Joan was the managing director of Set Design Ltd (the company) and currently owns 20 per cent
Question:
Joan was the managing director of Set Design Ltd (‘the company’) and currently owns 20 per cent of the company’s shares. Acting on behalf of the company, Joan entered into negotiations with MovieWorld plc (‘MovieWorld’), an international food service company, for the design of a fast food outlet based on the hit series Game of Thorns, which would then be franchised around the globe. MovieWorld liked the design and awarded the contract to the company. Shortly afterwards, Joan resigned her directorship from the company and formed her own company, Joan Ltd, which entered into another contract with MovieWorld for the design of another restaurant at one of its sites. The directors of Set Design Ltd have discovered what she has done and are proposing to alter the articles to include a provision which requires any shareholder to sell their shares to the directors if asked to do so in writing and at a price fixed by them. The directors then intend to rely on this article to require Joan to sell her shares to them.
In relation to the alteration of the articles of association only critically discuss any action the directors of Set Design Ltd may take.
