[Lime One]

If you look on Google for most common causes of disputes in business you will see partnership and directors falling out the most common causes.

Without clear written agreements in place from the start if a fall out happens, not even a big one just a difference in direction is enough, then investment, sale of the business and operations just come to a grinding halt.

I am in the process of finalising a number of articles and these will be placed on our site. As that takes a bit of time if anyone wants to read

Business divorce- no partnership agreement

What happens to your shares if you want to move on

Just email me via the site and I will send them over to you. We are always looking for new titles, so let me know if anything worries you and you'd like some free info in an article.

[IP2]

I have some great partners/ shareholders in my business operations and things are generally as watertight as they can be from the outset, I explain what I expect, they tell me what they want and then we work on the common ground and find a way through any possible misunderstandings.

Any business relationship can be fraught with disaster if you don't have a clear understanding from the start. I suspect LimeOne is perfectly geared to help those that have made common mistakes, but by being clear from the outset, you could save yourself a lot of agro!

[Indizine]

People think it won't happen to them, and therein lies the problem.

[Jeewhizz]

Great thread, and great to have you on here

What about this scenario:

Person A buys a small share in Company A. Person B has the remainder of shares. Person B over a number of months/years then runs the company into the ground. Where does that leave Person A, and the value of their shares?

[Lime One]

Can you tell me the percentage of shares held and whether person A was also a director of the business?

[IP2]

Originally Posted by Jeewhizz

Great thread, and great to have you on here

What about this scenario:

Person A buys a small share in Company A. Person B has the remainder of shares. Person B over a number of months/years then runs the company into the ground. Where does that leave Person A, and the value of their shares?

If person A has less than 50% shares as it seems they would from your scenario, they are in a pretty week position of a Private Limited Company.

If Person B owns a majority of the shares or is in a position where they can control the majority of the voting structure, Person A's only angle would be to legally prove that Person B was not acting in the companies best interests (assuming he was also a Director). As a Director Person B would have a responsibility to act in the companies and the shareholders best interests, if he was simply a manager and a shareholder, action could be taken by the directors such as Person A to protect their interests under employment law.

My HO!

[Jeewhizz]

Originally Posted by Lime One

Can you tell me the percentage of shares held and whether person A was also a director of the business?

Let's assume 10%

I get a few offers each year from business colleagues to invest/partner in fledgling companies. I've always wondered what would happen in the above scenario!