Legal Question in Business Law in Illinois

100,000 shares as leverage

I am a 10% owner in a start-up @100k shares @ 1.19 per. We verbally agreed that some start-up cash could be used for personal bills to help support us as we move along. Now they are claiming that was not so and asking that I give up my shares with no guarantee they will not litigate. As well as pay back the cash used. Can I use those shares to get a promise to not litigate as well as wipe the slate clean? At this point I just want to move on.


Asked on 9/18/06, 9:07 am

1 Answer from Attorneys
David K. Staub Staub Anderson LLC

Re: 100,000 shares as leverage

You can try to use anything in your favor as negotiating leverage. The question is - will it really give you much leverage? That depends on a lot of facts - what do the corporation's articles of incorporation and by laws say, is there a buy-sell agreement, were there offering materials or supplemental written materials of any kind that either support your position or give the company or other shareholders rights to repurchase your shares?

This is much too complicated to rely on an internet posting. You should contact an attorney and seek professional advice on your rights before you commit to anything.

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Answered on 9/18/06, 9:48 am


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