Peculiarities of share selling in the charter capital of LLC
According to Art. 53 of the Law of Ukraine “On Economic Companies”, each member of LLC has the right to alienate his/her share (or its part) in the charter capital to other members or third parties, and alienation of the share to third parties is possible only if there is no direct prohibition on such alienation in the LLC charter.
Members of LLC have the right to buy alienated shares (or its part) in proportion to the size of their shares (unless otherwise is provided by the charter or by the agreement between the parties), thus, the share is alienated to other members at the price and on conditions that it can be offered to third parties.
The member must notify other members of his/her intention to sell the share, and members have preference to buy the share within one month from the date of the notification. If members of LLC did not buy the alienated share within one month (or other period specified by the charter or by mutual agreement), it may be alienated to third parties.
If the member alienates the share to third parties without taking into account the preference of other members, the alienation agreement cannot be invalidated, but in this case, each of the members of LLC can bring a legal action for transferring of the buyer’s rights and obligations, moreover the plaintiff must deposit the amount of money on the account of court, which the seller must pay under the contract. The term of the limitation of actions shall be applicable to the given claim in the period of one year.
To avoid unnecessary litigation related to the share alienation in the charter capital of the company, the lawyers of the Colares Law Company are always ready to represent your interests in court, and are ready to conduct the registration of the change of the founders of the company, change the name of the company, its director, and conduct the registration of change of the economic activities.