Corporate Law Breach of Fiduciary Duty?

[bfish]

We have an officer on our BOD that advised us in Dec. that he no longer wanted to be a part of our corporation, and gave us first right of refusal to purchase his stocks back from him, which we intend to do at our annual shareholders meeting on Feb. 9th. However, in the meantime, we've hit a growth in sales and need to hire employees to help. We have chosen 3 employees but are unable to bring them on board yet, because this officer is refusing to sign the Workers Compensation Exemption form, which has made it impossible for us to obtain the insurance. He states that he sees no benefit in him signing it, since he will no longer be a part of the corporation after Feb. 9th. However, this means we are not able to obtain the insurance need to bring these employees on board, and his failure to sign, means that we will now be forced to wait until our new SOI is filed, before we can even re-apply for Workers Compensation, as opposed to simply amending it after he leaves. My question is, given this information, and since he is still legally bound to act as the secretary of our board, can we sue him for Breach of Fiduciary duties?

 

[army judge]

We have an officer on our BOD that advised us in Dec. that he no longer wanted to be a part of our corporation, and gave us first right of refusal to purchase his stocks back from him, which we intend to do at our annual shareholders meeting on Feb. 9th. However, in the meantime, we've hit a growth in sales and need to hire employees to help. We have chosen 3 employees but are unable to bring them on board yet, because this officer is refusing to sign the Workers Compensation Exemption form, which has made it impossible for us to obtain the insurance. He states that he sees no benefit in him signing it, since he will no longer be a part of the corporation after Feb. 9th. However, this means we are not able to obtain the insurance need to bring these employees on board, and his failure to sign, means that we will now be forced to wait until our new SOI is filed, before we can even re-apply for Workers Compensation, as opposed to simply amending it after he leaves. My question is, given this information, and since he is still legally bound to act as the secretary of our board, can we sue him for Breach of Fiduciary duties?

You can sue him because you think he's too ugly.
That said, such a lawsuit would have no more of a chance than suing him because he won't sign off on WC.
Board members are independent and most of the time, a majority can over ride one or two rogues.
That said, you should be consulting with your firm's attorney about this.
Free internet advice is useless if you act on it and end up getting sued yourselves.

Consult your firm's attorney with your business questions.

 

[abc123thatsme]

Wow--no offense, but for a super moderator, that's a post without much value.

I suspect his position violates his agreement as a director, so you should make sure his position is clear in writing for the record. It does sound like you're in over your head and counsel is needed--don't save a penny to lose a dollar here.

Is there a strike price for your ROFR for the stock? If not, that's your next battle. Depending on personality, you might concede something in that battle in exchange for an expeditious signature on the form. Hope this helps!

 

[army judge]

Wow--no offense, but for a super moderator, that's a post without much value.

I suspect his position violates his agreement as a director, so you should make sure his position is clear in writing for the record. It does sound like you're in over your head and counsel is needed--don't save a penny to lose a dollar here.

Is there a strike price for your ROFR for the stock? If not, that's your next battle. Depending on personality, you might concede something in that battle in exchange for an expeditious signature on the form. Hope this helps!

Please don't flame other posters.
You are free to post your opinion, it's not necessary to comment on the opinions of others.
Finally, you're SERIALLY necroposting.
This is your only warning.
If you persist, punitive actions will be taken.

 

[abc123thatsme]

Well, you could have just suggested I look more carefully at the date of the post, which I will now do--and thanks for letting me know. Not sure immediately threatening me is the best route, but so be it.

I'll be more careful. I just found the threads interesting, but i now notice that you are correct and a number of them were old. They came up in my query for a topic I found interesting.

Happy to avoid commenting on other's posts as well.

Oops. I just realized this is a 2009 thread. What's appropriate? Do I delete all of my posts from this thread? Please advise. Thanks.

 

[army judge]

Well, you could have just suggested I look more carefully at the date of the post, which I will now do--and thanks for letting me know. Not sure immediately threatening me is the best route, but so be it.

I'll be more careful. I just found the threads interesting, but i now notice that you are correct and a number of them were old. They came up in my query for a topic I found interesting.

Happy to avoid commenting on other's posts as well.

Oops. I just realized this is a 2009 thread. What's appropriate? Do I delete all of my posts from this thread? Please advise. Thanks.

I won't argue or debate with you.
I've requested you to comply with our policies a couple of times.
This is your last warning, so please heed my admonitions.
You need not agree with me, simply follow our very simple rules, rules that we learned in kindergarten.
Thank you.