Legal Question in Business Law in California

It depends on the nature of your investment. For example, are you a partner in the business or were you just an "investor" ? Did you memorialize your business relationship? If you would like to discuss the specific facts for better feedback, feel free to contact me.

Regards,

Bryan

Bryan C. Becker

Becker Attorneys

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To expand on Mr. Becker's answer: Money put into in a business can be either a loan, which is to be repaid, or a so-called equity investment, in which case the person putting up the money is not a lender, but rather a participant in the profit-and-loss of the business. If the business is a corporation, the equity investor becomes a stockholder. If the business is a partner, the person (usually) becomes a partner.

Based on your question, it kinda sounds as though you made an equity investment rather than a loan, but the distinction is important to understand. If you did make a loan, the terms of your loan agreement would determine the timing of the repayment, interest, etc.

If you made an investment, and whether it went into a partnership, LLC or corporation, the valuation of your stake in the company versus that of the other owners (yes, you'd be an owner) is an art, not a science. Further, the rules of appraisal differ between partnerships and corporations. With partnerships, there is a tendency to treat all partners as equals in the absence of an express agreement (written or oral) to the contrary. Have partnership tax returns been filed? They should show the shares owned by each partner.

Note that a partnership is formed when two or more persons associate together as co-owners for the purpose of carrying on a business for profit, whether or not they intend to form a partnership.

If it is a corporation or LLC, there should have been some kind of investment agreement between the corporation and you indicating how many shares you were to receive for your insetment. Or, ask the person who serves as corporate secretary to allow you to inspect the shareholder register (yes, if you are a shareholder, you have a right to see it - Corporations Code section 1600(c)).

At some point you may need to retain a lawyer and/or a business appraiser to assist you in determining the nature of your rights and the value of your interest. In some respects, your question is something like "How long is a piece of string?" but I think with a little more information we can put you on the right track.