My Business Partners And I Are Not Seeing Eye To Eye. Do I Need To Litigate To Dissolve The Corporation?
If you own a business in New York, and you are not getting along with your business partners, you don't necessarily need to litigate to dissolve your corporation. Your options depend on the way that you and your partners structured the business.
Some of the determining factors in whether or not you can dissolve your corporation include:
- How you structured your shareholder agreements;
- Your corporate by-laws; and
- The certificate of incorporation.
Certain terms may allow you to petition a judge for dissolution.
Pursuant to section 1104(a) of the New York Business Corporation Law, if you are a 50% shareholder in your corporation, you may petition a court to dissolve your New York corporation. Reasons that a court may see fit to dissolve your corporation include:
- If the directors are so divided that it cannot be put to a vote;
- If the partners cannot agree on an election of directors; and/or
- If there are split factions amongst the partners, and the court rules that dissolution would be beneficial to the shareholders.
In these situations of corporate deadlock, dissolution rights under New York law are meant to protect certain ownership interests. If you want to know whether you may petition to dissolve your business in New York, you can get the professional advice of a New York business lawyer.
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