Ltd Company - director leaving - what are remaining director's liabilities? Help!!

[luella]

Hi,

I hope I'm in the right area - apologies if not.

I am a director of a small limited company. My co-director is wanting to resign as he is not enjoying working for the company any longer.

I want to continue the company but am worried that I will be lumbered with all of the current financial liability. I understand it is a company debt, but we both made the decisions that forced us to take out the loan and overdraft and I would obviously not want to take on all of the burden. I am going to seek legal advice on the issue but thought I'd ask on this forum in case anyone else has experienced similar issues.

We both own 50% of the shares. We both put in £25k to set up the company, the company has an overdrat and a bank loan - both of which are under personal guarantees by both directors.

My questions are: if my co-director leaves:

Will I have sole responsibility for the overdraft and loan? If so, is there anyway I can get him to share the liability? how will the original £25k be repaid to the leaving director (we have not yet made a profit)?, and will he still hold 50% shares in the company. Would it be best to wind up the company altogether and then both share the debt equally (and lose our initial investment)?

Any help would be greatly appreciated.
Many thanks. L.