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Attorney2020, Attorney
Category: Business Law
Satisfied Customers: 2578
Experience:  I am a practicing attorney. I have experience in business law, bankruptcy, real estate law and estates.
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Question regarding dissolving a 50/50 scorp in california.

Customer Question

question regarding dissolving a 50/50 scorp in california. The corp was started over 15 years ago and hasnt earned any money for almost five years. There are no debts and no funds to be distrbuted. The person who wants to dissolve is the president and has 50% of the shares. They are the only two people ( shareholders?)in the company and have not done any business together since then. We see that it is possible to fill out the certificate of election to wind up and dissolve form and file it with secretary of state as a 50% shareholder but are unsure if it is allowed to also file the actual certifcate of Dissolution. The other party refuses to cooperate or even accept the entire company in full at no charge. ( he tried with lawyer for a year and were ignored.) Can this entire process of dissolution be carried out including the filing of both the ELEC STK And the DISS STK form? Looks like there is no problem signing and filing the ELEC STK form as 50% controlling but not sure about DISS STK because it says you have to be sole director
Submitted: 1 year ago.
Category: Business Law
Expert:  Attorney2020 replied 1 year ago.

A corporation may not be dissolved absent any agreement otherwise based upon a 50% ownership interest. A majority of the shareholders must vote for dissolution. Alternatively, the other shareholder and transfer all of his shares back to the organization and resign detaching from the corporation entirely. That would appear to resolve the issue and the sole shareholder would be stuck with dissolving or maintaining the operation of the corporation.

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