A compulsory transfer is when a shareholder must sell their shares to the company’s remaining members. A compulsory transfer may be triggered by various events, for example, when a shareholder:
is an employee or director of the company and resigns
commits a material breach of the Shareholders' Agreement, which is not remedied
In such circumstances, the price paid for the shares will be the fair value or the nominal value, whichever is less. Fair value is estimated based on an analysis of the company's financial information, including market demand, market price, and any company liabilities or debts.
For more information, read Compulsory transfers of shares.