C corporation · Legal

Company is dissolving and I am a shareholder, how to make sure I get what I deserve?

Nicolas Cabrera Happy Human and Deveoper

May 2nd, 2016

The company I hold share was doing good on sales and as long as I know they profit, now for some reason I don't know they are dissolving the company and they want me to sign a document... but I ask myself if I should get something ($$), I don't know how this work and what should I ask. Any advice?

Here is the document I need to sign:
https://drive.google.com/file/d/0BwrOqecSXJqoWjR1eGwzdlFyeUE/view?usp=sharing

Thanks

Anonymous

May 2nd, 2016

Nicolas,
While it is not illegal for anyone on this forum to give you legal advice without a license, so long as there's no payment involved, remember that free legal advice is worth what you've paid for it.

Nicolas Cabrera Happy Human and Deveoper

May 3rd, 2016

Hi guys! thanks for the help. Here is an update in case someone in the future is having the same issue.

This the the second part of the document, yesterday I had no time to upload it but here it is in case u want to see.

There is no explanation, just "we are closing".

https://drive.google.com/file/d/0BwrOqecSXJqoV01xS1lNNV9fRk0/view?usp=sharing

I asked to the co-founder for the assets in the company, I'm waiting for an answer, I'll keep you posted.

Michael Brill Technology startup exec focused on AI-driven products

May 2nd, 2016

Was there any letter that went along with this? If not, then I'd ask for/demand an explanation. Companies fail all the time, but it's really bad form to not explain what happened to investors. And dissolving a company is quite a controlled/planned event - that means they exhausted efforts to raise more money and any assets and liabilities have already been dealt with. In other words, they've had plenty of time to offer an explanation but have chosen not to. I'm not sure I've ever heard of someone doing that.

But I wouldn't count on any $$$.

Phillip abd Founder School of Entrepreneurship, Lead Professor, Venture Capital, Finance, Taxation, Marketing, Management, Education

May 8th, 2016

Woflgang:  You have rights to the value of your stock percentage of ownership which your control.  You also have the right to inspect the corporate books to see where the money is, where the money is going or went and what money and/or assets are left to dispose of and be converted to cash.  Of which you are entitled to your share of the  proceeds from the dissolution based upon your percentage of ownership.  I would request a meeting with the CEO and CFO to open the books for your inspection.  If they do not cooperate your next decision will be to determine if your assumed value of any remaining assets are worth your time, energy and money to persue.  I would also contact the state of incorporation to see what rules and regulations can be enforced by the state to secure and preserve your position.  If all else fails, you will have to search for an experienced and TRUSTED attorney to assist you. 

Phillip D. Mrozinski,  Strategic Business Institute

Anonymous

May 2nd, 2016

Nicolas,
To build on Igor's comment, depending on the value of the assets involved, it may behoove you to consult with an attorney.  At the least, you should be aware of all the assets in the company at the time of its dissolution - a part of which you may be entitled to.  There are many factors involved, so again, your best chance to validate if you're owed anything is by consulting a knowledgeable attorney.

Bob Troia Entrepreneur. Builder. Creative Technologist.

May 2nd, 2016


"Delaware's General Corporation Law ("GCL") provides for voluntary dissolution through a stockholder vote at a stockholder meeting. Before the vote, your board of directors must adopt a resolution to dissolve, submit it to the stockholders, and call the stockholder meeting to vote on the matter. You are required to give ten days advance notice to each stockholder entitled to vote on dissolution. A majority of the outstanding stock entitled to vote must approve the dissolution. If you use this method, make sure to properly record both the board's proposal and the stockholders' votes."

"The GCL also allows you to avoid a formal stockholder meeting and vote at if stockholders entitled to vote on dissolution provide their written consent."