The answer is usually no, but there are vital exceptions.
Shareholders have an ownership interest in the company whose stock they own, and companies can’t generally take away that ownership. … The two most common are when a company gets acquired and when it has an agreement among shareholders calling for forced sales.
If you want to remove a shareholder, you first must decide if the shareholder is leaving the company voluntarily or involuntarily. For involuntary removals, the shareholder will usually need to have violated the shareholders agreement or company bylaws before they can be forced out of the company.
Shareholders who do not have control of the business can usually be fired by the controlling owners. … Although an at-will employee can basically be fired for any reason so long as it is not an illegal reason, having cause to fire a shareholder often helps solidify the business’ legal position.
When you leave, your stock options will often expire within 90 days of leaving the company. If you don’t exercise your options, you could lose them.
If you cannot resolve the disagreement with your minority shareholder, you may wish to remove them from the company. Unless there are specific rights to do so in your company’s shareholders agreement or constitution, you cannot simply take a shareholder’s shares from them.
Rights of shareholders possessing at least 50% of shares
Block ordinary resolutions – shareholders controlling at least 50% of voting rights can effectively block any proposed ordinary resolutions (s. 282).
How Can Majority Remove Minority Shareholders?
- Encouraging or forcing a share buyout at a discount price;
- Diluting the holder’s stock shares;
- Restricting the shareholder’s access to corporate records, financial information, or key business records;
- Discontinuing distributions to minority holders; and.
to attend and vote at general meetings of the company; to receive dividends if declared; to circulate a written resolution and any supporting statements; to require a general meeting of the shareholders be held; and.
Absent restrictions on the transfer of shares, a shareholder can withdraw from the business by selling or otherwise transferring his shares of stock. A corporation is managed by a board of directors who act on behalf of the shareholders.
No, the other 50% owner (who’s also an officer, and perhaps a director) can’t be fired, because he’s an owner just like you are. Check your Bylaws or any Shareholder’s agreement for how to resolve disputes.