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I am a class B shareholder in a business... I own 50% equity. Can I open another business on my own? And If the class A shareholder votes me out of the company, do they have to give me my equity back or can they hold on to it till they sell the business?


Asked over 5 years ago in Edmonton, Alberta
Categories: Business Law

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Katherine MacRae

Answer by Katherine MacRae

VerifiedAlberta lawyer


Unless the company you start is in the same business as the existing company AND you signed a non competition agreement, you can start a new company.
 
A shareholder cannot be "voted out" of the company as a shareholder.  If you have a unanimous shareholder agreement, it may govern a buy back of your shares, but otherwise, you have shareholder rights, whether or not your Class "B" Shares are voting shares.

Posted over 5 years ago

Please note that this is for informational purposes only and does not constitute legal advice to you. Legal advice pertaining to your particular situation can only be provided by a lawyer who has met with you to obtain all pertinent background information necessary to give you a formal legal opinion. For formal legal advice, hire a lawyer (many give a free first consultation). Contact Katherine MacRae, or search the Lawyer Directory.


Comment

<br />Even if this person has 100 voting rights and&nbsp;I have none? <br />We never signed a competition agreement... but there is something listed in the articles of incorporation, and it states: If the corporation is restricted from carrying on a certain business,or restricted to carrying on a certain business, specify the restriction(s):&nbsp; and under that it says None. What does that mean exactly? Does that have anything to do with me opening another business of the same?

Posted over 5 years ago

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