Company share

[Wish1719]

agreed with you, i still perfer "an option to purchase" rather than "offer to sell".

like you said, sounds fishy

[Carmour]

If its a "private limited" company, shareholders do not have to bear responsibility in cases of the company going bankrupt.

[Carmour]

Option only to sell back to the company?

Normally this clause should be "first option for the company to buy back its shares".

 

You should find out how does the company place a value on its shares.

Normally, it is by a multiple of annual revenue, or multiple of annual profit.

 

 

the contract only allow the shares to sell back to the company or himself if i left next time

Edited June 25, 2008 by Carmour

[Kklee]

IMHO, if pay by installments, it's like having a pay reduction because you actually don't know how much additional you're getting because of the share. In other words, there is no guarantee.

 

If the company value your contributions, it's not difficult to just give you the shares as performance bonus... no need to make things so complicated.

[Blue2]

bro...do not want to pour cold water....

there is no such thing as free lunch in this world...

I believe there is a catch to this...

 

As 1 of the bro say why not he gives you better bonus if he values your contribution??

[Comnao]

precisely why i am worried for him

 

if he doesn't even know the coy is a Pte Ltd or Sole Prop ... he is really in deep sh1t

[Davidklt]

If you are not sure about this..i suggest you dont buy..

 

what is P/L and retain earning?

[Rayoh]

hi bro, pls let us know what is the percentage of shares your boss wanna sell you??

 

Like wat bro comnao and other bros has pointed out, you are definitely not ready. Furthermore, this sounds more like a scam. Imagine if you are the boss,company earning good healthy profit, will you wanna share the cake?? This is assuming your boss is offering you a substantial amount of shares of cos.

 

Can pay in instalments somemore?? Seems like your boss rather desperate to sell it off to you... Don't you think so...

 

If really interested, find out more abt the financial status of company before committing. Good Luck!

[Rickster]

A true incident that happened to my good friend.

 

She is doing sales in a local 15-man pharmaceutical equipment company. Her customer contacts are huge and she enjoys good sales every month.

 

After working for 2 years in this company, the company offered her 3% stake in the company which she took. In the end, every year during dividend time, she only got about $1K+. She is still being bossed around, stressed to hit target and no difference from being and employee. She told me that she felt the boss is trying to cheat them and use this 3% to hold them back.

 

Bottom line of the story bro:

 

1) How much shares are they offering you.

2) What are your responsibilities after accepting the offer.

3) How much profit sharing are you entitled to.

4) Condition for sales of shares.

 

I believe these are the things u need to seriously consider before taking the plunge. Good luck.

[Robo]

if your're not sure dont buy. if its pte ltd den can consider.

 

ask to look at the accounts, P&L(profit and loss statement) and balance sheet. this should be the one from the auditor not done by him.

 

if its healthy as in not too many creditors as in loans and more of liquid and tangible assets. in all the company gotta look as if they are able to bail itself out if sh1t hits the fan.

 

gd luck bro. look and see first dont rush. if he's sincere he will wait

[Rickster]

based on yr replies, i dont think you are ready for this thing.

i dont think you know enough about company laws to be a "mini boss"

better to pass on the offer... i think it smells fishy

 

nxt thing you know, the company go bankrupt nxt month and you are liable for the debts as a "shareholder"

 

I agree.

[Robo]

based on yr replies, i dont think you are ready for this thing.

i dont think you know enough about company laws to be a "mini boss"

better to pass on the offer... i think it smells fishy

 

nxt thing you know, the company go bankrupt nxt month and you are liable for the debts as a "shareholder"

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I agree. Nod

======

 

 

agree on that too

[Robo]

She told me that she felt the boss is trying to cheat them and use this 3% to hold them back

 

seriously if im the boss i would consider doing such things. this will allow the employees to have a sense of belonging and will strive hard for the co.

 

den again 3% is not alot for a SME unless its MNC

[Peqasus]

having internal rounds of funding is common for a company. but mostly more relevant should the company have listing ambitions.

 

Dun let greed make this decision for u.

 

Your boss could be

A) Offering u this to reduce your flight risk

B) Offering u this cos he's trying to cash out

C) Offering u this cos he really really think this is a good deal and he wants u to have it and you are an ASSET to his company

 

Let logic besides the fundamentals review as advised by most decide. You can look at 2 key areas

 

1) Do you see yourself working happily in this environment for the nex 3-5 yrs? Is the staff turnover high? Do you have many seniors who are like marathon runners in your company? Are they positive or negative? Do you think you can use the exp u gather here for your next job?

 

For a fresh grad, ur 1st deg worth diminishes at ard 32 deg unless you are in middle/hi mgmt already. With you niche skills and exp, it could work both ways for u. Either paid damn well or too niche to switch jobs.

 

2) Do see if your company has institutional ownership. U can check up www.acra.gov.sg to find out the shareholders list.