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Law Educator, Esq.
Law Educator, Esq., Attorney
Category: Business Law
Satisfied Customers: 111590
Experience:  All corporate law, including non-profits and charitable fraternal organizations.
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2 years ago I started an s corp with some partners as we started

Customer Question

2 years ago I started an s corp with some partners as we started an entertainment company based around music. There was 6 of us. One guy owned 51%, 2 guys owned 16.66% each, and 3 of us owned 5% each. A couple days ago we had a meeting based around the future of the company and the guy that owned 51% of the company proposed that if we want to move forward we would all have to invest more money into the company, otherwise we would forfeit our shares and basically have to bow out. Is this possible?
Submitted: 3 years ago.
Category: Business Law
Expert:  Law Educator, Esq. replied 3 years ago.
Unfortunately, business is an investment unless you received some guarantees on return of your money. Thus, if the owners are required to put more of their own money into the business to help it succeed they have to do so or they can risk losing their business completely. You can ask to be bought out of your shares and this is up to a vote of the members and this is going to be determined by the assets or the money the company has to pay out those shares. Your other option is you can seek to sell your shares to other parties to try to recover your money.

These are the options you have in dealing with this matter I am afraid.


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