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lwpat, Attorney
Category: Business Law
Satisfied Customers: 25387
Experience:  Attorney with over 35 years of business experience.
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co-owners are at odds. the business is incorperated one owner

Customer Question

co-owners are at odds. the business is incorperated one owner listed as cfo and the other as ceo. the cfo owner put in all the money to open the business and works at the business. the ceo owner is working at the business six days a week and barley clears min. wage. his name is XXXXX XXXXX bank account and the lease. the cfo owner contends that the ceo owner as a "non-contibuting partner" has no rights or legal course for ending business relationship and can make no claim to finaces eventhough business is making money. what rights if any does the ceo partner have?
Submitted: 7 years ago.
Category: Business Law
Expert:  lwpat replied 7 years ago.
Here it depends on who owns the stock of the corporation, not their titles. If they each own 50%. The CEO has put in sweat equity and has the rights equal to his share of the ownership in the business. I have handled several of these freeze out cases and they can get expensive and take a long time to settle. He needs to consult a business attorney as soon as possible.
Customer: replied 7 years ago.

cfo owns 51% and cfo owns 49%









Expert:  lwpat replied 7 years ago.
The one with the 51% controls the corporation and can freeze out the other party and even terminate his employment. The minority shareholder does not have much that he can do except contact an attorney.