Page 6 - Jupiter West - February '24

Page 6, Jupiter West
Considerations Before Becoming A Minority Owner
Submitted by Anné
Desormier-Cartwright, Esq.
Becoming a minority owner
in a business can give you the
opportunity to help a business
grow and share in its success
without the management
responsibilities. Minority
owners may be brought in
to facilitate growth, perform
acquisitions, or achieve other
strategic goals and often
provide valuable expertise in addition to the capital investment
they make in the business.
However, because a minority owner owns less than 50 percent
of the business, and state business laws typically give minority
owners limited rights, the minority owner may be at the mercy of
the majority owners. If a conflict arises and the minority owner’s
rights are infringed, they can file a lawsuit. Conflicts can also be
Library’s annual BookMania!
set to take place March 2
The Martin County Library System is excited
to announce that the 2024 BookMania! annual
event, sponsored by The Library Foundation
of Martin County and Florida Humanities, will
take place on Saturday, March 2, 2024, at the
Jensen Beach High School Performing Arts
Center, 2875 NW Goldenrod Road in Jensen
Beach, starting at 9:00 a.m.
BookMania! is free and open to the public.
Authors will participate in one of multiple
panel discussions featuring emerging and
prominent writers. The auditorium can get
chilly, so please bring a sweater. Titles by
guest authors are available through the
library’s collections. Lunch from the Martin
County Sheriff's Office BBQ team will be
available for cash-only at the event. Barnes
& Noble Booksellers will be onsite offering
purchased coffee and light refreshments in
addition to facilitating book sales.
Sea Stories - Fact & Fiction
9:15 am - 10:00 am
Moderator: Peggy Chittum
Kevin Sites: The Ocean Above Me
Earl Swift: Chesapeake Requiem - a year with
the Watermen of vanishing Tangier Island
Thriller & Suspense
10:30 am - 11:45 pm
SIGNING 11:45 am - 12:15 pm
Moderator: Amanda Brack
Darby Kane: The Engagement Party
Armando Lucas Correa: The Silence in her
Eyes
Megan Collins: Thicker Than Water
LUNCH 11:45 am - 12:45 pm -
signing and lunch
Love, Friendship, and Ever After's
12:45 pm - 1:45 pm
SIGNING 1:45 pm - 2:15 pm
Moderator: Linda Weiksnar
Kristy Woodson Harvey: The Summer of
Songbirds
Melissa Rivero: Flores and Miss Paula
Historical Fiction
2:15 pm - 3:15 pm
SIGNING 3:15 pm - 3:45 pm
Moderator: Paula Hundt
Talia Carner: The Boy with the Star Tattoo
Patti Callahan Henry: The Secret Book of
Flora Lea
Katherine Reay: The Berlin Letters
This popular program has received national
recognition for its stellar authors, record
attendance, and impressive Barnes &
Noble book sales. For more information,
visit www.library.martin.fl.us and search for
“BookMania!” or call 772-288-5702.
Funding for this program was provided
through a grant from Florida Humanities
with funds from the National Endowment
for the Humanities. Any views, findings,
conclusions or recommendations expressed
in this program do not necessarily represent
those of Florida Humanities or the National
Endowment for the Humanities.
prevented through a written agreement that modifies state law Negotiating Stronger Minority Owner Protections
and more strongly protects the minority owner against oppressive It may be that a minority owner has their eyes only on
conduct. In addition, under the new law that requires disclosure of financial gain. But that goal can be in jeopardy if the majority
beneficial ownership interests to the government. More to come owners find ways to spend and reinvest money that would
in another article about reporting requirements. otherwise be distributed to the minority owner as profits.
Minority Owner Rights Profits from a business sale cannot be guaranteed, either, if
Most companies have a small number of private owners and the sale is structured in a way that prevents minority owner
do not publicly issue ownership interests. Business entities such payouts. Minority owners also cannot count on the ability to
as corporations, partnerships, and limited liability companies sell their ownership interest, since state law often limits the
(LLCs) may have this type of ownership structure. A minority right to force a company buyout.
owner is an owner who owns less than 50 percent of the business. However, minority owners do not have to accept the
They may, for example, invest $50,000 in a company in exchange limited default rights they have under state statutes. An
for a 20 percent interest. Because a minority owner does not operating agreement and a buy-sell agreement can include
have a controlling stake in the business, however, they have provisions that provide additional protections for minority
fewer rights than majority owners. Generally, in the absence of owners.
a written agreement that expands their rights, a minority owner Prior to obtaining a minority stake in a company,
is only entitled to the following. prospective owners should consider their expectations about
● The right to vote on certain matters, such as electing the the following types of issues.
board of directors (corporation) or managers (LLC) ● Level of involvement in day-to-day company
● The right to inspect company books and financial records management
● The right to receive dividends from the business (if ● Decision-making authority regarding company changes,
including the sale of the business or a merger or acquisition
there is a distribution of profits) and proceeds from the sale
or dissolution of the business ● Equity payments from company operations
● The right to sue majority owners for breach of ● The ability to sell an ownership interest or be bought
fiduciary duty out by the other owners
Outside of these basic rights, minority owners may find that, ● Distributions from the sale or dissolution of the company
despite their investment in the company, they have little or no Initial expectations can be set during a discussion with
ability to control the direction of the company and no right to business partners, but handshake agreements do not go
participate in daily decisions. If the minority owner is also a far enough. The agreed-upon understanding between the
company employee, they do not have the right to continued minority and majority owners should be in writing and signed.
employment if they are fired. They also lack the right to demand Absent a written agreement that solidifies their rights, a
distributions if the majority owner does not make them. minority owner relies on the majority owners’ good faith.
