Manu Inc. (\"Manu\") is a specialized manufacturing corp that has been in busine

Question

Manu Inc. ("Manu") is a specialized manufacturing corp that has been in business for 22 years. Walter and Jane Smith, husband and wife, founded the business and own 60 percent of Manu's outstanding common stock. They are Manu's only directors. Manu has always been profitable. Walter annually draws a salary and bonuses totaling 400k to 500k.

Manu has had 4 executive employees, including Linda, for many years. APproximately 5 yrs ago, they were each granted as additional compensation, 10% of Manu's outstanding common stock. Historically, they have each annually been paid a salary and bonus equal to 180k to 210k. There has never been a shareholder buy-sell agreement between Manu and its stockholders.

Seven months ago, Walter and Linda had a major falling out over the termination of a junior employee. Linda wailed in protest until Walter finally exclaimed, "that's it, Linda. I've had it w/ you and your complaining. You are now finished. I can't put up with you any longer" Linda was instantly terminated. She was paid 6 months of severance pursuant to a simple employment agreement.

After cooling off for a month, Linda sent Walter an email requesting that either Manu or Walter buy her Manu stock. Walter's respond was curt: "Manu doesn't need your stock. I don't want your stock. No one else will want to buy your stock. There is no market for the stock. I don't want your stock. No one else will want to buy your stock. There is no market for the stock, and there never will be. Manu has never paid a dividend and never will. As you well know, Manu pays its earnings to the team that makes it happen here. Because of your intolerable complaining, you are no longer part of that team. Thus, you should not expect any return on the Manu stock that you were given years ago."

Linda wants to know if she has any rights as a minority shareholder in this situation. What additional facts would you like to have? In a legal proceeding, how should the issues and allegations be framed on behalf of Linda? What standard of review should the court use?

Explanation / Answer

first of all no one can force minority share to sell the share or not to sell their shares.

she is also received minimum notice period for the ending of her job.she cannot be terminated immediately.She can also write a simple dispute resolutions to help resolve any deadlock situations.

well while receiving shares every has wriiten statement in which all related aspects of shares will be mentioned on leaving the job.

Your company's AOA specifies that your shares must be bought back by company or your contract may have a " buy back" clause. this will explain whether the company or another person will buy back the shares and hoe theshares will valued at the time of buy back.

if the buy back is not specified and you have not sold the shares, you will keep the shares on leaving and continue to gain from related rights and be restricted by any restriction attached to that shares.

If any of the shareholder rights are voilated they can bring lawsuits against their corporations. court can enforce the right of shareholder if corporation are in the wrong track. they should seek legal coucel as well check their local government agencies for more information

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