourselves more shares in the company and playing silly games like that, so his position isn’t massively strong IMO, but he may think it is.
Buying him out is quick and easy if he’s reasonable.
Would need more details to work out best way fwd, but whatever- sort this sooner rather than later, more value in the business the worse the problem gets!
stuthe said:
said: Easiest thing would be to close that business and start again, but not if it has assets or cash.
If you and other shareholder are in agreement you can effectively dilute him out by granting yourselves more shares in the company and playing silly games like that, so his position isn’t massively strong IMO, but he may think it is.
Incredibly bad advice I'm afraid. Anything done to impact the shareholders 45% shareholding would cause massive issues if it is taken down the legal route.If you and other shareholder are in agreement you can effectively dilute him out by granting yourselves more shares in the company and playing silly games like that, so his position isn’t massively strong IMO, but he may think it is.
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