Legal Question in Business Law in California

I am not an expert in this area but whether you have a corporation or are about to have one does not really matter. You have a contractual agreement with her that governs what can be done. She would not have put in any money if she knew you would or could cancel the partnership when ever you wanted to. You have to put her where she does not interact with staff members, get her to understand how her behavior is running employees off [you probably can not do that directly but why not run a survey from former employees as to what they would have wanted done so that they would have stayed.

I know you are looking for a quick and simple solution, but I must burst your bubble. You dont want to "breach" any contract. What I would like to do is take a look at your business relationship and documentation, and see what rights, if any, she may actually have. I would like to take a look at your business shareholder ownership agreement, partnership agreement, charter, stock certificates, whatever other documentation exists, and figure out what your best route to go is. Some lawyers actually do this type of strategic thinking and problem solving first, and I am one who enjoys solving such problems. Based on what I find, you may want to do one of any number of things, perhaps firing her, or otherwise dissolving the relationship. You started this business and there is an essence to it that is yours that she should not have the right to stay in and ruin, and the law of corporations and partnerships should have a solution for you. Certainly, the sooner I can do this, the better.

Please call me any time. You may also take a look at my website for more info.

www.danielbakondi.com

Best,

Daniel Bakondi, Esq.

[email protected]

415-450-0424

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Have your placed the assets of your Bistro into the corporation yet? It doesn't sound like anything has gone beyond the preliminary stages of forming an entity; to do exactly what will be an issue going forward. You need to show all documents to an attorney to get the proper advice. Very often, the only thing a minority stock investor receives for their cash infusion is a stock certificate. This has little or no value, especially in a small, closely held entity. Typically, it does not entitle them to any share of the profits. They only get something if the corporation (or their stock certificate) is sold to someone else. Again, show everything to an attorney as soon as possible so you can protect your rights.

Kevin B. Murphy, B.S., M.B.A., J.D. - Mr. Franchise

Franchise Attorney

I would need to review the contract prior to rendering an opinion. Contact me directly.