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Richard - Bizlaw
Richard - Bizlaw, Attorney
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Experience:  30 years of corporate, litigation and international law
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I am the only shareholder in 2 S-Corporations in Texas. 3 questions....

Resolved Question:

I am the only shareholder in 2 S-Corporations in Texas. 3 questions....

1. I want to add 2 people to the board of directors, do they have to be shareholders?

2. To do this I assume I just need to record an entry in our corporate minutes to show I elected them to the B.O.D.?

3. I want to also sell them some shares, but both are married and I want to protect the company from their spouse selling shares to say like a competitor, would a "first right of refusal" clause in our bylaws ensure that if they get divorced ensure that our company would be able to purchase the divorcee's half of the shares first so they can not be sold to just anyone?
Submitted: 5 years ago.
Category: Business Law
Expert:  Richard - Bizlaw replied 5 years ago.
The answers to your questions are as follows:

1. No.
2. Yes you should have either a shareholder meeting at which a resolution is adopted increasing the board to three people. You would also have a resolution electing the two people to serve as directors. In lieu of a meeting you can do a unanimous consent in writing by yourself, the sole shareholder.
3. You can sell the shares pursuant to an agreement that restricts them from selling to anyone other than the company without the approval of the company and subject to the same restriction. This would be contained in a shareholder agreement. I strongly suggest you have an attorney prepare the document and not try to do this yourself. You would as part of the agreement, require that the shares be legended so that when the shares are issued they carry the legend on their face showing that they are governed by the shareholder agreement and cannot be transferred except as set forth in that agreement.

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Richard - Bizlaw, Attorney
Category: Business Law
Satisfied Customers: 8861
Experience: 30 years of corporate, litigation and international law
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Richard - Bizlaw
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30 years of corporate, litigation and international law