Our client is a private company with three shareholders all of whom are either directors or employees of the company. Two of the shareholders A and B hold 40% of the shares each and the remaining 20% is held by the third C. The split of capital reflects the shareholders’ original capital contributions but two years ago the shareholders agreed that they would share equally in the proceeds of selling the company. The shareholders have been approached by prospective purchasers twice over the last year and are now giving serious thought to actively marketing the company but need to consider how best to deal with the promise made to C.
All of the shareholders are directors or employees of the company which issued...
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