Legal Question in Business Law in California

Re: Dissolve S Corp. or Give my share away to other owner.

There are many options available to you. However, which one is best for you will depend on the specifics of your situation such as what your articles of incorporation provide, what is stated in your corporate bylaws, what assets the business has, etc.

My office specializes in construction law. If you are serious about getting legal help and would like a free consultation, contact me directly.

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Best of Luck!

Re: Dissolve S Corp. or Give my share away to other owner.

I agree most strongly with the answer given by Mr. Telanoff. You can resign as a director and as an officer by giving written notice to the other co-founder. You can't "resign" as a stockholder, but if you are ONLY a stockholder and do not participate at all in management, you are rather unlikely to be held liable for the corporation's debts or misdeeds. It is still preferable to get bought out, of course; it seems to me that at some price, the other guy should be extremely eager to buy you out to avoid the possibility of your creating a deadlock at a future shareholder meeting!

It is possible under the Corporations Code to go to court to force the dissolution of a deadlocked corporation (one where ownership is 50-50 and the co-owners cannot agree on basic decisions), but I'd avoid that if possible due to the hassle and expense.

The corporation must file a new Statement of Officers, etc. (see Secretary of State Form SO-200) within a short time after a realignment of officers and directors, and I suggest verifying that this has been done two months or so after you resign.

Re: Dissolve S Corp. or Give my share away to other owner.

The short answer is you have a board meeting and decide to disolve and divide up profits, assets and debts.

Re: Dissolve S Corp. or Give my share away to other owner.

I disagree with the previous answer. That only works if you can co-operate, which it appears that you cannot.

You have a variety of options, the simplest of which is that your co-owner buys your shares.

You probably want to resign from the Board of Directors and from any officer positions you have, and report this to the Secretary of State.

You may need to bring a court action for an involuntary dissolution of the corporation.

You should have an attorney help you with this. Feel free to email me.

Re: Dissolve S Corp. or Give my share away to other owner.

You do all the above with proper meetings, agreements, documentation, reports, filings, notices to the state and feds, etc. If you don't know how to do so, you need to hire an attorney. Feel free to contact me if serious about doing so.