IL based corporation
I'm in kind of a sticky situation here and I'll try and keep it short. I'm in a 50/50 partnership with somebody that hasn't held up their end of the deal in the slightest so I'd like to dissolve the partnership. Here's where everything stands.
1) We're a c-corp and the corp documents state that we each submitted capital contribution when the company began of $10k each. Mine $10k was for "services rendered" and my partners was simply listed as "cash" in this document. It lists that we each got 5k shares of stock in our corporation.
2) One thing that's caused some confusion with people I've talked to is that we have a Partnership Agreement. I've heard this is worthless since we're a c-corp but I don't know if that's true or not. The partnership agreement lists capital contributions as well, but it specifically states that my partner was supplying "cash to cover patent costs".
Now, through-out the course of the past year or so my partner has done pretty much nothing to help our business. I handle everything. I'm the developer of our product, I handle all the tech support, all of our connections with our vendors are because of me, and I handle all of the finances.
As such, I've offered to buy out my partner a couple of times but he doesn't want to do that. At the time I had decided ok, well, if he'll just start doing something then I don't have a problem with keeping him along for the ride. He hasn't, though, and now something happened that has put me over the top with all of this.
My partner never took care of the patent. When we first partnered up we talked with a patent attorney and I spent quite a bit of time on the phone with them explaining everything and they submitted a provisional patent that buy's us 1 year of time to file the full, standard patent.
The problem is my partner never paid the patent attorney for the provisional patent and then he never responded to them when they contacted him after a year to finalize the entire thing. Now it's too late! After a company/idea has been public for more than 1 year it's no longer considered "new and not obvious" and patent law says that nobody can patent it now. We've basically just made the whole solution public, which really pisses me off.
So, with all of that said, I consider our Partnership Agreement null and void. He did not hold up his end of the deal and cover the patent costs. Now, he did pay cash for some other things but he never took care of the 1 thing our Partnership Agreement specifically says he'll take care of...the patent.
So first, am I correct to assume that our partnership agreement was breached and meaningless? Also, if that is the case, what does that mean for our corporation? Those docs simply show 50/50 shares in the company but there's nothing that says what our company actually is or anything like that. I have control of the web site, the PayPal account where the funds go, and I have all of the code and everything for this entire thing because I'm the one that developed it all.
Our actual product is listed under a different name than our company and it would be very simple for me to just start depositing those funds into my own business account instead of our corporate account. I just don't know if I can actually do that without any problems..??
Any information on all of this would be greatly appreciated. Thanks so much!!!
I'm in kind of a sticky situation here and I'll try and keep it short. I'm in a 50/50 partnership with somebody that hasn't held up their end of the deal in the slightest so I'd like to dissolve the partnership. Here's where everything stands.
1) We're a c-corp and the corp documents state that we each submitted capital contribution when the company began of $10k each. Mine $10k was for "services rendered" and my partners was simply listed as "cash" in this document. It lists that we each got 5k shares of stock in our corporation.
2) One thing that's caused some confusion with people I've talked to is that we have a Partnership Agreement. I've heard this is worthless since we're a c-corp but I don't know if that's true or not. The partnership agreement lists capital contributions as well, but it specifically states that my partner was supplying "cash to cover patent costs".
Now, through-out the course of the past year or so my partner has done pretty much nothing to help our business. I handle everything. I'm the developer of our product, I handle all the tech support, all of our connections with our vendors are because of me, and I handle all of the finances.
As such, I've offered to buy out my partner a couple of times but he doesn't want to do that. At the time I had decided ok, well, if he'll just start doing something then I don't have a problem with keeping him along for the ride. He hasn't, though, and now something happened that has put me over the top with all of this.
My partner never took care of the patent. When we first partnered up we talked with a patent attorney and I spent quite a bit of time on the phone with them explaining everything and they submitted a provisional patent that buy's us 1 year of time to file the full, standard patent.
The problem is my partner never paid the patent attorney for the provisional patent and then he never responded to them when they contacted him after a year to finalize the entire thing. Now it's too late! After a company/idea has been public for more than 1 year it's no longer considered "new and not obvious" and patent law says that nobody can patent it now. We've basically just made the whole solution public, which really pisses me off.
So, with all of that said, I consider our Partnership Agreement null and void. He did not hold up his end of the deal and cover the patent costs. Now, he did pay cash for some other things but he never took care of the 1 thing our Partnership Agreement specifically says he'll take care of...the patent.
So first, am I correct to assume that our partnership agreement was breached and meaningless? Also, if that is the case, what does that mean for our corporation? Those docs simply show 50/50 shares in the company but there's nothing that says what our company actually is or anything like that. I have control of the web site, the PayPal account where the funds go, and I have all of the code and everything for this entire thing because I'm the one that developed it all.
Our actual product is listed under a different name than our company and it would be very simple for me to just start depositing those funds into my own business account instead of our corporate account. I just don't know if I can actually do that without any problems..??
Any information on all of this would be greatly appreciated. Thanks so much!!!
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