Business Divorce

If you are a business owner or a stockholder, understanding the concept of a business divorce is crucial. Like a marital divorce, a business divorce is, in essence, the separation of the shareholders or partners and the liquidation of business assets. Your rights as a business owner vary depending on the type of company you have as well as the agreements in place that you have governing the operation of your company. It is critical that you are familiar with your rights as a business owner or shareholder.

At Freundlich & Littman, LLC, we want to preserve your rights whether you are a partner or minority shareholder. A business divorce is often contentious and can last for long periods of time. At the first sign of trouble, give us a call. We work hard to defend our client’s rights.

Majority vs. Minority

Some businesses give employees a share of the stock or a stock option when joining the company. The stock option needs to mature for a period of years before the shareholder realizes its full value. It is an incentive to join the company and stay while the stock matures. Once the majority fires a minority shareholder, the company then sells the stock. Likewise, the company may offer a financial offer if the stock option plan has yet to fully mature. These offers tend to be a pittance in comparison to the full fair market value of a matured stock.

Essentially, the majority hits the minority “where it hurts.” They will not-so-gently push someone into retirement. The majority may assign a minority shareholder to another division to induce quitting. They may also take away certain perks or demote the individual. Once the employee has left, the majority is free to buy the shares.

Via mail or in an email, you may have received notification that a vote has taken place to change minority voting rights. The majority, often just a few shareholders, will overrule the minority interests in an attempt to push out the minority. They are hoping to overthrow the minority to gain control.

If you feel you are being pushed out of your minority control, you have options and our attorneys can help. Contact us today to ensure you are able to maintain your shares and your rights as a shareholder.

Act Immediately

We at Freundlich & Littman are capable and willing to take a look at your rights. If you received a notification that threatens your company shares, do not hesitate to contact us today. We service the greater Philadelphia area’s businesses. If you fear the majority shareholders are attempting to push out the minority shareholders, we can circumvent the majority shareholders on your behalf. Do not let the majority affect your rights as a minority shareholder. Contact us today to schedule a free consultation.