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Dimitry K., Esq.
Dimitry K., Esq., Attorney
Category: Business Law
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Experience:  Run my own successful business/contract law practice.
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I sold my business 2 years ago to a Canadian Company. We did

Customer Question

I sold my business 2 years ago to a Canadian Company. We did a stock swap (penny stock registered in the Toronto Exchange).The value of the Stock at the time was .016 US.
Our commitment was to work for the Company for a year in order to transfer our knowledge. Half of our stock was supposed to be released from any restrictions at after six months from the date of the agreement, the balance a year after. My husband contract expired and he wanted to start a new business. We needed to sell some stock. We could not do it because of the restrictions in the back of the stock were never removed. My husband requested for the restrictions to be removed in November 2008. For a year through numerous telephone calls, e-mails, and personal conversations with their Corporate Attorney, CEO and Chairman of the Board finally they changed one restriction for another: refering to "the agreement". Because of their delay Jan '09 was at $.011 now is .005 and we can not trade it either in US or Canada.
Submitted: 4 years ago.
Category: Business Law
Expert:  Dimitry K., Esq. replied 4 years ago.
Maria,

Thank you very much for a very interesting question. I have a few questions to help me understand the situation better.

1. When were the restrictions supposed to have been removed?

2. Do you still own 10% of the company?

3. The company is now legally Canadian, correct?

Sincerely,

Dimitry Alexander Kaplun, Esq.

Edited by Dimitry Alexander Kaplun on 11/3/2009 at 3:37 AM EST
Customer: replied 4 years ago.
1-September 2008
2- yes
3-yes
Expert:  Dimitry K., Esq. replied 4 years ago.
Great. Thank you very much for the information. This helps you tremendously.

1. If the limitations were not removed, you can argue fraud, bad faith, and can directly attribute any loss to their inaction. I am not sure of what the value difference would have been, but you can legally sue for that difference, especially if you have copies of correspondence that was transferred back and forth to show that the information was not provided to you as expected.

2. In the US (I am not sure about Canadian law), a 10% stockholder can bring suit against the company.....and have the COMPANY pay his legal fees if he prevails. This may be something for you to consider and I suggest you contact a securities attorney who can quite possibly give you more specific information.

3. Since you can directly show damages due to their inaction, you have a very strong case. I urge you to not delay and retain an attorney who is licensed in both Canada and the US, and who specializes in securities law.

Sincerely,

Dimitry Alexander Kaplun, Esq.

Edited by Dimitry Alexander Kaplun on 11/3/2009 at 3:45 AM EST
Dimitry K., Esq., Attorney
Category: Business Law
Satisfied Customers: 37492
Experience: Run my own successful business/contract law practice.
Dimitry K., Esq. and 6 other Business Law Specialists are ready to help you
Customer: replied 4 years ago.
Great advice! You are awesome. I will let you know the results.
Thanks,
Maria
Expert:  Dimitry K., Esq. replied 4 years ago.
Maria,

Good luck and please do. You have a very serious (but also a very interesting and complicated) situation which I would love to assist you with, if you have any further questions or concerns.

Sincerely,

Dimitry Alexander Kaplun, Esq.

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