Legal Question in Business Law in Massachusetts

Re: family business sale

This is a very complex answer. A sharholder is entitled to vote his shares as he wishes, but he still owes a fiduciary duty to the other shareholders under MA law. Moreover, the acquiring company has some limitations on what incentives it can give to a single shareholder of a company who is an employee or a major shareholder of the acquiring company.

If you have not contacted an attorney, you should do so immediately.

Re: family business sale

IN a sale, all shareholders have an interest and therefore a bias; I cannot see from the facts you stated where this is an improper vote.

Re: family business sale

Not necessarily, but as other answers have indicated, the facts and circumstances will determine what is appropriate, and what is inappropriate. In addition, there are certain statutory rights that minority shareholders can exercise in response to what they deem an unreasonably low offer, in addition to whatever other contractual rights they might have due to a shareholder's agreement, bylaws, or articles of organization.

Note that objections must be raised in a timely fashion, so you should contact an attorney promptly if you have not already done so.

If you need legal counsel, please feel free to contact my office.

Re: family business sale

This is a very complex area and you would need to provide more facts and all relevant documents. Articles of incorporation and bylaws are the basics, but then any and all stockholder agreements and actions at stockholder meetings (or by written consent) can all pertain to the rights and obligations of the stockholders.

Under MA law, stockholders in a closely-held corporation owe the same fiduciary duties of good faith and loyalty as to partners in a partnership. This does not mean that a stockholder cannot act in his own interest, but if, hypothetically, the buyer offered an excessive amount of compensation to influence the swing voter described in your question, this could land that stockholder in very hot water.

Best wishes,

LDWG