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Equity equates to liability if the company folds and incurred debt. Hence all the shares must be defined at the point in time and not only 5% now and then anoth
by redhex 18y ago
Equity equates to liability if the company folds and incurred debt. Hence all the shares must be defined at the point in time and not only 5% now and then another 5% when X is done.
- sokoloff 18y agoI think that's wrong on two accounts: 1. True corporate debt dies when the company dies, just as personal debt dies with the person. If someone has signed a personal guarantee on "corporate" debt, that's not the case, of course, but in that event, the shareholders of the company are not obligated to dip into their pocket to satisfy what amounts to personal debt of someone else. 2. If 90% of the shares remain with the company as treasury shares and you and I, as co-founders, each has 5% of the company vested, then our 5% stakes ALSO have a beneficial interest in the proportional share of the treasury shares. In a valueless company, of course that's irrelevant.