More details to this question:
I started a corporation. I have an investor that agreed to purchase 45% of the corporation for $75,000. He agreed to pay $10,000 every 2 weeks to cover payroll as we grew, until the amount was paid off. He made 3 payments of $5,000 for a total of $15,000 and said he wasn't paying another penny into the corporation. We have NOTHING on paper, it is all verbal. He stated that he no longer felt comfortable with the business. I told him I would pay him back 100% of his investment. He stated that I can't do that and that I am now in breach of contract. So now, what do I do? He hasn't paid for his share. He said I can't pay him back. What are my legal options??
1 ANSWER
Business Transactions Attorney serving Los Angeles, CA
at
Doland & Fraade
Update Your Profile
You made a giant mistake not consulting an attorney and not preparing a written agreement. I am pretty sure the shares you issued yourself and then the shares you issued to the investor were improperly issued under State and perhaps Federal law.
Consult a lawyer now so this issue does not transform into litigation. I would "tender" $15,000 back to him and send a notice of rescision.
Answered on Jan 08th, 2015 at 12:37 PM