I'm being forcefully thrown out of the startup I cofounded. My other two cofounders are trying to steal half of my shares through a repurcha...

Question

I'm being forcefully thrown out of the startup I cofounded. My other two cofounders are trying to steal half of my shares through a repurchase notice. They did everything in their powers to unilateraly terminate my involvement. The company charter gives them the repurchase option if I'm not involved with the company and now, they're trying to serve me the repurchase notice through UPS. It just happened that UPS couldn't deliver it. I found out they are very worried about this.

My question is: what happens if I don't get the repurchase notice?

Answer

This is a serious matter that needs to be addressed as soon as possible. Generally speaking, though following the notice rules and giving proper notice is extremely important courts do not necessarily invalidate other methods of notice. Unfortunately without reviewing the founder agreements, bylaws and the actual circumstances it is impossible to determine your rights and the notice requirements. If the value of your equity or contribution to the startup is important to you, then consider retaining an attorney to help you in the matter.

Generally the review process should only take a few hours and is not costly. At the end of which you will know what your rights are and the course of action you should consider. My practice is mostly focuses on startups and such issues come up all the time. Please contact my office at your earliest convenience to get started.

Roman R. Fichman, Esq.

www.TheLegalists.com │ @TheLegalist

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Answer

It is not possible to give a definitive answer without reviewing the Bylaws (or Operating Agreement if it is an LLC). That would define your rights as a shareholder and the notification requirement for exercising repurchase rights.

Assuming this is a Delaware entity, you will need a Delaware-admitted attorney to file litigation if that is indicated. The first step is to review the relevant documents.

Please feel free to contact me should you want to discuss this matter further.