Legal Question in Business Law in Pennsylvania

Re: S Corp

You asked about acquisition of a company.

This is a relatively common situation and depending on your circumstance you should consider engaging counsel for a fight. There are circumstances where an acquirer can treat minority shareholders negatively. As well there are circumstances where such actions would be impermissible. Only you can determine whether it is in your best interest to take this fight on by yourself or with other minority shareholders.

Do not go this fight alone.

Regards,

Roger

Re: S Corp

This is a fairly complicated question, but I will try to give you some general parameters. First of all, if you have a Close Corporation Agreement or a Buy-Sell, it probably places some restrictions on selling shares to outsiders that you should familiarize youself with. If you don't have that, then this group can at least buy the 51% interest. As far as forcing the minority shareholders out, if this is a corporation with a smallish number of shareholders, they would have a "fiduciary duty" not to behave in this sort of way. I've written about this in a slightly different context in my Ohio Practical Business Law blog at http://www.ohiopracticalbusinesslaw.com/2007/12/articles/corporate/the-ugly-truth-about-giving-others-especially-employees-a-piece-of-your-business/

In addition, minority shareholders have "dissenter's rights" concerning the valuation of their shares which helps protect them. In most cases, no one can make you sell out unless you want to do so.

As far as the details on all this, you would do best to contact an attorney and discuss the specifics of your particular situation.