Oppression Of Minority Rights Should that faith prove to be misplaced, a minority interest
The rights of a minority owner, while limited, can be holder may realize – too late – how vulnerable they are to
enforced based on state statutes that provide protections aimed the majority.
at preventing “minority shareholder oppression.” In addition, Protect Yourself As A Minority Business Owner
although majority owners have nearly unlimited discretion over Trust is important, but trust that is not backed up by written
how to run the company, they still have a legal duty – known as a agreements will not get you very far if trouble arises. Some
fiduciary duty – to not place their own interests above the interests of these problems may not be anticipated until they arise.
of the company and its minority owners. However, depending Others can leave you grasping at legal straws.
on state law, the majority owner may owe fiduciary duties only As a minority business owner, you do not have to accept
to the company and not to a minority owner. the limited protections that state statutes offer. It is fully
Minority oppression may occur in situations such as within your power to negotiate more favorable terms as a
the following. condition of taking on a minority owner role.
● The majority owner refuses to make profit distributions Before investing your time and money in a business
when the company is profitable. venture, it is prudent to consult a lawyer. Our business
● The majority owners are excessively compensated. lawyers can help you solidify your expectations with legally
● The majority owners dilute the voting rights or enforceable documents. If you already have agreements in
ownership of minority owners. place, we can also advise you of your rights to bring a breach
● The majority owners unreasonably restrict the sale or of contract or minority oppression action. To discuss your
transfer of minority membership interests. needs, please contact our office and set up an appointment.
● The majority owners deny a minority owner’s access to Call our office today at (561) 694-7827, Elder & Estate
financial records. Planning Attorneys PA, 480 Maplewood Drive, Suite 3,
● The minority owner is fired as a “squeeze play” to Jupiter, FL 33458.
eliminate their ownership interest. The content of this article is general and should not be relied
Again, majority owners have a lot of leeway in how they upon without review of your specific circumstances by competent
operate the business, and not all of these examples will rise legal counsel. Reliance on the information herein is at your
to the level of oppression in every case. To prove oppression, own risk, as it expresses no opinion by the firm on your specific
it may be necessary to show that the actions of the majority circumstances or legal needs. An attorney client relationship is
owner toward the minority owner not only interfered with not created through the information provided herein.
the latter’s interests, but also were intentional. Making this To comply with the U.S. Treasury regulations, we must
determination requires a case-by-case analysis in accordance inform you that (i) any U.S. federal tax advice contained in
with the relevant facts and state law. this newsletter was not intended or written to be used, and
A successful oppression lawsuit may result in the payment cannot be used, by any person for the purpose of avoiding
of monetary damages, a court-ordered buyout of the oppressed U.S. federal tax penalties that may be imposed on such person
minority owner, or equitable relief, such as requiring the and (ii) each taxpayer should seek advice from their tax
company to cease their specific oppressive actions. advisor based on the taxpayer’s particular circumstances.
Why Can’t My Child Keep Up?
By Jim Forgan, Ph.D., dysgraphia. She was a smart girl but her language disorders
Licensed School Psychologist interfered with her ability to listen, follow directions,
A c onc erned m om discriminate sounds, and express herself. Since writing
explained her child’s
and reading are language-based skills she could not put her
struggles to me: “I feel like thoughts into writing and while she could memorize, she
sometimes Jenny cannot keep could not pronounce unfamiliar words. Jenny had a strong
up with a conversation. When memory and could memorize adequately so this concealed
we are talking she often stops her true struggles.
and asks questions to explain Jenny’s mom wanted to know how to help Jenny so our
more or again. When she recommendations provided her with the best reading program
hears a new word, she does and some tutors. We also provided a list of games they could
not seem to hear it correctly. purchase to play at home to help. Testing helped dad learn
We have to repeat it a few times and break it down into the that when Jenny could not get to the point, he needed to give
sounds for her to finally get it and repeat it back correctly. more patience and understanding. The testing also provided
When she is telling a story or giving information, it can take
mom with paperwork to share with Jenny’s school staff. They
her a long time to think of what she wants to say and if you developed a plan with goals to help Jenny in school. We
interrupt her she has to start all the way at the beginning again discussed next steps in our one-hour results review meeting.
and she gets frustrated. She says kids at school make fun of It’s unusual for smart children to experience long-term
her because she can’t read.” academic struggles. You know your child best so if you are
Our school neuropsychological testing showed Jenny had concerned, call to discuss your child. Visit JimForgan.com
a language-based learning disability along with dyslexia and or call (561) 625-4125.