Minority Stock Ownership
Posted by taxguru on February 1, 2006
Q:
Hi,
I was wondering if you could tell me what power I have as a 30% owner, with one other owner at 70%. The other owner is my father and he is not doing the job he should be doing as the President of the corp. Do I have any legal control or say in the operation of our business?
Please help!
A:
You will need to work with an attorney on this matter. S/he will need to see all of the documentation for the corporation and the issuance of the stock, including any governing documents that set out the legal and fiduciary responsibilities of shareholders and officers of the corporation.
If you don’t have any such written documentation, you may be SOL since anyone owning over 50% of a corp can usually run the show. You then have the choice of selling your shares, subject to any restrictions in the corporation’s governing documents.
Good luck.
Kerry Kerstetter
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