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Stupid question, but if you straight-up own 40% with none of the usual options/vesting stuff, then can’t you just tell Jim to go stuff it until he comes up with
by chasing 7y ago
Stupid question, but if you straight-up own 40% with none of the usual options/vesting stuff, then can’t you just tell Jim to go stuff it until he comes up with an offer to buy that 40% back that sounds reasonable to you?
You came together a couple years ago with a plan to make something and own it 60/40. Now you have something and you own 40% of that thing. I’m not sure how your continued employment matters at this point. It’s like saying someone needs to be employed at Apple to own Apple stock. They don’t.
Maybe I’m missing something.
- rolltiide 7y ago> Maybe I’m missing something. That the entity was never capitalized and the 60% founder paid for the app development out of his own pocket and plans to just reincorporate another entity and sell the app that way
- deleted 7y ago[deleted]
- mickeyM 7y agoThanks chasing, the problem may be what rolltiide mentioned - I'm not 100% sure whether Jim just can't establish a new company without me
- chasing 7y agoIn your position I would assume I have rights of ownership and act like it until I was told definitively otherwise. He put in money, but you put in time and expertise, which is also a high-value thing. He can start a new company but he can't sell something he doesn't own. And if he does, keep a tab on the new company. If they do well, you may be able to go after them for being built on software you partially own. Don't just flip over and shrug.
- mickeyM 7y agoYeah, after some comments from others I've realized that Jim doesn't really own all of the code/app. I guess that would be what I would do if he just starts a new company - wait and see what happens and if they get somewhere, I can go after them as you've mentioned. Thank you!
- hangonhn 7y agoIf Jim can close shop and start a new company without using any of the original company's assets/IP/trademarks/goodwill then there's nothing you can do about it. He has essentially declared bankruptcy and started a new company on his own. However, if he can't do that and you outright own 40%, then like GP said, "he can stuff it" (love the wording BTW). If the original company has any value to Jim, then you two should come to some reasonable agreement to settle the matter in a way that's acceptable to both of you.
- chasing 7y agoBut Jim only owns 60% of the app. OP owns the rest. It doesn't matter if Jim put in $10m if the agreement is that they own the app 60/40. Anyway, to echo other people: This is why you use clear contracts and try to deviate from the norm on these things only when you have to. Because otherwise disagreements become complex and expensive to resolve.