My husband and I work for a small company, and have a shareholder agreement with the owner. We were to receive 2% of the company per year, up to 20%. The agreement says "as evidenced by stock certificates".
We have reached the 20%, but do not have any of the stock certificates. I was told each year that the lawyers had the stock certificates in a safe.
The company purchased another company in 2002, and the owner has reduced our ownership from 20% to 10%. He has been going to write up a new shareholder agreement since 2002, but has never happened.
This year, the owner has decided to change from a C corp to an S corp. The owner has informed me that since the certificates have never been issued to us, he legally owns 100% of the company. (His name was the only shareholder name on the S Corp change), but that we were still "owners". Makes no sense to me.
What rights, if any, do we have? Could he legally "reduce" our percentage?
It appears that at the end of the year instead of us getting our portion reported on a K-1, we are going to get bonused our portion (which means that we will pay FICA taxes on this).
This is an extremely difficult situation because it is a closely held corporation. The owner is also our boss.
Any suggestions?
We have reached the 20%, but do not have any of the stock certificates. I was told each year that the lawyers had the stock certificates in a safe.
The company purchased another company in 2002, and the owner has reduced our ownership from 20% to 10%. He has been going to write up a new shareholder agreement since 2002, but has never happened.
This year, the owner has decided to change from a C corp to an S corp. The owner has informed me that since the certificates have never been issued to us, he legally owns 100% of the company. (His name was the only shareholder name on the S Corp change), but that we were still "owners". Makes no sense to me.
What rights, if any, do we have? Could he legally "reduce" our percentage?
It appears that at the end of the year instead of us getting our portion reported on a K-1, we are going to get bonused our portion (which means that we will pay FICA taxes on this).
This is an extremely difficult situation because it is a closely held corporation. The owner is also our boss.
Any suggestions?
