Part-time co-founder is leaving, how can he hand back equity?
I had a part-time co-founder but he is leaving. How can he hand back equity?
I'm based in the UK and I've heard of a form called J10, but once this is done how do we change the information registered on CompaniesHouse?
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You can update the data held at Companies House online these days (in fact for many transactions, you have to do it online). You may have to pay stamp duty on the transfer of shares, check HMRC website for that: http://www.hmrc.gov.uk/sd/shares/sharetransfers.htm – Steve Jones 11 years ago
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Where do I update the share holder names on companies house? I cannot find any forms to do so - everything is just related to the types of shares, quantities, etc. – Olive 11 years ago
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You have to supply that information in your Annual Return, assuming it is a UK Ltd company. Also, the website has loads of forms relating to shares, etc, but it depends what will happen to the shares. Will they be returned to the company, split among other shareholders, etc? – Steve Jones 11 years ago
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They will be returned to the company. Does this mean that until the annual return companies house should not be updated on anything? – Olive 11 years ago
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Consideration? You should really talk to a professional about this, or at least learn how to do this stuff yourself. – Steve Jones 11 years ago
1 Answer
The company can always buy (back) equity from, e.g., a departing co-founder. So long as both sides agree to the transaction, no problem. This is just a straight sale of shares at an agreed price (often, but not always, at the price originally paid for the shares). The shares are held 'in treasury': the company owns the shares, unless it cancels them.
This handles the legal side of the transaction. As for the accounting form that you fill out to report changes in equity to the government (which presumably you do only for transactions over a certain percentage in the company stock), I can't help with that.
