minority owner legal rights

As a minority owner of a company, what are my rights as far as keeping my ownership status once the majority owner has decided that he dont want to me to be part of the company even though my intentions are to stay working for the company as a minority owner.

Asked on February 15, 2019 under Business Law, Texas

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 1 year ago | Contributor

You can't be made to give up your ownership interest unless there is some written contract or agreement (like an operating agreement) requiring you to give up or sell back, etc. your interest under certain circumstances and those circumstances apply. Otherwise, owning part of a company is like co- or jointly owning a car or a home: it is your property, and you can't be made to give it up to other owners.
The majority owner can make you a passive investor or owner: he can use his majority control to deny you any managerial or operational role. But he can't take your ownership away, and you will be entitled to your share of any dividends, distributions, or proceeds from the sale of the company.


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