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Re: Investor/Previous Employee Starts a Rival Company
WHAT?????
You better get an attorney and start protecting yourself and what is left of your company. Basically I am seeing that an ex employee and two investors tamed up and started a rival company? You need to try and figure out the WHY of this. How could you let this happen?
I cannot believe that you would actually entertain the thought of turning vital information over to them. Tell them to talk to your attorney. GET an attorney.
When you set your company up did you set up corporate governance? Do you have a CTO, CFO, CL (Legal)O, board advisor that is from the business community, Secy/Treasurer? Do you have any copyrights on any of your product or even have an IP (intellectual property) attorney?-
Re: Investor/Previous Employee Starts a Rival Company
Company was incorporated in Deleware and a board is active. We hired, under an employment contract, one of our investors whom had marketing experience. Turned out his marketing experience was worthless for our market. We then let him go, however included in the contract was a non-compete/non disclosure for a term of 2 years. Essentially, he and the investor that started the rival company are minority shareholders (together own less than 9%). Was just curious if we deny them access to any financial info per the shareholder agreement if there could be any issues?-
Re: Investor/Previous Employee Starts a Rival Company
You may have issues enforcing that non-compete if it is tied to an employment contract. You'd have a much stronger case if you had the investors sign a separate non-compete at the time the funds were raised as additional consideration for the issuance of the shares. Next time make sure you consult with an attorney who has substantial experience in this area of the law.
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Re: Investor/Previous Employee Starts a Rival Company
Get an attorney. If they did not sign a noncompete contract, you may not have any recourse. In the future, be carefuly with your company information and consider having them sign a noncompete contract drawn up by an attorney.-
Re: Investor/Previous Employee Starts a Rival Company
Non compete agreements are most of the time worth the paper they are written on. Nothing. These 'investors' should have been vetted.
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Re: Investor/Previous Employee Starts a Rival Company
Hi! I am interested in how you are making out with this. We have the same thing going on.-
Re: Investor/Previous Employee Starts a Rival Company
Still the same. We are speaking with several attorneys as we've received conflicting information for three so far. Seems we could have justification to not provide finaincial info as they in turn could then use it. We may attempt this and if they file any legal action we, in turn, would then do the same. The two investors combined hold less than 9%. My partner and I control 80%.
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