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INFOLAWYER
INFOLAWYER, Attorney
Category: Business Law
Satisfied Customers: 54241
Experience:  LICENSED BUSINESS LAWYER
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Hi - my husband & I own a small business together (Im president,

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Hi - my husband & I own a small business together (I'm president, he's VP of our company). Due to the downturn in the economy, we have five months behind on our rent (which we have a limited personal guarantee as well as a good-guy clause on the lease) and our other debts are increasing. I feel it's time to close the business, but he strongly disagrees - we have been at a stalemate for months and it is affecting every aspect of our personal & professional lives. Do I have any legal course of action as president of the company to insist we cut our loses and close, even if he absolutely refuses? We each own 50% of the stock in our company (we are a Sub-S Corp).
Submitted: 7 years ago.
Category: Business Law
Expert:  INFOLAWYER replied 7 years ago.
If 2 parties own a business and cant agree what to do with it there are several options
1. sell from one to the other
2. if one cant be done, try to have a third party mediate a solution
3. if one and two cant be done, then one of the parties would commence a lawsuit to force the sale of the property and division of the proceeds. often the threat of such a suit makes options 1 and 2 become more successful as both sides realize that it expensive to litigate.
To find local counsel to represent you, see www.martindale.com
Customer: replied 7 years ago.

1. Neither of us has the financial means to sell to the other

2. We tried mediating a solution and we could not come to an agreement

3. No one is going to buy our business with less than three years left on our lease in this economy.

Is there any other course of action?

Expert:  INFOLAWYER replied 7 years ago.
one of the parties would commence a lawsuit to force the sale of the property and division of the proceeds.   I am afraid these are your limited options.
Customer: replied 7 years ago.

Sorry, but I need some clarification:

-If I were to commence a lawsuit to force the sale of the property, does everything stay 'status quo' until there's a buyer? If there's no buyer, does the lawsuit protect me in any way in terms of the limited personal guarantee?

Expert:  INFOLAWYER replied 7 years ago.
The lawsuit does not maintain status quo to the extent that other parties and creditors are not frozen in place but practically many will wait for the action to take place.   
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