Phil is the managing director of ABC Pty Ltd, a family business. There are four shareholders in the company; Phil, his wife, Amy, and their two children, Chris and Natasha. Phil holds 25% of the shares with each of the other family members holding 10%. Amy is a director of the company, as is Chris. Natasha has always been excluded as part of the day-to-day management of the company as Phil has determined that the company, on his retirement, would always go to his son Chris . Natasha has expressed a desire to be more involved, but this has always been ignored. Additionally, an external investor, Shane holds the remaining 45% of the shares. Shane has been romantically interested in Natasha since the first day he laid his eyes on her. They started dating in 2021. After a whirlwind romance, Natasha and Shane plan to wed in October.

A) In September, Phil, Amy and Chris come to see you. They are very worried about the impending marriage, as this means that Natasha and Shane will hold over 50% of the voting power in the company. They seek your advice regarding diluting Natasha's shares. They want to know whether a share dilution is possible and in what circumstances it would be legal. They have also asked you how this might affect their decision making power in the company.

B) After the wedding, Natasha comes to see you, having already started to utilise her and Shane's voting power to alter decisions made in the company. She wants to know whether she is able, with the help of Shane, to appoint herself as managing director.

C) Natasha would also like to know whether she and Shane can remove Phil as a director, as an act of revenge for always excluding Natasha.

D) If Natasha was a director, would removing Phil, for revenge, breach any director's duty? (5 marks