Can Dutch casting agency Kemna Casting get rid of shareholder Job Gosschalk?
The Dutch casting agency Kemna Casting wants to break all ties with Job Gosschalk, who became discredited as a result of sexual misconduct. Kemna Casting even wants to end Gosschalk’s shareholdership. The question is whether Gosschalk can be forced to do so. AMS Lawyer Onno Hennis, having looked into the Trade Register and having studied Kemna Casting’s Articles of Association, discusses Kemna Casting’s (im)possibilities of having Gosschalk surrender his shares.
Press release: Termination of Gosschalk’s shareholdership
Kemna Casting stated in the press release that “all joint ventures between Job Gosschalk and Kemna Casting have now been terminated” and that his “possible indirect influence as a voting co-shareholder of Kemna Casting and affiliated companies will be terminated as soon as possible.” That would seem clear, but what is the legal situation?
Gosschalk deregistered as a director on 13 November
The full name of the company that administers the casting agency’s activities is Hans Kemna Casting B.V. This company is managed by another company, De Gossies B.V. Gosschalk and his nephew are the directors of De Gossies, and therefore indirectly of Kemna Casting. At least, until last Monday.
The Chamber of Commerce’s Trade Register shows that Job Gosschalk was deregistered as an (indirect) director of Kemna Casting on 13 November last year. This means that Job Gosschalk was dismissed or left voluntarily. The dismissal of a director generally implies the termination of his employment contract or management agreement. Job Gosschalk is therefore not or no longer directly involved in Kemna Casting’s business operations.
Gosschalk is still a shareholder
However, as follows from the press release, Job Gosschalk is still a (joint) shareholder in Kemna Casting. It is not known who the other shareholder(s) are and what the mutual relationships are. This is because the Chamber of Commerce – unlike in the case of a 100% shareholder – does not disclose the shareholders and their respective interests.
Kemna Casting’s Articles of Association offer no solution
Depending on the mutual relationships and agreements, it is questionable whether (the other shareholders of) Kemna Casting will succeed in terminating Job Gosschalk’s shareholdership. Kemna Casting’s Articles of Association do not contain any mandatory offering requirements for this situation. Recourse to the Articles of Association will therefore not benefit the other shareholders. You cannot just get rid of a shareholder. The idea behind this is that as a shareholder you cannot be ‘expropriated’ just like that. The right of ownership (including of the shares) is the most comprehensive right.
It is customary for shareholders to establish their mutual relationships in shareholders’ agreements. This often includes a provision that in some situations shareholders will be obliged to offer their shares. For example, in the case of bankruptcy, death, or illness. Sometimes shareholders may be obliged to offer their shares if they violate the interests of the company. However, it is not known whether this had been agreed with Job Gosschalk because a shareholders’ agreement is not public.
Obliging the shareholder to sell: The squeeze-out procedure
If there is no shareholders’ agreement and Gosschalk refuses to cooperate voluntarily, the other shareholders will have to ask the court to compel him to sell his shares. Such a claim is rarely allowed. A shareholder can only be forced by the other shareholders to transfer his shares in a so-called squeeze-out procedure if his conduct has damaged the interests of the company. The question is still very much whether this is the case.
Gosschalk’s ‘transgressive behaviour’ not relevant to squeeze-out procedure
According to legislative history, behaviour that damages the good name and reputation of the company but is not directly related to the performance of the shareholder, cannot lead to a forced transfer. It must be demonstrated that as a shareholder, Gosschalk has jeopardised Kemna Casting’s functioning. It remains to be seen whether the accusations of sexually transgressive behaviour against Gosschalk are relevant. It is much more about other issues in a squeeze-out procedure. For example, the question whether Gosschalk would have frustrated important decision-making processes (such as attracting the necessary funding). As far as we know, this was not the case.
In short, if Gosschalk does not cooperate voluntarily, he will probably remain a ‘normal’ shareholder of Kemna Casting.