If a limited company has two directors and a shareholder, can the shareholder get the directors to buy him out

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G A

If a limited company has two directors and a shareholder, can the shareholder get the directors to buy him out

Huh?

You need to look at the shareholders, operators agreement or the by-laws of the company. Which ever document the company uses, it should have been created when the company was formed and address the buyout of a shareholder.

Abi F

simple answer: no

explaination: you've not specified what you mean very well however in a limited company the directors cannot carry out any decisions without the shareholders permission, this doesn't necessarily mean that the shareholder is "incharge" of the business, they can only buy the shareholder out IF the directers decide that this is the best option for the company AND the shareholder agrees to it, the shareholder cannot tell them to do that......

and you can't do the above because it counts as unfair dismissal which could lead to being sued

ottomangeek

Yes, if the director agrees with it.

RAY

I don't think you can 'force' them to, but if you're talking about a sole or even majority shareholder surely you can sack the directors at the next AGM and elect two who will. Therefore if they don't want that to happen they don't really have any choice but to buy him out do they ?

Edit:
In response to the answer below... removal of a director by a majority of shareholders is NOT unfair dismissal .. you have to comply with certain rules and they are entitled to any pay-offs they may be entitled to under any service agreement... but that's it. No unfair dismissal rules apply purely for removing them as a director... in the UK refer to sections 303(2) and 379 of the Companies Act 1985 etc

Acka

A Management buyout?

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