Legal Question in Business Law in Arkansas

Company Granted Stock Shares

A former employer granted me 20,000 shares of common stock. I was informed of the grant by e-mail with no restrictions or guidelines. I later resigned. I requested the stock certificates. The company stated I was not eligilble due to my resignation. The company is attempting to sell itself to other related companies. Where do I stand? The timeframe has been 11 months. Do I have a claim? This company is an LLC in Nevada. The only evidence I have is a printed copy of the e-mail. Please advise. Book value of stock was around $ 2.00/share at the time I was notified of grant.


Asked on 6/14/99, 10:00 pm

1 Answer from Attorneys
Edward Hoffman Law Offices of Edward A. Hoffman

Re: Company Granted Stock Shares

You say the employer "granted" you the stock, but this phrasing is a bit ambiguous. Was the stock given to you as part of your compensation package? Were you told previously that you would earn the stock if you did something in particular (e.g. remain employed for a certain period of time, meet certain goals, etc.)? Were you subsequently told that you had to do anything to earn the shares? Did other employees get the shares as well? Did you do anything in reliance on the promise that you would receive the shares?

I asm these questions because the company may try to claim that the stock was a gratuitous transfer (e.g. a gift). Promises to make a gift are not enforceable under many circumstances, but are enforceable where certain prerequisites have been met.

More information would be helpful here.

I am not an Arizona attorney, but you may want to contact someone who practices in your area and arrange for a consultation. Most lawyers will not charge for this service.

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Answered on 6/28/99, 4:00 pm


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